Author Archives: Andrew Karpie



A new species: Specialist providers of contingent workforce rate benchmarking/analytics

Specialist providers of contingent workforce rate benchmarking/analytics services have emerged over the past several years. Based on our market scan, we have identified three such standalone, vendor-neutral providers — PeopleTicker, Brightfield Talent Data Exchange (TDX) and HCM Strategies. All three will be profiled at a high level in this Spend Matters PRO brief. A secondary goal of this brief is to begin to explore a broader, systematic research approach to understanding and comparing different rate benchmarking and analytics capabilities.

The estimation, or benchmarking, of contingent workforce “market” labor rates by job category is certainly not new, and rate benchmarking is widely used — or made available as a service — in practically every part of the contingent workforce supply chain (e.g., staffing suppliers, MSPs, VMS solutions, et al). But rate benchmarking data sources and methodologies have remained somewhat in the shadows for years.

Rate benchmarking produced within — and as just a part of — those contingent workforce supply chain providers has not made it easy to assess what lies behind the many different benchmarking approaches that are in use today. However, the emergence of third-party, vendor-neutral rate benchmarking and analytics service/solution specialists may help in doing so.

To compound the problem, there is currently no established framework that would allow for a comparison of different providers’ rate benchmarking approaches and allied capabilities (e.g., self-service, scenario-building and other capabilities). And, as “advanced analytics” (based on techniques such as data/text mining, machine learning, pattern matching, semantic analysis, simulations, etc.) provide a new foundation for rate benchmarking, the differentiation of approaches becomes more important over time.

Now, let’s take a look at PeopleTicker, Brightfield Talent Data Exchange (TDX) and HCM Strategies and then make some high-level observations about the group.

Hyr Medical’s Manoj Jhaveri: ‘We knew that this was a big, hairy, audacious problem worth solving’

Healthcare staffing has long been a big business — and a major spend category for hospitals and healthcare systems.

But are the established staffing models meeting the needs and expectations of healthcare delivery organizations and contingent healthcare professionals? And are there alternatives?

We recently spoke with Manoj Jhaveri, the co-founder and CEO of Cleveland-based Hyr Medical, which aims to leverage lean processes and technology (including blockchain) to provide a lower friction, higher velocity alternative to traditional locum tenens staffing.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: December 2019

Welcome to the December 2019 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space.

As we head into December and the holiday season, we look back on the developments in November: Small service providers now ‘Open for Business’ on LinkedIn; Is the job board Indeed going gig?; Fiverr grows topline, not bottom; crowdsource testing; and news about financial services for freelancers.

An inside look: Premier Inc. acquires Medpricer, a purchased services procurement solution

healthcare

Let’s take a closer look at the Premier Inc. acquisition of Medpricer announced recently. For this Spend Matters PRO brief, we talked with leaders of both firms to get further insight into the acquisition and what it means. We also offer some reasons why this development is significant for procurement practitioners. Premier Inc., a $1.2 billion diversified healthcare improvement company, has acquired Medpricer, an innovative solution provider focused on the management of the enormous and largely unmanaged “purchased services” category of spend within hospitals and healthcare systems.

Premier bought Medpricer for $35 million and expects the acquisition to be modestly accretive in 2020. The company has stated that Medpricer will continue to operate as an independent unit and brand, and will remain GPO neutral, while augmenting Premier’s own technology and analytics capabilities. Medpricer’s CEO will continue to lead the business as part of Premier’s Supply Chain Services segment.

Headquartered in Charlotte, North Carolina, Premier describes itself as “a leading healthcare improvement company, uniting an alliance of more than 4,000 U.S. hospitals and health systems and approximately 175,000 other providers and organizations to transform healthcare.” The company leverages integrated data and analytics, collaboratives, supply chain solutions, and consulting and other services to promote "better care and outcomes at a lower cost.” It also collaborates with members “to co-develop long-term innovations that reinvent and improve the way care is delivered to patients nationwide.”

“Medpricer’s spend management platform,” the company has noted, “uses artificial intelligence to validate, compare and onboard purchased services suppliers; track and measure spend by category, supplier and facility; benchmark contracts terms to ensure competitive rates; set and manage specific savings targets; and manage contract compliance.” It was also noted that purchased services — which “often fall outside the scope of national group purchasing contracts” — are estimated to “account for up to 30% of a typical healthcare provider’s non-labor expenses, and represent a total addressable acute care market of approximately $160 billion.”

Premier told Spend Matters that “Medpricer is an important component of its evolving cost management strategy and is an integral next step in our continuing expansion toward a fully integrated purchased services platform.” Premier also noted that it has the “ability to fund and materially accelerate the development of Medpricer’s offerings.”

