Selecting a staffing partner
Organizations have various views on selecting a staffing partner, and, in most cases, I see these decisions made based on hard metrics that have become stale. Too often cost is the core metric considered, especially when a Vendor Management System (VMS) is in place, specifically at large companies. But as creative leaders understand deeply, there is a cost-quality trade-off that needs to be considered. When staffing vendors are chosen based on being able to provide a broad base of talent such as administrative, mailroom, and IT, as well as creative and proposal staff, the quality of creative and proposal staff talent associated with that vendor is typically not on par with that that can be provided by a niche provider--this is not just my opinion and experience, but also feedback I have been told time-and-time again by creative and proposal team leaders.
It is important to create a set of metrics to define success in working with staffing providers. Popular "hard" metrics to measure a staffing vendor's success include price, time-to-fill, and billing accuracy. In addition to these hard metrics, it is important to consider "softer" metrics that correlate with your current and future goals for contingent staffing when selecting a staffing vendor with whom to partner. And that is the goal: a partner. Just as your teams want to partner with their internal clients, as you can be most successful when given that opportunity, staffing vendors can also be most successful when a true partnership is established.
Starting with the ultimate vision for the department and prioritizing the softer requirements can get you to metrics that not only reflect the department you're shaping, but also kick off an internal discussion of future state vision. Your considerations may include:
- Are you trying to truly augment staff with long-term contractors who will become part of the fabric of your organization? Or do you just need bodies and therefore turnover would not have a negative turnover on your product.
- Based on your work-product, can you plug and play new contractors or is there an extensive ramp-up time?
- If it's important to service your clients by employing a strong team of tenured full-time employees, you may want to create a contract staffing model that mirrors the internal metrics you value. Example considerations:
- Tenure: How will turnover affect your institutional knowledge and project turnaround time? Who will train new employees?
- Client Satisfaction: How would your client satisfaction be impacted by turnover? Do clients interact with contractors and, if so, would turnover negatively affect your ability to service clients?
- Benefits: Assuming your full-time staff is offered paid holiday, vacation and sick days, would you worry about the impact that might have on a group of contractors without those benefits? How would that affect your internal morale and retention?
Shaping priorities through your metrics will get you a staffing partner who shares your vision and who will be measured to ensure that vision is executed. After all, finding the right people is only half the battle. The benefits, service level and development opportunities a staffing firm provides to the contractor keeps your flexible staff members in their seats.
Below I've listed many potential metrics for which to measure the success of your staffing partner relationship. These should be helpful in formalizing your vision through metrics. Some metrics are particularly helpful in selecting a vendor and others are more suited to measure the performance once an agreement is in place.
General Staffing Partner Metrics
These metrics are important for big-picture evaluation of not only how the staffing partner is servicing your team but also their client base in general. If your staffing partner is the one representing your organization to a talent workforce, wouldn't you want a reputable organization?
- Average tenure of staffing provider employees in office servicing the client
- References for active clients and clients no longer working with the staffing provider
- Number of similar companies serviced by staffing provider
- Average tenure of similar client engagements
- DNBi Paydex of the staffing partner (measurement of how quickly vendors are paid by the staffing firm--if this is high, it could mean the staffing firm is having trouble paying its bills and odds are the contractors are also experiencing payment issues, which could lead to dissatisfied contractors who are more likely to leave engagements)
Depending on your organizational vision, retention can be one of the most important differentiators for a successful flexible staffing model. If turnover is an issue, ensuring your staffing partner is doing everything possible to retain your talent will boost the team's institutional knowledge, as well as reduce the loss of productivity due to training (both the time of your staff to train someone and the time it takes new team members to ramp up).
- Voluntary versus involuntary turnover of talent on assignment with client over a given month/quarter/year
- Average of overall time of employment of talent who have worked on assignment with client on a given month/quarter/year
- Average number of onsite talent for month/quarter/year
- Voluntary/involuntary separation numbers for month/quarter/year
- Number of onsite talent visits by the staffing provider over a given month/quarter/year
- Percentage of onsite employees enrolled in an online training program like Treehouse, Lynda.com, etc. and funded by the staffing provider
- Number of onsite talent appreciation events for month/quarter/year
- Number of onsite training events/opportunities by staffing partner for long-term placements
It's not unusual for some staffing companies to pluck resumes from the Internet, blind the contact information and submit the candidate to an opening...mainly, because it's easy. Requiring a robust prescreening checklist will inevitably get you more qualified candidates who have been fully briefed on your opening before the interview. A strong staffing partner will have no trouble moving through these requirements and will ensure your candidates are fully screened in advance.
