Scott Morefield's post on staffing MSPs (Staffing MSPs: a parasite afflicting workers, customers and agencies) last week garnered a near record number of hits here at Staffing Talk and also some great comments from readers. I want to share one especially articulate one by a Robbi Rohr:
Well said. I have been in the staffing industry for over 23 years and I think I've about seen it all. Unfortunately, its not upper management (who made the dicision to use the MSP/VMS) who feels the pain of their decision. There are 3 "victims" of the MSP/VMS companies.
First, and in my humble opinion, the most important victims are the consultants who actually roll up their sleeves and go in and DO the work. Their rates are lowered because, let's face it, we can't pay them as much because the MSP fee's and the reduced hourly rates that we, as a company are forced to live with.
Second are the clients hiring managers. They suffer because their projects suffer. Having to use substandard consultants because the really good contractors are going to be working on projects that will pay the fees that they are used to making.
And of course, the consulting firms themselves have to take a hit financially in a few ways - lower bill rates, slower payment, and having to float payroll longer add up as well. And let's not forget about the manditory discounts that some MSP's require for doing X amount of work with them. All things that most people don't even think about.
We had been working with a huge "healthcare firm" - they went to a VMS - rates were so horrific that we stopped responding to the job openings. I got an email several months later from the 'healthcare firm' saying that they had sent payment to the VMS, but then the VMS simply dissappeared. The business was closed and the money was gone. The cleint said they would work with the vendors to resolve the issue. I'm not sure how it worked out for all those agencies who had paid their consultants, but I was really glad that we opted to not participate.
I cannot justify giving up part of our hard earned profits to another company for simply "pusing paper". There really is very little "value added" and by the time you see what your MSP/VMS cost you in terms of quality contract labor and lost vendor relationships, it really isn't worth it. It's just sad that the realization never makes it to the top executives who make those decisions.