6 key metrics for your contingent workforce programme
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KEY METRICS FOR YOUR CONTINGENT WORKFORCE MANAGED SERVICES PROGRAMME
If you have oversight of a contingent workforce programme, you’ve likely given some thought to measuring success. From mature programmes to a newly engaged managed services partners (MSP) partnership, how you monitor performance is key.
But before you can examine the performance of your contingent workers managed service programme, you must identify the metrics that you’ll measure. You need to consider all of the factors that drive a successful programme.
It’s very common for organisations to evaluate their contingent talent programme based only on cost savings and speed. But, in today’s era of talent scarcity, those metrics only tell part of the story.
Contingent labour metrics span from talent acquisition to employee satisfaction. When managing a contingent workforce, you must assess business impact whilst also supporting your temporary workers. In the blog below, we’ve built a checklist of the most important metrics for contingent workforce management.
Key MSP programme metrics to measure
1. Fill Rate: how quickly you can fill contingent roles
Fill rate is the ratio of contingent job orders received by suppliers against job orders filled each month. This metric is a vital indicator of whether a programme has a chance to be effective. Low rates can indicate bad process, rate card issues, inept suppliers and many other fundamental issues with a programme.
When evaluating time-to-fill it’s also important to look deeper. Try to determine if there are other factors that could be taking an unsatisfactory amount of time, such as hiring managers being slow to act once they’ve received candidates. Make sure to isolate response times when looking at critical metrics like time-to-fill. By doing so, you can determine just how fast your suppliers are moving.
2. CV to Vacancy and CV to Interview Rate: the number of relevant applications you receive
CV to vacancy and CV to interview rates help to measure the regular flow through the staffing supply chain. It’s all about creating an efficient process that works for suppliers and hiring managers.
Your MSP partner can impact these metrics dramatically. If your MSP serves as a gatekeeper between the hiring manager and the supplier, you might see low scores here. You may end up with a low CV to vacancy ratio because the supplier doesn’t know what the manager really wants, so they don’t submit anyone at all. Or, a supplier may submit an unreasonable number of CVs just to see what sticks.
It is important for the manager to work closely with the MSP and supplier to understand what the job requires. This also shortens other metrics like time-to-hire since it minimises any miscommunication. You may want to define a clear job briefing to simplify this process.
When considering these metrics, you must also be aware of maintaining existing processes and policies. When candidates apply, they expect a quick response. Define a process to ensure you respond promptly to everyone. This approach will improve your employer brand and overall candidate experience - keeping the people you want from looking elsewhere.
3. Time to Shortlist > Offer > Hire: how long the hiring process takes
Time-to-hire tracks how fast you move once you've made contact with the right potential candidate(s). In contrast to time-to-fill metrics, this tracks the number of days between the job posting and someone accepting an offer.
This metric shows how quickly the programme is delivering value. Look out for:
- If the CV to position ratio is high/low, it may indicate a poor intake session by the programme team.
- If the CV to offer ratio is off, this could be for a number of reasons. For example, it can point to a shortcoming in the supply chain or in the manager’s selection criteria. It may also indicate a lack of candidate interest in either the position or the company.
It is a good idea to report on, and analyse, your workflows. You can determine how long it takes to set up interviews, schedule testing and complete background checks. This exercise will help you to find creative ways to streamline the process.
4. Satisfaction Surveys: how happy everyone is throughout the hiring process
Most companies measure user satisfaction for their internal programmes. For contingent work management programmes, this typically starts and ends with hiring managers. However, it is imperative to measure hiring manager satisfaction, supplier satisfaction and most importantly, candidate satisfaction to ensure a quality programme.
It is a harsh marketplace reality that a scarcity of talent means there are many choices of places to work. If your company is not a client-of-choice, and your programme is cumbersome to navigate, then talent will choose to go elsewhere.
By using Net Promoter Score, an MSP programme office can ensure that managers are satisfied and contractors are happy.
5. Adherence to Supplier Rate Cards: whether everyone earns a fair rate
Many mature programmes have adopted a rate card methodology to ensure standardised rates across the company. Most contingent workforce programme managers are constantly evaluating suppliers to determine the strongest performers. Evaluation helps to find suppliers who need improvement or removal from the programme. Rate cards can help in this evaluation.
Are the suppliers adhering to rate cards, or are they submitting above the maximum threshold consistently? Is this consistent across all suppliers, or just one? If it’s occurring across all suppliers, this can indicate it’s time to refresh the rate cards as the market changes so quickly.
It’s important to align the rate card strategy to the level and quality of candidates the company wants:
- If a company claims to value quality but pays below average, it's important to question their priorities and sincerity.
- If a company is paying in the 99th percentile for a skillset that is readily available, there’s a strong opportunity for some savings opportunities.
6. Compliance Audit Results: the number of workers who pass compliance checks
This should be a simple pass/fail measurement. Being 100% compliant is often the minimum for suppliers in a contingent workforce managed services programme.
You can avoid a significant amount of risk by simply ensuring proper background screening. Keeping suppliers up-to-date on any changes is the responsibility of the programme office.
How to measure your contingent workforce metrics
Define your metrics
Your team needs to establish a clear set of metrics. Using these metrics, you can measure the success of your contingent workforce management programme and managed services provider (MSP).
Review these metrics
As your programme matures, consider revisiting what your original objectives were. Evaluate whether changing circumstances present an opportunity to review and update your strategy.
Maintain ongoing reports
The six priority contingent labour metrics are a great start. But it’s important to track trends over time. You’ll need to monitor expenditure within a resourcing budget and plan for future needs.
Seek support for measuring your success
The Enterprise Solutions at Hays team has the experience to define what programme success should look like, and how to measure it. As a leading provider of MSP, as well the management of outsourced contractors and Direct Sourcing solutions, we’ve learnt from hundreds of projects with clients across the globe.
Take a look at our MSP services to help support your contingent workforce management.