Managed Service Provider (MSP) Solutions in the Nordic Region

112

In an interview with Eva Olsson, the Director for ManpowerGroup Solutions’ TAPFIN Nordic Region, we discussed ManpowerGroup Solutions and MSPs within the Nordic region. As well as the use of single and multi-country deployments, increasing interest in the use of MSPs, challenges for MSPs in the Nordic region and problems organizations are seeking to solve by using MSPs.

1. Which Nordic countries does ManpowerGroup Solutions cover and why?

Eva: ManpowerGroup Solutions Nordic region covers the countries of Sweden, Denmark, Norway and Finland. ManpowerGroup Solutions is organized this way to achieve synergies as many of our clients are present in more than one Nordic country.

2. Are the majority of countries seeking to deploy MSPs in the Nordic region looking for multi-country or single-country deployments?

Eva: Many have presence in multiple countries, whether it be throughout the Nordic regions, in EMEA, or globally. We can see that the interest for MSP and/or “lighter” versions of MSP solutions, part of the Broker Market here as I explain in the answer to the next question, are growing rapidly. The market is still learning and understanding what an MSP solution is and what value it can bring to the client. It is usually driven from Procurement and HR whom usually don’t have the same knowledge of outsourcing the complete processes, and do not always have the responsibility to do so for the operational business, which is why they sometimes want to do a “lighter” version. However, I believe in two years MSPs will be fully deployed in the Nordic region.

3. When did Nordic countries increase their interest in using MSPs? Why?

Eva: We were certified to implement MSPs at the end of 2012, and we started branding TAPFIN in April 2013. It was around this same time that our clients started to ask for these types of solutions, both from the expansion of global programs into the Nordics and from our Nordic clients. There is a history from about 5+ years back with a Broker Market. A Broker is an umbrella company handling freelancers and small suppliers within a network supplying to companies. Many companies with interesting brands work with frame agreement setups. However, it is difficult for small and self-employed businesses to get these kinds of contracts, so this opened up the market for these kinds of umbrella companies. However, the Broker Market sees MSP solution companies as a threat and therefore are adjusting their solutions to become MSPs. So the definition of an MSP in the Nordics is dependent on who has talked about and branded it to the client.

4. What situations are Nordic companies looking to solve when they look toward MSPs?

Eva: The most common reasons, besides cost savings, is that companies have a lack of visibility and control over their contingent labor and SOW solutions. CRM systems used by a client sometimes have HR or Procurement modules but they are not as sophisticated as the VMS technologies.

Another reason is the demand of control with regards to reports and statistics on short notice. The demand to be able to make fast decisions or change strategies to adapt to the market is increasing, but it is very hard to get a hold of with the base of technology support and process within their companies. On top of that, when there is a change, the normal change is to take away back office support personnel, which results in less people to produce more market intelligence which demands technology and aligned processes.

5. What are the biggest challenges in deploying an MSP in Nordic countries?

Eva: While many people cite legislative or governmentally mandated employment concerns as a roadblock of MSP, and specifically VMS deployment, I haven’t seen any very specific legislation that can’t be handled by a VMS at this point. I have found six other roadblocks, however:

  • Immaturity of understanding what an MSP is and the value it can bring. Companies are often afraid that business-critical suppliers would not engage with the program and leave.
  • Procurement/operations not in agreement of what objective is the most important one, quality vs. cost.
  • Immaturity of Procurement/HR outsourcing.
  • Cost of salary for the people in the program. Client wants the program to support with all details that the client can manage themselves due to lack of resources, but they don’t want to pay for it.
  • The number of large or medium sized clients is limited.
  • Smaller clients want the same solution as larger clients but often the VMS is too large a technology to deploy for small volume customers to make it profitable or gain the ROI.

6. Are there any specific talent shortages, skills gaps, or talent needs that MSPs are able to address for organizations working within Nordic countries?

Eva: The answer to this all depends on the competence area, hiring level, and the cost. There is a lack of certain competences within engineering and IT, specifically in niche areas.

Eva Olsson is the Director for ManpowerGroup Solutions’ TAPFIN Nordic Region. She has been in this position since 2013. Before this, she worked in various roles within ManpowerGroup.