By Steve Knapp, Vice President, Consulting
Have you heard or said this before?
“Our goal is to roll out one global process.”
“We should be doing the same thing in every country.”
When Standardization Doesn’t Work
It is understandable to want to standardize your process on a global basis. A standardized process has tremendous upside, like consistent documentation, an efficient support model, and streamlined reporting. I would support anyone who aims to simplify and standardize. But for all the theoretical positives, in practice a standardized, global process is nearly impossible to achieve.
I want to tell you about a good strategy for putting the building blocks in place when you’re implementing a global rollout. I’ll use a baseball analogy to classify your options as a single, a double, a triple, or a home run.
Single – Also known as “Headcount Only”. In this option, you would only track your headcount in a certain country. In doing so, you gain visibility on the population, but you won’t be 100% sure how much money you are spending. The single approach is either a good first step, or a reasonable final solution depending upon volume of contractors, local regulations and the expected ROI for doing anything more onerous.
Double – Also known as “Headcount and Spend”. With this option, you would create assignments in your system of record (for instance a VMS) and track expenditures and invoice data. Invoice data would be generated based upon expenditures created in the VMS system. The invoice data set generated can help suppliers with payroll and official invoice generation. Now you have both headcount reporting and spend reporting available in your global tool.
Triple – Also known as “Requisition to Pro Forma”. This option is very close to the full-blown solution. Here, you begin the process with your VMS/MSP by creating a requisition, sourcing the candidates, creating work orders/ assignments, tracking expenditures and ultimately creating an invoice data set. However, in this scenario, the invoice data set created is still not the official invoice. As you may know, in some countries, third party invoicing is either illegal or far too complex to be worth the effort. The triple solution allows you to take advantage of all upfront sourcing assistance and candidate evaluation help that a VMS/MSP solution can offer.
Home Run – Also known as “Requisition to Official Invoice”. This is the optimal solution, but it’s not always possible or plausible. In the case of the home run, the VMS/MSP creates the Invoice of Record along with all the other services along the way. If your headcount in a country is too small, this option is probably not worth the effort. If third party billing is illegal, this solution is a non-starter.
Of course, there is one more feature that works helps you hit a triple or a home run. That feature is initiating the MSP to pay suppliers. If this is legal, compliant, and works for your budget, we can go ahead and call that a Grand Slam.
Just remember, don’t get hung up on an international standardization of your process. When creating a global program, set realistic goals and don’t be afraid to have your processes fall into different categories by country.