Managed Services in temporary recruitment first appeared over 15 years ago in the form of a Master Vendor model, whereby a recruitment agency was the main provider of temporary members of staff. Since then Managed Services have evolved and introduced different models for the service such as the Neutral Vendor and hybrid models.
So what does Neutral Vendor mean? A Neutral Vendor model means that jobs are released to all supplying agencies for the appropriate category at the same time through the managed services online system. But how a neutral vendor is delivered can vary between providers. The PPS Neutral Vendor Managed Service model (NVMS) ensures that no submitted CVs contain any agency branding or contact details, which in turn ensures there can be no bias to one agency over another. This means that each supplier has an equal opportunity to source candidates for the role and therefore ensures that all supplying agencies are motivated to send their best candidates.
Not all neutral vendor services work in this manner, as many operate a ‘faster finger first’ approach to the submittal of candidates, whereby it is the first 10 CVs submitted that are sent through to the recruiting manager, providing no quality control. PPS believes that it is quality not quantity that is important and therefore allows all of our suppliers an equal amount of time to source candidates that match the criteria; all of whom are then screened by the NVMS team, which then provide the hiring manager with a shortlist of the very best candidates.
Furthermore it ensures that local agencies can continue to supply and have as much of an opportunity of filling the roles as the more established suppliers, thus helping to support smaller, local businesses in the area who otherwise might be pushed out of the market under a Master Vendor model or tiered agency preferred supplier list (PSL). The supplying agencies are more committed to supplying the clients on a Neutral Vendor account, as they know that they will receive all the roles as opposed to the few which a master vendor might decide to release. As a result, the suppliers want to send their best candidates through, as they know they are likely to receive a higher volume of roles through this model. The transparency of the model helps to create greater competition amongst the suppliers and again facilitates the high quality of candidates received. Suppliers want to be the best because they want to work on these accounts.
With a master vendor model, all roles firstly go to the master vendor who will endeavour to fill the roles and only if they cannot recruit, will the roles be released to the rest of the supply chain. Due to the reduced level of roles the lower tier suppliers receive they tend to be less dedicated to sourcing candidates for the end-client and are less likely to send their best candidates. The benefit of a Master Vendor model is that with the quantity of roles that they receive, they can offer lower margins, however this then raises questions over the quality of candidates provided. Many managed services believe the way to make cost savings is simply by driving down the margins. It is my view that this is often a mistake. I would argue that while with some positions this is possible, it is not so across the board – there is a fine balance between getting the margins right and maintaining quality. This is a balance PPS fully appreciate and adhere to.
The main reason a managed services is used is to provide a company with accurate management information on the usage of temporary staff within the organisation, how long they have been in place and to understand how much they are spending. The objective is to reduce the number of temporary workers in place, to reduce the cost per hire and to ensure that there are cost savings. It is my view that a Neutral Vendor managed service is much more likely to deliver such results over a Master Vendor. The Master Vendor approach is provided by an agency of consultants who are working for commission – it is ultimately not in their interest to reduce the number of temporary workers in place as this would directly impact on their earnings.
PPS is not an agency therefore we are not working for commission, we are fully dedicated to our clients’ aims and objectives and work in partnership with the HR and procurement teams to help reduce the reliance on temporary workers and provide real cost savings. We are highly engaged with both the managers and the suppliers and work closely with both parties to ensure that the best candidates are provided.
These are just a few examples as to how the PPS Neutral Vendor managed services approach provides benefits to both our suppliers and to our clients.
The PPS neutral vendor managed service model is unique; to find out more about how we differ from other neutral vendor providers please contact Mandy Glover
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