Welcome to the future dear MSPs and VMSs
BCG Senior Partner, Rainer Strack gave a recent presentation on ‘The workforce crisis of 2030’ which you can watch here. But, if you don’t want to watch the talk, here is a picture worth 13 minutes of video time or a few thousand words and if you remember nothing else, remember this
Of the world’s 15 largest economies, responsible for 70% of the world’s GDP, 12 are projected to face a labor shortage by 2030
Source: Business Insider
Now that I have your attention, I want to discuss what this means — today’s age is defined by ‘disruption’, ‘innovation’ and ‘technology’. We are at a turning point for this industry. For e.g. we know how Freelance Management System(FMS) is taking off, essentially meaning that staffing agencies have a tough future coming up where companies and workforce start interacting directly with each other. Many large firms are already using this system and VMS companies are scrambling to integrate it into their current offerings.
Great, so what’s next?
In my opinion, there will soon be a fundamental shift in the next few years in the workforce industry especially for the MSPs and VMSs
To avoid the next disruptive tidal wave, there is a need to constantly scan the horizon and be proactive. VMSs and MSPs would benefit from removing their blinders and start to shift their focus from just their clients to the people in the background, the workers themselves. These companies spend millions attempting to engage their customers but there might soon be a time when they will need to shift focus onto engaging the actual workers.
For e.g. if you are a MSP, what should you worry about:
- Automation — soon recruitment processes will be automated and garden variety staffing agencies and MSPs will fade away. What will be required in future is a strategic partnership with the clients, one with trust, transparency and defined communication
- Value Add — MSPs will have to constantly improve their game. It will no longer suffice to just help source and manage talent they will have to now provide value added services to their clients. Today, this translates into best practices, industry standards, maturity assessments besides cost savings, compliance, risk management etc. By 2030, the focus will shift from the clients to the actual talent and very importantly helping the clients, retain this talent — the mantra then will be, “Focus on sourcing the best talent and the clients shall come”
An MSP could add value in the following ways:
- Helping clients forecast demand and supply — What is a ‘hot skill’ today may well be obsolete tomorrow. Understanding the client’s needs and skillsets of the future and creating an ecosystem of staffing agencies, educational institutions and workers will be key to the partnership
2. Help clients retain global(remote) workforce
- By 2030, India, Indonesia and US will have surplus labor. However, with India’s and Indonesia’s rapidly growing economies, new opportunities, government impetus and plenty of jobs, more and more labor workforce now wants to stay closer home. Therefore, MSPs need to start focusing on having a global network to be able to help clients source and retain high quality talent from all over the world with enhanced capabilities for remote work
- Uber and Lyft are prime examples of how businesses are already realizing the win-win situation of allowing workers to work remotely — reduced real estate costs for them and flexibility of hours and pay for the workers. Also, workers now get more time to work rather than commute
3. Advanced analytics
- The biggest challenge then becomes visibility into such a worker’s performance — and the need of the hour will be clearly measurable metrics. For e.g. Uber and Lyft use the end customer’s feedback as a measure of performance. MSPs can add value to their clients by providing more such metrics designed for remote workers
- Predictive and prescriptive analytics on global workforce behavior
If you are a VMS provider, there’s a lot you need to think about too
- Functional just isn’t good enough anymore. VMS technologies needs to be user friendly, simple, and very importantly engaging
- There is current gap in adapting to a completely remote based workforce. Think worker shortage, think immobile workforce, the need then will be a seamless user experience for a flexible, telecommuting workforce in terms of training, engagement, payments etc. Examples could be integrations to video chat interfaces, Dropbox like applications etc
- Capabilities to auto match job postings to Resumes in the talent pool — efficiency is the key
- Provide supply & demand forecasting abilities
- Predictive and prescriptive analytics on industry trends and maturity assessments based on data from other companies/industries
- Provide companies capabilities to attract and retain great people — Talent Pool for past employees, retirees and previous workers
- Retain quality talent — Gamification methods. More on this later.
- Provide capabilities for applicant tracking — visibility into the candidate application and the gaps. If a company was unable to source a good talent, they should have visibility into why. Also, if worker attrition is high at the client, help the client figure out why. In a world of scarce talent, engagement and loyalty will be a much sought after factor