Gale Winters : IT Staffing: An Evolution

Thursday, July 12, 2007

Vendor Management Systems

As IT consulting/staffing reached peak levels in the 1980’s, many companies began to seek a more efficient way to manage their temporary IT workforce and the numbers of IT services suppliers. Managers were inundated with vendor contacts, calls and meeting requests; and in some cases, corruption and kickbacks forced change.

By law, federal, state and local agencies were and are required to compile vendor lists based on a competitive bid process. While this is one way to maintain cost control to a degree, it does little to address the way in which staffing needs are fulfilled.

To address the broader goal of managing the contingent workforce process, Vendor Management Systems, or VMS’s, began to appear it the late 1980’s and early 1990’s. Simply stated, the VMS role was to produce cost efficient, high quality temporary IT staffing with faster turnaround times. Ideally, Vendor Management Systems were to:

Gain more control of the IT staffing vendor base
Consolidate the number of vendors
Reduce costs
Create an equal playing ground for all vendors
Optimize manpower utilization
Reduce time spent by hiring managers on managing the relationship.

Reducing costs are certainly a motivating force in clients implementing VMS; vendors are often told their costs will go down as well. In actuality, most vendors’ costs increase. Sales costs remain constant but recruiting costs increase to accommodate lower fill ratios. Administrative costs increase due to processing more candidates. Many VMS contracts contain discount programs for no fee employee conversion, early pay, etc. Finally, VMS costs are usually passed on the vendors, averaging 2% to 5%.

By definition, VMS reduces contact with hiring managers. Vendors are limited when trying to define the right corporate, team and individual personality mix to select the ideal candidate from a field of seemingly potential fits. Some limit the time a job order is open, usually 24-48 hours; others limit the number of resumes an individual vendor can submit or the total per job order. Because of reduced contact between vendors and hiring managers; interview feedback is often delayed if given at all.

VMS is here to stay, that’s for certain. However, the keys to successful VMS’s are communication, feedback, communication, flexibility, communication and cooperation. Oh, did I mention communication? Together with an ongoing review format, VMS will serve as a valued tool to client, vendor and consultant alike.

For more information on VMS, go to www.naacb.org.

What are your thoughts on VMS?

Posted By Default Admin At 11:03 AM •

Monday, May 07, 2007

The Changing Face of the Staffing Industry

In an attempt look at trends and impacts within the IT staffing and consulting industry, this blog will look at the industry from a historic perspective; changes that have impacted the industry over time; technology that has affected change; economic and global impacts; and what the future may or may not hold. Each posting will deal with a separate issue, or change; comments and opinions are welcomed and appreciated.

There have been many changes in the staffing/consulting industry since I first started in the field. Several ‘musts’ included: an auto and/or good shoes, fax machine, PC and 19 diskettes to load WordPerfect. If you get right down to it, these changes are simply the reflection and application of change in general. There have been many changes in technology, people and societies in general which have affected our lives in other areas.

“Back in the day,” cold calling was a must; no one got any business without branching out, meeting new managers, directors, and companies. IT reported to a finance person, or in some cases, HR. IT, Data Processing, IS, (or whatever we were called then), was a mystery to users and ‘outsiders.’ Much of that mystique was self generated and self-propagated, so they were left to staff projects though their own means. For vendors, that meant cold calling, networking, and getting to know people.

Researching a company might have been going to their headquarters and asking the receptionist if the DP Director had a few moments. Tenacity and networking were the keys to success. Many line managers were available for a quick chat if the vendor representative was given access and had relationships built; security was much less an issue then.

Resume presentation evolved from hand delivery to fax to email and VMS repositories. Contact and interaction have changed to distance us from the client and decision makers. Human Resources and Purchasing have taken an active role in policies and procedures that govern how IT services are delivered. Geography and commute now play a large role in candidate selection.

So many aspects of this business have changed to meet the needs of the clients, and the internal changes they have adapted to. As this blog goes forward, I will discuss as many of those as I can, and welcome any and all discussions, topics, reflections, and comments.

I can also be reached at gale@meridiangroup.com.

Posted By Default Admin At 9:18 AM •