A lot has changed in the 17 years since I joined the staffing industry. When I began working out of a branch office for a mid-sized commercial firm, digitization was comparatively immature. We had a text-based system chock full of keyboard-driven commands for candidate information, order details, and our pay/bill operations. This was great for much of our day-to-day work but cresting the industry’s hill we also saw a new type of system: the Vendor Management System, or VMS.
At the time, VMS had traction with large buyers but there was still a fair amount of resistance to engage with them on the supplier side. VMS as a solution had already gained a reputation with vendors for what it couldn’t support—mainly business relationships between vendors and their buyers. This manifested in a few different perceived pain points for the vendor community: difficulty managing “commoditized” blue-collar work, which was often handled by personnel from a Master Vendor on-site at a buyer; the time required to submit candidates to and manage orders in VMS added to our current systems landscape; we get few fills and little feedback since these are large accounts with lots of vendors, so every order is its own competition, and so on.
The market has matured greatly where VMS is concerned—even within the past five or so years. However, some of these comments can still be heard today–especially around blue-collar work. If we look at the benefit VMS solutions can bring to the external labor management process (regardless of collar color), we can see many of these objections are mitigated or can be dismissed entirely. Since we’re on the topic of blue-collar staffing, let’s break down an example.
So, let’s say we have a large wholesale/distribution operation. They have dozens of distribution centers running 24/7 around the continental US. They also have contracts with staffing firms in these locations to fill shifts on demand. Easy, right? A line supervisor just needs to call or stop by the on-site representative and make the request for personnel to fill in the open shift slots and that’s that. The on-site takes care of it, and the line supervisor has the labor needed to keep the operation running.
Since this is such a simple approach, it seems there’s no real room for a VMS to drive value. I have often encountered perceptions that having a VMS in place automatically assumes a drive to compete on a req-by-req basis, or that the technology adds a layer of complexity to the line managers that isn’t needed. While competition often equals savings where and when competition is possible, the assumption overlooks the other value areas tools like SAP Fieldglass provide.
Consider that our example organization may have multiple contracts with different vendors to cover its dozens of sites. Further, if the on-site firm cannot fill all requested positions themselves, they have to callout to subcontracting firms to meet the buyer’s needs. Once all the front-end staffing is done, a buyer still needs to handle the week’s timesheets and billing. Further, the buyer may lack visibility into which people from which firms are due on-site at what times and whether the people arriving are properly vetted. This can include health, safety, and environmental (HSE) training, equipment, or meeting other organizational or statutory policy requirements.
Here is where the buyer’s value for VMS in blue-collar staffing sits. The positions don’t have to be bid each and every time, especially when an on-demand requirement exists (“I need two dozen picker/packers tomorrow morning at 8:00 a.m. to keep my orders moving,” for example). The balance is in making the upfront request process as simple for the line managers as picking up the phone/swinging by the office while also providing the buyer organization the visibility and control it needs to manage risk and plan its labor needs.
At SAP Fieldglass, we can help accommodate this with Simplified Workflow that significantly streamlines the hiring manager’s request process, or a buyer can choose to use a Program Office Assisted Workflow to send requests to a central staffing office for review and management—even the on-site Master Vendor personnel if desired) for review prior to releasing the order. Automated onboarding tasks via Activity Items create records for each worker’s organizational requirements (like HSE training). Central offices within the buyer organization can access their external labor data without relying on site-specific reports from plant managers or the vendor. Vendors can easily access their history and activity with the buyer, along with a host of other benefits. The VMS maintains micro-level efficiency while enabling macro-level benefit.
This benefit is highlighted in the hiring activity we see with our customers at SAP Fieldglass. Over the past 12-months in our North America region, two of the top five job families by hiring volume are blue-collar: Transportation and Material Movers (there’s the distribution center example) and Production. Our customers are proof-positive tools like SAP Fieldglass can deliver value to an organization with major blue-collar requirements. This is further borne out by the US Dept. of Labor’s Bureau of Labor Statistics Occupational Employment and Wage Statistics data from May 2020, which notes these two occupation titles account for over 49% of the reported temporary labor in the survey.
Staffing has come a long way in 17 years, and it is continuing to evolve. Managing the external workforce has become a strategic imperative for many organizations. Using a tool like SAP Fieldglass is key to this effective management, no matter the color of the collar.
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