An ill-managed contingent workforce management program will lead to higher workforce costs, compliance issues, internal process inefficiencies and reduced business success. No business wants to fall victim to any of these risks. That’s where a vendor management system (VMS) comes in.
A vendor management system is a software application that helps companies manage their contingent workforce program. A VMS will give your business better transparency into (and control) over your vendors, relationships and risk. In addition, a vendor management system will facilitate every process from internal requisition requests for contractors to invoicing at the end of a project.
With these capabilities, there are important benefits that your business can gain from using a VMS. Here’s our top list…
1 - Measurable results
Because a VMS stores all of your contingent workforce information in one place, you are able to collect data and analytics for reporting. Data driven insights will help you uncover:
- Future needs
- New opportunities, such as new markets or projects
- Process inefficiencies
You will also be able to track and measure vendor performance against the contract, so you can maximize the performance of the staffing agencies you work with.
2 - More cost-effective labor
Many businesses struggle with their contingent workforce management. This is usually because processes are decentralized, leading to hiring managers across all areas of the business having their own systems and terms for hiring contractors. The resulting inconsistencies lead to paying higher than necessary rates for contingent workers and vendors.
A VMS will ensure that all departments and managers are using the same platform and procedures. You’ll also be able to make better hiring decisions by allowing you to:
- Compare rates for labor types in your system so you can be sure that you're getting the best value.
- Uncover discrepancies in overtime and exaggerated rates.
3 - Automated processes
A VMS will help simplify and centralize processes, which streamlines your contingent workforce management. It also offers tools that can help automate important but repetitive tasks that are highly susceptible to human error, including onboarding, invoicing, payment and more.
This not only reduces compliance risks, it also ensures timely completion of tasks and saves your staff time so that they can focus on other, more valuable, responsibilities.
4 - Ensures contingent workforce compliance
When managing a contingent workforce, your business must be aware of employment regulations. A VMS can help mitigate the risks associated with compliance by maintaining all of your information in one place. In the case of an audit or review, you will be able to quickly provide the information needed to prove that you’re following employment rules.
You will also benefit from important reminders that ensure you have the most up to date information and you can create controls, such as approvals, to make sure nobody is trying to get around the system. A centralized system will also ensure that every hiring manager and department is following the same processes to reduce the risk of mismanagement.
5 - More visibility
Having a centralized management system will give you greater visibility over the people working for you, where they are, what they have access to and what work they can perform.
6 - Improve cycle time
When looking to fill a position, the time it takes to do so can be critical. A vendor management system will keep cycle times down, moving you from requisition to invoicing quickly.
7 - Build stronger relationships
It can be hard to find a good vendor. A VMS will help you implement efficiencies that lead to a smooth transaction. This will help build loyalty so that you can keep using the best vendors in your supply chain.
These are just some of the many benefits a VMS can offer. Interested in learning how Conexis VMS can help you manage your contingent workforce program? Book a demo of our VMS software today.
Read More
