We all do it! In everyday life, in business, as we parent our children. We get done with a conversation feeling good, only to realize later that you wish you had asked another question. Or that you wish you had approached the conversation from a different perspective, perhaps sharing the context behind your inquiry to solicit an answer that is more targeted.
For many, references are a necessary evil in the process of interviewing candidates or vetting potential suppliers. This task is considered a “check the box” step toward an award selection, and may be assigned to a junior staff member. After all, what company or individual is going to provide a reference who is going to say anything negative about them?
If this is the mindset you have relating to a purchase that potentially can impact one of the top three investments your organization makes on an annual basis, then you are wasting a valuable opportunity in the vetting process. When properly executed, reference conversations can tell you a lot about what you can expect from your contingent workforce solution provider (as well as what you cannot expect). With that, let’s examine some approaches that can add value to the process.
1. Develop the reference agenda outline collaboratively up front. As you have already engaged a governance team of internal experts – Procurement, HR, Finance Operations, IT, etc. – who have helped form the RFP content, reviewed the responses, and sat through the presentations of your finalists, why would you not want their involvement in the reference process? I’m not saying they all need to conduct individual calls, but they should have input on the questions that are going to be asked. Each represented group will have different priorities and perspectives on what good and bad responses may look like and why. So let’s make sure their key criteria are addressed in the reference call agenda. Example questions for various stakeholders are below:
HR/Talent Acquisition
· Did you find that the average time to fill reduced as expected?
· Were the staff members knowledgeable about skills associated with your departments that they were supporting? (EX: Did resources assigned to engineering understand engineering to vet and down-select candidates?)
· What client staff (governance team) members were involved in the implementation process?
Procurement
· Did the burden around supplier management and contract engagement shift to the provider as expected?
· How did you work with the provider on potential contract disputes? Did it prove effective?
· How has the solution helped you optimize your supply base?
· Did the solution deliver strong user experiences and stakeholder adoption? Why or why not?
Finance/Accounting Operations
· Did the new solution improve invoicing efficiencies (via consolidation or presentment) for your own teams?
· Did the cost of invoice processing decrease?
· Did invoice aging improve as expected?
Information Technology
· Did technology deployed improve operational efficiencies?
· What challenges surfaced during implementation around integrations, configurations, and user acceptance testing?
· Did the supplier identify suitable workarounds if such circumstances arose?
2. Don’t just look at your demographic. Look at your symptoms! In 95% of the RFP’s that I have worked on during my career, the prospective client asks for 3-4 references from similar industries whom the bidder has worked with, and typically these need to include firms who are of similar size (revenues). I’m not going to say there isn’t value to these reference conversations. After all, there may be legislative or regulatory aspects, industry knowledge elements that are must haves of your next strategic partner. But there is more to look at.
What was the reason that your company decided to source a contingent workforce solution? Most likely, there are some challenges that your hiring managers are facing in identifying or engaging talent, or how you manage suppliers, or the processes for accomplishing all of this reminds you of driving through Atlanta during rush hour – it’s just not efficient and easy! Whatever it is, your current methods suffer from some type of illness. It may not be major – perhaps a common cold or allergy. Maybe it is more significant because there are issues all over. But the bottom line is you – or your contingent workforce program in this case - are sick.
So what do you do when you are sick? You seek medical expertise to help make your body feel better. If your condition is serious, you want to identify specialists who know how to treat your specific condition. Your pain. Your symptoms. You don’t need someone who knows how to treat people your own income level, religion, or political affiliation. You need someone who knows how to treat your illness, whatever it may be, so that you can win that battle to live a long and happy life!
Then why treat business references differently? Make sure that you not only check references with bidder’s clients who have similar industry demographics as your own firm but have faced similar business challenges . . . pain . . . symptoms! Ask for references of clients who, regardless of industry sector, have experienced the challenges that your firm faces today. Find out what the provider did to help address their symptoms, what was required of them as a client, the impact to stakeholders (including the suppliers), and the adoption of the solution overall. You will be surprised to find out how similar two organizations from completely different industry sectors can be when it comes to their contingent workforce programs. For example, I have learned that oil and gas firms have very similar contingent workforce management profiles as intimate apparel! (I got your attention with that one, didn’t I?)
· They both utilize third party labor, both sourced and payrolled referrals.
· There is a substantial reliance on independent contractors (trainers and inspectors for O&G; marketing and models for retailers) who require vetting and AOR services.
· They both typically are located corporately in major cities like Houston, New York or Columbus, but the real action that drives revenues is in smaller markets with access to interstate highways for distribution purposes. This is where drilling occurs for the O&G firms, and where fulfillment and distribution centers are for the retailers. These smaller markets usually require a different supplier engagement model than corporate locations due to the lack of agencies supporting the market.
3. Use extra ears! Don’t rely on just one person to do the reference calls. Have a second stakeholder involved so that you better ensure you are hearing what the other party is saying and hearing. You can also opt to have one person lead the interview, and the second to document what is learned in the responses. It is harder for context to get lost in translation when there is another set of ears on the call. The best option would be to have representatives from both Procurement (Indirect Category Manager) and HR/Talent Acquisition conduct such calls, as it seems inevitable that one of these representatives will be the sponsor of the solution once implemented. Another option would be to include your third-party consultant on those calls.
4. Ask what they learned from implementing the chosen solution. You know the saying, “You don’t know what you don’t know?” Well, it is very true when implementing complex workforce solutions. All the more reason to ask about lessons learned on the reference call. What did they discover they were missing? What did they not account for? Then, as you get the answers from the reference, look in the mirror and determine if you are falling victim to similar knowledge gaps or strategies.
I hope this helps you take advantage of the opportunity to pulse check your strategies and decisions with players who have come out on the other side of what you are seeking to build.
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