Spend Matters recently posed some questions to Premier. We received written answers and also had an opportunity to talk with Premier’s Senior Vice President of Supply Chain, David Hargraves, and Medpricer’s President and CEO, Chris Gormley.

Sourcing and Engaging the Independent/Freelance Workforce — An Emerging Ecosystem? (Part 4)

IQNavigator

In Part 4 of this five-part Spend Matters PRO series on the emerging independent contract worker (ICW) digital ecosystem, we will examine “worker-facing services.” These are services designed and offered to independent workers by providers, many of which may not have existed five years ago.

Part 1 of this series discussed the size, growth and constitution of the ICW population in the U.S. (it cuts across many types of work/workers: freelance creatives to construction workers, Uber drivers to truck drivers, etc.). Part 2 of the series examined the extent to which a digital ecosystem has been forming to provide enterprises with the required capabilities to source, manage and maximize the value of this ICW population. In Part 3, we described (and represented graphically) the different components of the emerging digital ecosystem today (see the ecosystem graphic below).

Part 4 looks at the extent to which a part of the ICW digital ecosystem is forming to provide ICWs (and incorporated microbusinesses) with the access to the opportunity pathways and the support/services (the worker-facing services) that they require to function as viable “operators.” It provides an overview of the service and service provider landscape and concludes with some comments leading into Part 5.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: November 2019

Welcome to the November 2019 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space.

Workforce Logiq acquires ENGAGE Talent and gets even smarter

Workforce Logiq, a global provider of workforce management software and services to large corporations, announced it has acquired the predictive analytics and AI software company ENGAGE Talent.

ENGAGE, based in Charleston, South Carolina, provides major businesses with various analytic services that improve talent acquisition and engagement performance. Both Workforce Logiq (which is owned by The Carlyle Group) and ENGAGE Talent (founded in 2014) are privately held companies, and the terms of the deal were not disclosed.

The acquisition marks further momentum of Workforce Logiq’s strategic transformation ...

Online Platform RigUp Raises $300 Million: Maybe Not Just Another Unicorn?

Online marketplaces for connecting workers and businesses have been around since the early-to-mid 2000s. But it has only been in the past eight years that larger organizations have begun to take notice of them (more, perhaps, as curiosities than as full-fledged, digitally enabled suppliers of workers and services). The reality is that few, if any, of the top 5,000 private employers in the world have established compliant, online marketplace sourcing channels that would account for more than 1 or 2% of their contingent workforce spend. Whether or not this is changing in any significant way is open to debate.

However, something does seem to be happening, if not on the large-enterprise demand-side, then on the supply-side, where, over the past year or so, significant capital has been flowing into some business-focused (versus consumer-focused) online marketplaces. That includes Austin-based RigUp, which recently announced a $300 million series D round. With a $60 million Series C round in January 2019 and four earlier financing rounds since its launch in 2014, RigUp’s financing now totals $423.8 million. According to the Wall Street Journal, the most recent “financing brings the valuation of the startup aimed at energy contractors to $1.9 billion.”

Unlike its white collar, online freelancer, global marketplace cousins, Upwork and Fiverr (which completed their IPOs in October 2018 and June 2019, respectively), RigUp has been focused on mostly blue collar workers deployed on the ground in the U.S. energy sector. At of the close of trading on Oct. 25, Upwork (which is more or less the same size as RigUp in terms of gross services volume) had a market value of $1.64 billion.

In this Spend Matters PRO brief, we will take a look at RigUp, and we'll examine where it fits into the broader landscape of digital platforms for work and services platforms. We will also discuss reasons why RigUp might be a different type of animal and how that might affect the thinking of procurement practitioners pondering the viability of online work/services platforms as sourcing options.

Beeline update: VMS veteran makes strides on partner network, UI, services procurement, direct sourcing

After about a year since our last meeting with Beeline, Spend Matters recently had the opportunity to be briefed by its team on developments related to the comprehensive Beeline global VMS solution. One thing is for sure: Beeline is not resting on its laurels. Now celebrating its 20th year in business, the company is growing and responding to market changes.

In this PRO review, we present what we learned in the briefing, which covered a number of areas:

* Business overall
* Partner ecosystem (including key new partnerships)
* UI upgrade
* Candidate evaluation experience (including new evaluation partnership)
* Services procurement (including independent contractor solution, compliance and complex sourcing)
* Direct sourcing (including a direct sourcing platform partnership)

This brief will conclude with our thoughts on the recent briefing.

Bullhorn Acquires Erecruit — Is It Relevant to Contingent Workforce Managers?

Bullhorn, a leading provider of comprehensive software for staffing/recruiting agencies, recently announced its acquisition of its rival Erecruit. Terms of the acquisition were not disclosed, but the combined companies (each of which have acquired key competitors over the past several years) now serve about 11,000 staffing supplier customers, primarily in the U.S. and Europe. Note: Bullhorn has reported that 95% of its customers are temp staffing agencies vs. 5% placement agencies and executive search services; and we assume there was a similar ratio for Erecruit.

