What is Managed Service Provision (MSP)?

August 10, 2023

A specialist recruiter discusses with a candidate a task at hand

Managed Service Provision, often abbreviated as MSP, is a service model in which overall responsibility for the management of an organisation's non-permanent workforce. This typically includes roles such as temporary staff, contractors, and Statement of Work (SoW) personnel. The question "What is Managed Service Provision?" involves understanding this holistic oversight and optimisation of flexible workforces. 

What does an MSP do?

The Managed Services Provider (MSP) assumes prime responsibility for an organisation's non-permanent workforce, offering a highly effective and compliant solution. Key functions of this service include sourcing potential candidates, conducting meticulous screenings, facilitating engagement, and overseeing administrative tasks.

The fruit of this effort is a cost-efficient solution that bolsters the efficiency of the non-permanent workforce while granting clients the ability to scale their workforce as their hiring needs fluctuate. This includes:

  • Sourcing
  • Screening
  • Engagement
  • Administration

Though Managed Service Provision isn't a newcomer in the market, it continues to evolve, adapting to the shifting dynamics of the non-permanent workforce landscape.

As the global workforce matures and the competition for talent accelerates, organisations employing a substantial non-permanent workforce are increasingly exploring longer-term recruitment models. This interest in Managed Service Provision emphasises the importance of services and technology that enable them to connect with available talent today and sustain that engagement into the future.

Why engage with a managed services provider and what are the benefits?

Managed Service Providers (MSPs) are frequently engaged by organisations that recruit substantial volumes of non-permanent workers. These workers may be dispersed across several hiring locations, employed through a variety of recruitment agencies, and engaged under differing agreements. As the recruitment supply chain expands in such companies, the associated risk tends to escalate, potentially hampering business growth plans.

This expansion often amplifies compliance risks, and the overall costs and visibility of contingent workers can become obscured or diluted, with little to no control. This is a key aspect of what Managed Service Provision means for businesses; it's a mechanism to combat such issues.

Contractual agreements, encompassing both legal and commercial aspects, often vary and may sometimes vanish entirely. Consequently, a plethora of problems can surface, typically at the expense of the client rather than the worker or supplying agency. This demonstrates the importance of managed service provision service, as it offers a safeguard against these pitfalls.

There are several benefits for implementing an MSP programme which include but are not limited to the following;

  • Improved compliance processes throughout the supply chain
  • Consolidated invoicing
  • Cost savings from reduced annual recruitment spend
  • A consolidated, fully engaged and ‘fit for purpose’ supply chain
  • Supply chain management and reporting
  • Reduction in overall time to hire
  • Rate benchmarking
  • Complete visibility of your non-permanent workforce and associated cost
  • Streamlined business operations and speedy response times
  • Implementation of Vendor Management Systems (VMS) to track and monitor hiring

It may be the case that you have recently reviewed your existing recruitment supply chain and asked your preferred supplier list (PSL) to provide you with contractual and commercial information. As a result, you have very quickly realised that you have numerous commercial and legal agreements in place. Some may no doubt be fit for purpose and offer little or no benefit or protection to you, as the end client.

When to consider an MSP solution?

Usually when you grow from a small to medium sized business although there are obvious benefits for large corporations as well.

Organisations tend to consider implementing an MSP solution when their headcount is more than 125+ non-permanent workers.

Other factors such as a lack of internal resource and expertise can also drive the need to adopt the expertise of specialist solutions provider to work side by side, as a trusted advisor.

External factors can also be an influence. Significant changes to employment legislation can have a long lasting and detrimental impact on a business, if not managed correctly .

Our clients have also implemented MSP solutions after reviewing their core procurement processes. Often, this leads to the conclusion that supplier spend and performance could be better managed to improve overall value for money to them, as the client.

What are the challenges when implementing Managed Service Provision?

MSP solutions display a spectrum of designs and benefits. It's critical for businesses, particularly internal stakeholders, to understand the necessity of re-evaluating their methods of procuring non-permanent workers.

Implementing a new solution or method of operation can encounter resistance and a lack of support if not handled correctly. The best practice in managed service provision implementation is to engage all relevant stakeholders from the onset. This allows for a thorough exploration of the reasons behind such changes, as well as a discussion on how these changes can positively impact daily operations.

Singular has been offering managed service provision for a number of years, demonstrating their capacity to assist in reviewing your current processes around your non-permanent workforce. This showcases their prowess in the sphere of managed service provision, and their ability to help navigate the complexities of contingent workforce management.

As a solutions provider Singular currently offer;

  • Managed Service Provision (MSP) solutions
  • Recruitment Process Outsourcing (RPO) Solutions
  • Statement of Work (SoW) Management
  • Consultancy

This post was written by: Tomás Battaglia, Content Marketing Coordinator