Dissatisfied with Your existing MSP or VMS Program? – Pros and Cons of Making a Change


You’ve engaged a Managed Service Provider (MSP) solution to outsource contingent workforce management to what you expected would be a trusted partner with the requisite expertise to keep contract roles filled and properly administered. Or perhaps you’ve deployed a Vendor Management System (VMS) software solution to automate your services procurement processes and ensure compliant administration of contingent labor resources. Both solutions required significant time and money to select and implement. So, what happens when either your MSP, your VMS or both fail to achieve the intended goals and you’re faced with making a change? Here are some pros and cons to making the fraught decision.

Whether it is a software solution or a process outsourcing service, many of the reasons you might be considering a change are the same. Maybe your VMS provider has been failing to achieve the metrics for system uptime as required by your service level agreement with them and your system was offline during a critical period. Or maybe they’ve demonstrated leaky data security protocols and compromised sensitive worker data. Maybe your MSP isn’t providing enough communication and follow-up to ensure they’re bringing the right talent to your projects in a timely fashion? Perhaps your talent needs have evolved as your business has grown/changed and your incumbent providers aren’t equipped to flex in concert with the changes in your operations. Whatever the reasons, changing horses in mid-stream can be necessary but also problematic.

The “Cons” of changing an MSP or VMS provider before the end of their scheduled engagement can be costly and potentially damaging. Some of the more predatory MSP providers are prone to litigate to enforce the full term of their contracts with customers which are typically inked for 3 to 5 years. Potentially costly legal costs and wasted time are behind many organizations’ decision to endure a flawed partnership with a solution provider.

When it comes to replacing a VMS platform, the primary “con” is the unavoidable interruption such a change will affect on an organization’s operational continuity. The time and effort involved in gathering business requirements and other things required to select the most applicable new VMS software is significant enough. Even more time and effort is needed to integrate a new software with other existing tech platforms and then train the entire staff on a new system. These steps almost always have some impact on business continuity – grinding operations to a slow crawl if not an outright standstill.

On the other hand, there are obviously significant “Pros” to changing an MSP or VMS provider. Taking the dramatic step of changing a provider in the middle of a contract term is almost always done because the incumbent is delivering egregiously poor service/results. So, simply cutting them loose should represent a great reason to make such a change. But, it is critical to select the right solution provider so that the same failures are not revisited. The right VMS should deliver simple user experience for broader user adoption. It delivers superior data capture which supports predictive analytics and other business intelligence functions built right into the automated workflows for more effective, efficient sourcing, talent acquisition and workforce management.

Selecting the right MSP to replace a bad actor should also be done with care to ensure the new provider has experience sourcing talent that aligns with your business model. More natural alignment between a provider’s capabilities and a customer’s business model/needs will ensure a more effective relationship. Focus selection on important functions like strategic guidance, communication/collaboration and breadth of experience to ensure the new provider is not only a responsive partner but also one with broad enough experience to flex with your organization as you grow and evolve.

Seeking to break off a bad relationship with your VMS or MSP solution provider? nextSource can help make sure you make the best possible change to minimize the pain and disruption this often involves. Talk to us today for guidance and consultative advice.

To read more on this subject, turn to nextSource for expert guidance and visit our managed services page.

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