Bullhorn’s acquisition of Erecruit is in itself a significant event within the staffing industry. But it also led Spend Matters to ask some questions:

* Do contingent workforce managers take an interest in what is going on upstream in their supply chains? That is, beyond standard performance metrics (cost, speed, quality) which treat staffing suppliers mostly as black boxes that produce certain commodity outputs (submittals, candidates, quality hires, et al.).
* Do practitioners consider which technology providers that their staffing suppliers are using, how much they are investing in technology and digital transformation, or how they are innovating for the benefit of its business clients and workers?
* Finally, do those investments in technology, digital transformation and innovation put those suppliers in a better position to provide talent and service to a demand-side organization? These seem like important questions with either a one-word answers (i.e., “no”) or multi-word answers (with potentially many viewpoints and long discussions that cannot take place within the boundaries of this brief).

Accordingly, in this brief, we are not going to delve into those questions as such, but rather focus on Bullhorn’s acquisition of Erecruit (what’s the context, what’s in it, what lies ahead). Then, contingent workforce managers can form their own thoughts about how important upstream supply chain (and specifically, technology) changes are and how much attention and consideration they merit.

So let's look at this deal and how these two entities (once direct competitors, now a single business) stack up ...

What is a VMS today? Spend Matters’ SolutionMap helps define it 

work intermediation platform

Vendor management system (VMS) solutions have been synonymous with contingent workforce technology for the past two decades, but the functions associated with it have been evolving.

It began as a fit-for-purpose software application for managing temporary staffing suppliers and temporary workers, but over the past 10 years, most of these solutions have added functionality or modules to manage contract services/SOW suppliers and service delivery engagements. In the past five years, some providers of these solutions have grappled with the VMS term and concept. Today, most providers of these types of solutions still refer to themselves as VMS solutions, although their solution footprints vary.

When Spend Matters introduced its first SolutionMap for Contingent Workforce and Services (CW/S) enterprise technology in Q2 2018, it decided to forgo the use of the term VMS in favor of developing separate SolutionMap rankings for distinct technology solutions that addressed three extended workforce categories: (1) Temp Staffing, (2) Contract Services/SOW and (3) Direct Sourcing of Workforce/Services (formerly named “Independent Contract Workers”). This was done in part to sidestep the growing variability of the meaning of the term VMS. But more importantly, it was done based on the belief that the three categories provided a more accurate way to analyze and compare solution capabilities (to be discussed further below).

This SolutionMap Insider brief examines the current status of VMS and how Spend Matters draws a tentative line around what constitutes a VMS solution today. It also provides a high-level view of the “VMS” capabilities and an anonymized analysis of corresponding SolutionMap scores. Lastly, it concludes with questions posed to practitioners and providers about the validity of the definition and concept of VMS presented in this brief.

Utmost’s Extended Workforce System: What’s Behind It, What Is It and What Does It Mean for Enterprises?

It is important for enterprises to have a handle on the whole of their contingent (or extended) workforce. Not just temporary workers supplied by staffing firms, but also workers that are engaged through service providers (ranging from building maintenance companies to management consulting firms and BPOs ). And then there are the independent and freelancer workers of all kinds, however they are classified.

A new workforce technology start-up, Utmost, thinks it’s very important to enterprises — and workers too. The company recently announced the launch of its core platform, Utmost Extended Workforce System, and an $11 million series A round led by Greylock Partners and a partnership with Workday Ventures. The company, with offices in San Francisco and Dublin, was founded by two former Workday executives and a former Groupon technologist.

With respect to where there is a critical gap in the solution marketplace, the co-founder and CEO of Utmost, Annrai O’Toole, said in a recent announcement: “With hundreds of millions of extended workers engaged with companies today, there is an undeniable shift happening, yet it is clear that businesses need new, seamless solutions to transparently manage this population.”

Greylock partner Sarah Guo offered a starker assessment of the gap in the market: “Companies in every sector engage with an extended workforce, but the rigid and clunky systems used to manage that workforce are stuck in the past. Utmost is a cloud solution for the modern, flexible enterprise, and offers a worker-centric approach to manage this population that enterprises previously lacked.”

To be clear, Utmost is building an advanced open-technology platform that will be valued by enterprises right out of the gate. But, just as important (if not more so), the company is also taking a “worker-centric” approach, starting with easy-to-use mobile apps and efficient engagement workflows for external workers (and it is also working on delivering a set of enabling services to these often severely underserved workers).

In this PRO brief, Spend Matters examines the conditions that are creating a demand for a solution like Utmost Extended Workforce, provides an explanation of the solution and looks at what it means for enterprises.