- Percentage of candidates who have completed an in-person interview, portfolio review and assessment (when applicable) for talent prior to client submission for an opening
- Percentage of submitted candidates who have two positive business references on file prior to client submission for opening
- Percentage of candidates who have completed a background check/drug screen prior to submission to opening
- Percentage of submitted candidates who signed a "Right to Represent" document prior to submission
Retention rates are strengthened by the benefits the staffing provider offers their talent. Some staffing partners might offer some great benefits but do very little to promote those offerings to their talent leading to low adoption which can impact retention rates. So in addition to verifying what benefits a staffing provider offers, also ask about the adoption rates of those benefits.
- Percentage of long-term talent enrolled in the staffing provider's healthcare benefits program
- Percentage of long-term talent enrolled in staffing provider's 401k program
- Engagement-specific vacation or bonus pay
- Engagement-specific paid inclement weather days
- Engagement-specific paid sick days
- Engagement-specific paid holidays
Client & Talent Satisfaction
Business review meetings with your staffing partner at various milestones are necessary to ensure compliance and the ultimate success of the program. Capturing feedback after every engagement will help your overall evaluation of your consulting pool and customer service quality, as well as help identify any institutional-wide issues across disparate departments or business units.
- Client Satisfaction: this service-quality metric is most accurate when measured after each engagement versus at standard points in the long-term relationship with the vendor
- Talent Satisfaction: again, this metric is most accurate when contractors are surveyed about the quality of their experience following each engagement
- Scheduled performance reviews held by the staffing provider based on feedback from the client with long-term, onsite talent
- Vendor credentials for Best of Staffing for Talent/Client from American Staffing Association, Inavero, Best Place to Work, etc.
Your time is valuable, and therefore you want to partner with a staffing firm that is efficient in placing talent for your organization. In staffing efficiency is defined as getting quality candidates submitted and placed in a timely manner. If a staffing firm is reporting solely against "candidates submitted within 'x' number of days," this is easy. But if in addition they are reporting the ratio of number of resumes submitted to talent started/hired, you have a better sense of how much of your time is required to get a qualified, high-quality team member in seat. Don't get me wrong, measuring time-to-fill and ensuring you're getting candidates quickly is important, just balance that need with getting quality over quantity.
- Ratio of number of resumes submitted to talent started in the month/quarter/year based on new contractor openings
- Submit-to-interview ratio: Number of resumes submitted vs. interviews scheduled
- Interview-to-fill ratio: Number of interviews conducted vs. talent selected
- Offer rejection rate
- Time-to-Fill: I would suggest measuring this in two steps:
- Time between date of request for temporary talent until the staffing provider submits the onboarding paperwork--most of which is under control of the staffing vendor
- Time between onboarding paperwork submitted until the official start date, which the staffing vendor may have little control over; after all, sometimes it takes longer to find a desk and computer for a new contractor than the time it took to hire that individual.
- Time between date of request for temporary talent until the first submittal
- Number of talent who did not arrive for their first day over a given month/quarter/year
- Ratio of successfully completed vs. unsuccessful engagements (for short term engagements of 1, 3, 6 months, etc., when unsuccessful is defined as voluntary and involuntary turnover before the engagement is complete).
Price and Billing
No way around price. It's incredibly important, and I've outlined some cost-impacting metrics outside of standard markup or bill rate requirements that you may want to consider asking your staffing provide to measure and report.
- Percentage of team members brought on above Max bill rate
- Percentage of team members brought on below Max bill rate
- Billing and timesheet accuracy rate
- Timecard accuracy by talent over a given week/month/quarter/year.
In addition, I would suggest incorporating metrics to ensure your staffing partner proactively processes any bill rate reductions and rebates without prompting from your team. Requesting bill rate reductions and rebates indicates that you're serious about keeping contractors happy and working.
Thinking of your staffing provider as an extension of your team and ensuring the flexible workforce is incentivized and cared for as you envision will create a positive dynamic within your organization. Don't be afraid to speak frankly with potential staffing partners and provide open and clear expectations. A like-minded staffing partner will have the track record and the ability to execute that vision and provide you with a clear roadmap to ensure success.