April 24, 2020

Brightfield (TDX): Vendor Introduction, Analysis and SWOT

By: Andrew Karpie, Lead Analyst

This Spend Matters PRO Vendor Introduction offers a candid take on Brightfield (TDX) and its capabilities. Brightfield provides enterprises with an extended workforce data-management and analytics solution (at this time, specifically enterprises that are highly focused on “digital” contract workers and SOW/services). This brief includes an overview of Brightfield and its solution offerings, a summary solution evaluation, a SWOT analysis and a selection checklist for companies that might consider the provider.

Background 

Across the globe, private and public organizations and human capital intermediaries are increasingly making use of various forms of data analytics for salary and labor-rate benchmarking, workforce analysis and market intelligence, trends and predictions. Until recently, salary benchmarking of permanent employees was predominant. Low tech, printed benchmark reports were based on historical trends and often lagged the market by many months.

Over the past 10 years, a new discipline of more dynamic labor-rate benchmarking for “contingent workforce” emerged based on processes and methodologies using online data sources, cloud technology, big data and advanced analytics/AI. Contingent labor-rate benchmarking originally arose within traditional players in the staffing industry (e.g., MSPs, large staffing firms); however, the lack of neutrality, data collection networks and inability to build robust digital products left a gap in the market.

But over the past five years, a few third party, vendor-neutral benchmarking/analytics providers have appeared. (See: “A new species: Specialist providers of contingent workforce rate benchmarking/analytics.”) Spend Matters identified three such providers, including Brightfield (access earlier coverage here and here). These technology-first vendors provide their solutions — depending upon their go-to-market strategies — directly or indirectly to businesses and to MSPs, staffing firms, et al. While contingent workforce benchmarking — based on very different approaches — has been the cornerstone offering, the expansion of a broader set of advanced analytics offerings has been occurring.© Spend Matters. All rights reserved. 2 

Business Overview

Brightfield was founded in 2006 as a consulting firm that helped organizations optimize their contingent workforce management programs, including MSP and VMS selection.

By 2015, Brightfield had begun to develop its Talent Data Exchange (TDX) technology platform/network and received an initial investment in May 2016 (Brightfield TDX was also analyzed in a Spend Matters PRO research brief in June 2016).

In the years that followed, Brightfield gradually evolved its business model from professional services to data management and analytics based on the TDX platform. The company raised $53 million in private equity in last fall (by which time its business-model shift was nearly complete).

Since the launch of the TDX platform, Brightfield’s business offerings have evolved from primarily contingent workforce taxonomy management and rate benchmarking to a broader range of data analytics capabilities that organizations could use to manage their “extended workforce” (contingent workers and SOW projects). While TDX also provides support for “unified workforce optimization” (e.g., employees and contract workers), the major part of the business (> 90% spend under management) is centered around “extended workforce.”

But it is not just any kind of extended workforce, it is digital contractors and service suppliers, which is typically an enterprise’s largest category of its total contingent workforce and SOW/services spend. Brightfield has reported that the key business sponsors at its accounts are the CPO, CTO and/or CFO. While Brightfield is aiming at enterprises that really are focused on major optimization of the digital/IT workforce/services category, it indicates that it would work with clients on other categories over time.

In terms of business model, Brightfield enters into agreements with “network member” enterprises that contribute (transfer) data on a monthly basis and pay a fixed subscription fee for access to the TDX platform’s analytics outputs. Members must have at least $25 million in extended workforce spend. Today’s network consists of nearly 400 large enterprise members, all companies with greater than a billion in annual revenue (that includes almost 50% of the F100).

In terms of data, members upload transactional data to TDX from their VMS, HCM, ATS and/or CLM systems on at least a monthly basis. Currently, the TDX platform processes transaction data associated with about $500 billion of spend, with good statistical representativeness across eight primary labor markets (along with more limited datasets from approximately an additional 90 countries).

There are two basic categories of transactional data that are collected:

  • “Work behavior” drawn from job descriptions for contingent workforce work and SOWs for project-based work.
  • “Spend and supply chain behavior” (e.g., rates/costs and supplier performance)

This data is processed in various ways to eventually create and provide organizations/business users with different, value-added analytical outputs.© Spend Matters. All rights reserved. 3 

Solution Overview

Brightfield’s TDX data management and analytics platform was built from the ground up to bring together a number of AI-technologies (e.g., neural networks, machine learning, natural language processing) and proprietary data science. TDX offers enterprises an extended workforce and SOW/services data analytics solution that provides valuable tactical and strategic information outputs to member organizations and their business users (the latter including category managers in procurement and other managers/business users in HR, Finance, IT, et al).

