Five years ago, Staffing Industry Analysts asked buyers of staffing services what type of employee they plan to use over the next 10 years. Forty-seven percent said they plan to moderately increase use of SOW workers and 10% planned a significant increase.
Fast forward to 2019. Between 40% and 45% of contingent workforce programs worldwide have implemented some form of statement-of-work management, according to SIA research. And it is poised become even more prevalent within buyer organizations in the next two years, as survey respondents indicated adoption thresholds of between 87% and 90%.
SOW reflects a contractual agreement between a buyer and supplier and the management of said document. However, workforce services procurement is the advanced application of procurement methodologies and disciplines and applies more broadly to how statement-of-work is applied as a business practice.
The ecosystem has come a long way from debates around on what SOW means and setting up parameters on what should be included as statement of work consulting. But despite program sophistication and maturity and the fact that statement-of-work-based services comprises the largest portion of most organizations’ non-employee labor, many companies fail to account for these resources in their programs. “This lack of visibility and control puts organizations at significant risk,” says Frank Enriquez, SIA’s senior manager of contingent workforce strategies and research. Enriquez advises companies to address the lack of transparency immediately by working to getting services procurement into the program.
So how do you proceed incorporating services procurement into your CW programs? There are various things to consider including clarifying why this is important to your organization’s mission.
Scott Bedell, VP, solution design, at VMS provider Beeline, says there are six strategic considerations to focus on when embarking on incorporating SOW and services procurement into your program:
- Structure and organization. Decide whether the management will be driven by procurement or HR, managed internally or an MSP, and under central or regional control.
- Geography. Will one launch the program in the firm’s entire geographic footprint at once big-bang style or roll out in a phased approach?
- Deployment planning. It is a circular and repetitive process: Plan (strategy and assessment); Deployment (integration and implementation); and Operate (management and customer care). “It’s a plan for the scope that you are looking to deploy, and then that becomes operational,” Bedell says. Then you plan deploy and operate again, refining as. as you go.
- Change management. Your program will touch a wide range of departments and constituencies within customers. Bedell advises knowing all the deliverables, bonding across business partners, working with key business stakeholders, and keeping it tied up across business units.
- Data migration. All companies have existing data, even if it is not in a system, and data migration is where tactics and strategy come together for all involved. Testing is an important part of the process.
- Future focus. A ‘future focus’ should include workforce optimization and digital transformation. It starts at the beginning of the process and is executed throughout, although more heavily toward the end. The services procurement process is a “living process,” Bedell explains. “There is always a new scope to be uncovered, a new geography, additional steps, refinements that we can make.”
This article is based on an SIA workforce solutions webinar, “Tested Strategies — SOW and Services Procurement.” The webinar replay is available online to CWS Council members. Another helpful resource to members is SIA’s guide for CW program managers entitled, “Ten Steps to Designing a SOW Management Strategy and Business Model.”