If you use a lot of temporary help in
your business, you probably are juggling two or more staffing agencies to fill a variety of positions: from administrative help to information technology
personnel to those in managerial functions. You may have wondered if there
were a better way available by using
technology to manage this work force,
streamline costs and optimize your time.
“Businesses are talking about VMS
(vendor management system) and how
this new technology is making life easier
for those in charge of managing temporary staff,” says Michael Reyes, Director
of Enterprise Accounts for Talent Tree
of Houston.
Smart Business spoke with Reyes
about VMS, what it does and how to
select the VMS vendor that is right for
your business.
What are the benefits of implementing a
vendor management system?
The biggest benefit is having one point
of contact, one organization to manage
all temporary staffing needs. It’s ‘one-stop shopping.’ The technology allows
you to manage time entry flow, invoices
and requisition all online. It eliminates
dealing with multiple vendors with multiple rates, and it broadens the pool of
temporary workers. It eliminates the
risk of being price gouged.
What if a business likes the staffing vendors it works with? Does it have to change
over to one vendor with a VMS?
No. Often many temporary staffing
firms participate in these systems so
you have a wide pool of vendors that
temporary personnel will come from.
The difference is that you only pay the
vendor that is managing the particular
VMS program, which maximizes efficiency. Some VMS vendors are the
staffing companies themselves who
own the technology; some VMS vendors
are technology companies.
What does the ideal VMS do?
The system should have the ability to
generate real-time reporting, consolidate
invoicing and set up any type of electronic fund payments. Most important, it
is necessary to have someone within the
organization understand the VMS and
know how to use it. The VMS also needs
to have a solid roster of temporary
staffing agencies across the nation who
want to sign up to the program. It must
have a national — as well as regional —
footprint.
The VMS must also be able to accommodate requests from all job niches:
from janitorial help to administrative
staff, from IT personnel up to CFOs.
That is truly the luxury of a system like
this — to sit down at the computer and
create a job description and simply click
a button to fill a request. These requests
can be for short assignments to cover
vacationing or sick employees, or long-term assignments for special projects.
How can a business best evaluate VMS
providers, and what does it cost to get
started?
VMS programs should have good relationships with third-party vendors; they
should also be able to provide references and case studies. A VMS program
should also have a national presence and
the provider should understand the
staffing industry and not just be a technology provider. The software should be
able to manipulate information in the
system and allow customization of job
requests.
Cost to implement a VMS ranges from
$50,000 to $100,000 for the software and
training cost. The specific cost depends
on how much customization is required.
After that, there is a yearly maintenance
fee to cover IT expenditures, depending
on volume. That fee is about $12,000 a
year.
Is VMS for every business?
It is only for large organizations that
work with multiple staffing vendors and
want to streamline the process. It is not
a tool for small organizations since this
is for high temporary help volume — $10
million-plus spent in temporary help. It
is also a tool for temporary help only —
those with direct-hire needs don’t need
this kind of ongoing technology tool to
manage these employees. Large businesses with multiple offices across the
country are ideal candidates for VMS.
MICHAEL REYES is the Director of Enterprise Accounts for Talent Tree, www.talenttree.com, a staffing company based in Houston.
Reach him at (972) 361-0123 or [email protected].