To provide ongoing market and business intelligence to the network members’ business users, data is collected and processed in three stages:

  1. Brightfield’s staffers help customers set up a monthly automated file transfer from their VMS, CMS and HRIS with the structured and unstructured details of contract work transactions across extended workforce types.
  2. Brightfield’s proprietary AI technology cleans, structures and analyzes member data to contextualize price, risk and performance of labor spend. All member data is anonymized but contributed to a shared data pool.
  3. For network member business users, TDX provides information/analytics outputs of various kinds (e.g., it prescribes/recommends actions to improve cost, speed and quality and highlights spending trends, generates market benchmarks for bill and pay rates, creates visibility into MSP and supplier performance and can detect worker misclassification classifications, et al).

For business/market intelligence, analytics-based optimization and ongoing management of an enterprise’s extended workforce (contingent worker engagements and contracted SOW/service projects) offers an Extended Workforce Optimizer “module” that enterprises can subscribe to.

Extended Workforce Optimizer

The following is a summary of the capabilities of the Extended Workforce Optimizer module:

  • Workforce ManagementCreate a skills/roles inventory
  1. Create a skills/roles inventory
  2. Develop a consistent but dynamic, roles/skills taxonomy
  • Cost Comparison Benchmarks
  1. Establish target rates for new, unique or hard-to-fill positions
  2. Predict the likelihood of filling a job based on the definition of the work, the bill and pay rate, the contract length and location
  3. Determine how different skills affect rates, research rates for roles where performance challenges are attributed to market misalignment
  • Dynamic Rate Card Manager
  1. Accelerate rate card creation or refinement
  2. Assess the market, compliance and strategic fitness of rate cards
  3. Use AI-informed adjustments based on rate card objectives, historical and current assignments, existing rate cards, and market insight
  4. Run interactive “before-and-after” views of the impact of recommended updates
  • SOW Visibility
  1. Gain insight into and control over SOW spend by categories, suppliers and outcomes as well as current contracts and invoice terms
  • SOW Misclassification
  1. Detect misclassification (based on proprietary “20 markers of staff augmentation”) using machine-learning deep analysis of contract/SOW documents, language, terms, etc.
  • Supplier Management
  1. Track and measure supplier performance (supplier scorecards)
  2. Manage supplier productivity and project delivery
  3. Identify cost-overruns and manage remediation
  4. Manage rebates and discounts
  • Digital Extended Workforce Dashboard
  1. Prioritize key performance indicators and use of data tiles to create a customized leadership dashboard
  2. Achieve real-time visibility into market intelligence and program performance
  3. Automate QBR (quarterly business review) presentations to provide business leaders with critical metrics, longitudinal improvements and market trends of the contingent workforce

Unified Workforce Optimizer

The following is a summary of the capabilities of the Unified Workforce Optimizer module.

  • Workforce Analysis
  1. Achieve comprehensive visibility into employee & non-employee workforce
  2. Conduct unified workforce planning and budgeting
  3. Establish cross-talent category aligned taxonomy, cost and program benchmarking
  4. Identify current state workforce classifications, current sourcing options, workforce decision guidelines, policies and processes
  5. Identify worker conversion analysis
  • Workforce Optimization
  1. Establish targeted workforce mix strategy, build workforce optimization roadmap and design workforce decision support framework
  2. Maintain ongoing visibility into workforce needs and gaps
  3. Derive parameters to inform “make vs. buy” decisions
  4. Compare actual allocations to “optimal” allocations

Strengths Worth Noting 

We observed many strong areas, capabilities and features in Brightfield’s solutions/services. These are several that seemed particularly notable:

  • Domain-specific platform: Brightfield’s TDX was conceived and built as a domain-specific workforce data analytics “platform” imbued with AI technologies. There are not many peers that have taken the platform path. While contingent work rate benchmarking may have been the initial solution offering, Brightfield’s aim was more strategic than building a specific software product: establishing an information ecosystem and a platform that could support different solutions (products) over time.
  • Underlying data: A significant strength of the Brightfield solution is the manner, scope and depth of the data collected and how it is managed, processed and transformed into analytical outputs: the collection of pure/raw transactional data from members’s VMS, HCM, ATS, or CL/procurement systems (as opposed to external 3rd party sources), the categorical scope and the depth of data captured and the use of AI to cleanse and organize it.
  • Analytical outputs: As enumerated in the previous section of this brief, there are manifold analytical outputs that can be used to improve/optimize extended workforce cost structures and operations. In addition, because of the underlying data, collected and transformed within TDX, better outputs can be produced. For example, a market price estimate for a particular kind of SOW can be driven by contextual variables (such as the number of bids to arrive at historical price points).
  • SOW/Services capabilities: SOW/Services is a large and growing category of spend that has lacked visibility and control. Brightfield’s capability to model and assign a cost to standard SOWs, by AI-based analysis of SOW/contract language and other transactional data is impressive. The same goes for being able to identify misclassification data and other SOW-related outputs.
  • UI/UX: The solution UI is simple and clear, and navigation is straightforward.

