Neutral Vendor Managed Service Programme Model | Enterprise Solutions at Hays
NEUTRAL VENDOR MSP MODEL
This model is sometimes just called an MSP Model and it sees a workforce solutions provider deliver their service using an agreed list of recruitment / staffing suppliers (vendors) to source relevant candidates. They may recommend niche or new sources of talent outside of the PSL for one off positions or particularly tough requisitions.
They may or may not be associated to a staffing or recruitment company. In this MSP model though, qualified suppliers have equal opportunity to recommend candidates or resources. Supplier performance is optimised through review and tracking of performance and capabilities, as well as supporting suppliers to better understand your requirements.
According to Staffing Industry Analysts’ MSP Global Landscape report 2019 around 33% of organisations with a MSP in place use a vendor neutral model. Compared to 32% using a master supplier, 18% hybrid and 17% contingent RPO or direct sourcing model.
Why use a neutral vendor MSP model?
This sourcing strategy connects you with a number of suppliers to source relevant candidates, enabling be more choice. In theory the better supplier will engage and recruit the better talent. This model is recommended for more specialist roles.
The main benefits of using a neutral vendor are:
| Unbiased, all suppliers have equal opportunity to recommend candidates or resources. | Visibility of your contingent workforce | Supply chain management, control over which suppliers are used |
| Wider choice and therefore potentially better quality | Enables improvements and efficiencies to be made over time | Flexibility depending on current demands |
Some suggest this model drives competition, and therefore lower rates. However, too much competition can leave suppliers less inclined to compete.
How is the vendor neutral MSP model different to other models?
Whilst this model is delivered using an agreed list of vendors, Master Vendor is an MSP where the provider and its sister companies have the first opportunity to recommend and place candidates or resources, this can result in a speedier recruitment process and better quality of candidates thanks to a deeper understanding of the client.
One of the biggest challenges of a Vendor Neutral model is making sure you have the right mix and balance of suppliers in place, who are willing and able to participate. However, a good MSP should be more than capable of delivering this optimal balance and engaging the supply base in the right way. Being a large employer and staffing supplier ourselves helps us understand the levers and requirements of all parties.
There is also the Hybrid model which is a combination of the Neutral Vendor model and Master Vendor model which is based on capability of the provider. As this is the combination of both models it will offer the best of both.
