What to Know about Vendor Management Systems (VMS)

A Vendor Management System (VMS) is a comprehensive software platform used by companies to oversee every aspect of a contingent workforce. It facilitates tasks ranging from finding and hiring candidates to overseeing their performance, invoicing, generating reports, and managing their exit.

In the realm of contingent workforce management, a Managed Service Provider (MSP) acts as a third-party agency offering comprehensive oversight of the contingent workforce from sourcing and screening to onboarding and compliance management. In contrast, a VMS is a technology-driven platform with the same goal. Interestingly enough, MSPs are often vendor management system customers. Depending on the situation, organizations can opt to work with a standalone VMS solution without needing third-party assistance, as a vendor management system provides a necessary software solution to organize all areas associated with contingent labor management.

VMS in staffing reduces administrative burden and accelerates the time-to-fill for open positions. It also helps control costs by increasing visibility into staffing spend, provides access to a larger pool of qualified candidates through multiple staffing agencies, ensures compliance, and provides reporting for data-driven decision-making. A VMS enables organizations to better utilize the contingent workforce, resulting in cost savings.

A VMS works to automate and centralize the sourcing, onboarding, and management of contingent workers, while also assisting your organization in adapting to industry changes, addressing skill shortages  and attracting top talent, all within one centralized system. 

VMS recruiting offers organizations a centralized and efficient way to manage the entire recruiting lifecycle, from requisition creation to candidate selection and onboarding, while providing visibility, control, and insights into the process. It begins with creating job requisitions within the VMS platform, where hiring managers detail specific requirements for open positions. Requisitions are then communicated to approved staffing vendors to submit for candidate consideration. 

The VMS streamlines the evaluation process and manages all onboarding tasks once a candidate is chosen. Optimizing the recruiting process reduces administrative burdens, optimizes productivity, and ensures a seamless onboarding process for contingent candidates. 

Once a candidate is selected, VMS provides visibility and control over contingent workforce activity, including timekeeping, invoicing, and compliance. 

Using a VMS can benefit many industries that rely on contingent labor, including healthcare, IT, finance, manufacturing, hospitality, retail, and more. Any organization that engages temporary workers, independent contractors, freelancers, or consultants can leverage a VMS to streamline their workforce management processes. Furthermore, industries that operate at scale or experience fluctuating demand (healthcare facilities managing patient influxes, retail or hospitality seasons, etc.) particularly benefit from utilizing contingent workforces at scale. This strategy allows many industries to adapt to changing needs and access a specialized skilled workforce on demand.

When selecting a VMS, consider features such as:

1. Candidate sourcing and management: Can the VMS source, engage, and manage candidates efficiently from multiple staffing vendors or sources?
2. Compliance management: Does the VMS include tools to ensure compliance with labor laws, regulations, and work classification?
3. Automation: Can the VMS streamline recruitment and management workflows to reduce manual tasks and improve efficiency?
4. Reporting and analytics: Does the VMS have the capability to generate real-time reports and analytics to help with data-driven decisions?
5. Integration capabilities: Will the VMS work with your organization’s existing systems for a seamless process?
6. Mobile: Does the VMS offer mobile capabilities to manage your contingent workforce on the go?
7. Invoicing: Can the VMS streamline the generation and tracking of invoices by processing them automatically?

By prioritizing these features, you can select a VMS that effectively meets your organization's needs and enhances your contingent workforce management processes.

Select a VMS that offers the best value for your organization in terms of features, functionality, and cost-effectiveness. When choosing a VMS, consider the following to ensure your selection meets your organization's needs:

1. Assess your requirements: Factors such as the size of your contingent workforce, the complexity of your staffing processes, compliance needs, and budget constraints should be considered.
2. Research VMS vendors: Familiarize yourself with different VMS vendors and evaluate their reputations, industry experience, customer reviews, and features offered. Look for vendors that specialize in your industry or have experience working with organizations similar to yours.
3. Consider integration: Ensure compatibility with your existing systems so you are confident the VMS is compatible with your HR, procurement, and other relevant systems.
4. Request demos and trials: From a shortlist of narrowed-down VMS vendors, demo their platforms to access usability, interface, and overall user experience. Involve key organizational stakeholders in the evaluation process to gather feedback and insight.
5. Evaluate customer support: Familiarize yourself with the level of customer support and service provided by each VMS vendor, including training, implementation assistance, and ongoing technical support.
6. Weigh the total cost of ownership: Evaluate not only upfront costs but also ongoing maintenance, support, and potential integration expenses.

By evaluating your options, you can choose the right VMS that aligns with your needs, goals, and budget. BridgeVMS is happy to support you through the process by offering user-friendly solutions and expert support to streamline your contingent workforce management.

To measure the return on investment (ROI) of implementing a VMS, consider factors such as reducing time-to-fill job vacancies, cost savings through better rate negotiation with staffing agencies, and improved invoice accuracy. Utilizing a VMS also increases productivity and efficiency in contingent labor management, reduces compliance risks, and improves the quality of hires and overall workforce performance.

If you're seeking a user-friendly VMS platform, BridgeVMS provides a simple yet powerful solution to automate and centralize your staffing processes, from sourcing and onboarding to invoicing and reporting. With BridgeVMS, you can access all the essential features you need in a VMS without unnecessary complexity, ensuring a seamless experience for managing your contingent workforce.