Buyers Meeting Point procurement by Kelly Barner

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"The Point" is written by BMP Editor Kelly Barner as well as a diverse group of guest contributors.

Webinar Notes: Institute of Human Resources Contingent Workforce

This week, I attended a webinar hosted by the Institute for Human Resources.  The webinar was titled "How can HR and Procurement work together for the Most Effective and Efficient Contingent Workforce Program" and the archived recording can be found at HR.com (after a free registration process).

The webinar was based on a successful project undertaken at Rogers Communications, Inc. Two panelists from that company joined the webinar: Karen Jensen from HR and Roger Young from Procurement. Young is responsible for the IT/Marketing and Professional Services categories, which total approximately $900M in annual spend.  He is supported by five category managers.

Rogers Communications has 45,000 employees; 38.5% of them are from a contingent workforce. Of the contingent workforce, over half (55.2%) are in a call center. 

Focus for the project:

  • HR: legal implications and employee relations
  • PROCUREMENT: cost

Concerns at the outset:

  • HR: Achieving the proper mix of permanent and contingent labor, equity of pay rates, lack of metrics.
  • PROCUREMENT: Lack of oversight for the 100+ suppliers in the category

“Before” state:

Rogers Communications had just undergone huge employee growth. As their competition caught up with them, they started looking more closely at their costs so they could make their offering as cost effective as possible.  Managers were handling their contingent workforce needs as they saw fit, and on the fly. Jensen (HR) described the situation as ‘entrepreneurial’, while Young (PROC) described it as ‘cowboy’.  Both sides knew they had to keep this dynamic in mind as they rolled out a new structure in order to minimize the compliance risk. 

Top Expected Outcomes:

  • HR: Tenure management, Employee classification, Legislative compliance
  • PROCUREMENT: Competitive rate card, Cost recovery options, Volume discounts

Lessons learned:

  • By working together, HR and Procurement found that they had a huge amount of internal clout. Managing the transition to a new program was more difficult than anticipated.
  • They underestimated how many workers were subcontracted through agencies v. independent contractors.
  • Their rollout communication had to be almost one on one, meeting with each manager, but in the end this paid off with limited compliance issues.
  • Many of the vendors they worked with had to be dragged through the process rather unwillingly (BMP note: I believe the quote was ‘kicking and screaming). It had been determined in advance that HR would handle internal escalations while Procurement handled external escalations.
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Wednesday, 24 May 2017