Some Qualifications Worth Noting

Based on the high-level review we conducted, there were aspects of the solutions/tools where we thought organizations might focus some additional attention when considering the solution:

  • Strategically focused on digital workforce and IT-related services: Brightfield has chosen to focus on serving organizations with a large percentage of their contract labor spend dedicated to investing in digital extended workforce. Though the company has market intelligence across all workforce categories, TDX may not provide the best fit for companies with programs focused on lower-cost positions in retail or manufacturing.
  • Data contribution required: Part of how Brightfield grew TDX into a market intelligence standard so quickly was to require all network members to also contribute their data (anonymously) to the shared pool of data to gain scale across the consortium. In order to do this across 500 enterprise companies, the business built robust information security procedures; however, companies for whom data-sharing is a kill-for-cause may not find this to be the best solution.
  • Procurement organizations more focused on decision-support than control: TDX’s “designed for the business user” interface provides organizations with a tool to scale business insight for extended workforce transaction pricing and supplier performance management to the front Procurement organizations and companies with more of a focus on control and compliance, and willing to provide enablement and decision support to their business partners, may not benefit from the full range of capabilities.
  • Not for mid-size organizations: Brightfield acknowledges that TDX membership is not suited for mid-size organizations or ones with less than $25 million in extended workforce spend. Organizations looking for “by-the-drink” rate benchmarking will find no solution offering.

Company SWOT Analysis

Shortlist Selection Checklist

Brightfield offerings/services are appropriate for:

  • U.S.-based enterprises with more than $25 million in total extended workforce/SOW-services spend, that are:Seeking a provider that is strategically focused on digital/tech-related extended workforce (with some other categories viewed as secondary)
  1. Seeking visibility into and control over contingent workforce, but also SOW/services spend.
  2. Seeking a way to not only optimize across multiple sourcing channels (contingent vs. SOW), but also to optimize matching between business requirement and form of engagement (worker vs. service)
  3. Aiming to plan and manage a “unified workforce” across both extended and permanent employee workforce

Conclusion

Brightfield TDX is perhaps the most powerful extended workforce market intelligence platform available today. In terms of the types, sources, granularity and quantity of data that it collects, manages and analyzes and processes, Brighfield is unrivaled in the industry. The capture of detailed “behavioral data” directly from members’ own systems goes far beyond what industry peers are capable of.

It provides its member organizations with the kinds of solutions (roles taxonomy management, rate/cost benchmarking and comparisons, dynamic rate card management, etc.) that would be expected of any workforce rate benchmarking provider. But its AI-driven SOW capabilities set it further apart (e.g., detecting misclassification using machine-learning analysis of contract/SOW documents, providing deep insights into SOW spend and SOW performance).

At the same time, Brightfield is not really a fit for enterprises with less than $25 million in annual spend. And it is currently strategically focused on enterprises that are significantly committed to digital/IT-related workforce and services optimization programs (though Brightfield says it will work with members that want to move on to optimization of other categories).

For larger enterprises that are seriously focused on optimizing digital/IT-related contingent workforce and services that are able to meet the minimum spend requirement and that are able and willing to make the commitment to membership, looking at Brightfield is a no-brainer. The provider says it can and will provide some value for members that also have needs related to other spend categories. But that is a question best answered by Brightfield.

Overall, Brightfield is a pretty amazing illustration of a professional services business that has transformed itself into a digital platform business in just five years. Spend Matters will be keeping close tabs on Brightfield as it expands its coverage workforce/services data management and analytics solution this year.

Further information on this topic and others can be found at this website: www.spendmatters.com. Reproduction of this publication in any form without prior written approval is forbidden. The information in this report has been obtained from sources believed to be reliable. Spend Matters disclaims all warranties as to the accuracy, completeness, or adequacy of such information and shall have no liability for errors, omissions, or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended result. The opinions express herein are subject to change without notice. 

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