With contingent workforce program expansion and maturity, the next typical growth phase tends to include statement-of-work (SOW) engagement spend management. Getting your organization to consider the tracking and management of SOW spend activity within the contingent labor program is not simple. We often find that a majority of this services procurement spend category is also very much controlled and managed by the procurement office.
The SOW relationships with solution providers, procurement and the engaging business unit are very closely held. Allowing an outsider such as the CW program office to have a management role or just visibility to this area is not one easily granted. At a minimum, adding another layer of complexity in creating this visibility will require SOW solution providers to learn and utilize a system/technology that the CW Program office deploys.
Hence, how a CW program office determines the best approach for managing SOW spend within its standard program activities is not easy. Although most CW program offices will look to their vendor management system for process-enabling SOW management technologies, as no two organizations operate the same, being able to leverage the “out-of-the-box” VMS’ SOW best practice process technology is not realistic. CW program managers must conduct a thorough review of not only the VMS’ SOW management system capabilities offered, but the entire SOW processes itself, both internally and externally, to ensure that this next phase of CW program maturity/capability will be successful executed.
Understanding the capabilities and limitations of the VMS’ SOW technology offering is obviously critical to this next step in CW program maturity. Most VMS technologies offer some level of SOW module capability today which can be integrated to your existing program and established process management technology infrastructure. What can be tricky is knowing if you should incorporate your existing processes and procedures into the technology infrastructure or modify your current processes and procedures to align to the VMS provider’s SOW module capabilities. Another key technology consideration is whether your organization will be looking to integrate an existing source to pay procurement system with the CW program’s VMS SOW management technology? This consideration is key in the ongoing comparison of CW program office SOW engagements management activity with other SOW engagement management in the organization. Where will the overall, comparative SOW engagement management data reside and be curated into a strategic SOW program management decision support perspective?
Asking a lot of process-related exploration questions is key, along with including key corporate-function stakeholders (IT, procurement, legal) when making this strategic technology partner decision. The last thing you want to do is assume that the VMS will be the ultimate system of record or that you customize the VMS to support current processes and down the road learn that due to these “customizations” many of the future system upgrades and enhancements are not eligible for your SOW engagement management program.
Leveraging a managed service partner, understanding their capabilities and their experience with other SOW implementations can be extremely beneficial. Most MSPs are still immature in the SOW management space, so it is likely their skills and experience are more on the tactical/administrative side versus engagement management process steps. We find that many times administrative onboarding/offboarding, invoicing and milestone tracking and processing are their sweet spots. Based on recent market surveys, MSP providers appear to be investing heavily in their SOW resources such as hiring senior procurement specialists with experience in SOW solution provider sourcing, RFI, RFP, contract negotiations and solution provider performance. If they do have experience with the SOW management-enabling technology implementation be sure to request references that you can reach out to and discuss what worked well and what did not go well or what would they reconsider if they were going through the SOW management solution initiative again. Learning from others’ challenges can help you avoid making similar mistakes.
Whether utilizing an MSP partner or not, you need to assemble an experienced implementation team that can together create an impactful and sophisticated implementation plan. Include key stakeholders such as procurement (for the processes and procedures), legal (SOW template and legal requirements), business unit leaders (IT), accounts payable (accounting functions), etc. Equally important are external stakeholders such as critical SOW solution providers/supply chain partners (i.e., MSP solution and technology partners) and understanding their processes and concerns. Including people in the creation of the plan gives them a sense of ownership and can help to create cheerleaders/strategic supporters both internally and externally. Those strategic supporters will be critical for the program and will help to drive adoption of the resulting process and management-enabling technology infrastructure. As with any CW program change your overall mission and the goal of the program office will ultimately be adoption!