Top 5 most frequently asked questions from first time MSP buyers

Are you considering a Managed Service Program (MSP) for the first time? This blog will help you understand what an MSP is and how to determine which model best fits your organization.

What is a managed service program?

A Managed Service Program (MSP) is a third-party provider that manages an organization’s contingent workforce from end to end. This includes overseeing contract and temporary workers, managing suppliers, and supporting strategic workforce planning.

Choosing the right MSP can lead to a more efficient and cost-effective way to manage your non-permanent workforce.

How to choose the right MSP provider: Key questions to ask your provider

When evaluating whether an MSP solution aligns with your business goals, consider asking potential providers the following questions:

1. What size of project can you support? How many workers are needed to make an MSP viable?

MSP programs can support anywhere from 100 to over 10,000 workers within a single organization.

• Smaller programs often focus on high-value roles, such as IT or corporate positions, where priorities include pay rate control and risk mitigation.
• Some organizations seek a single supplier to manage their entire contingent workforce across various departments.
• Others may need a steady pipeline of high-quality workers for customer service or similar roles.

For a vendor-neutral (VN) program to be viable, you’ll need a sufficient number of workers to justify the investment in a Vendor Management System (VMS), the MSP team, and associated services. 

2. Will you replace our existing suppliers with your own?

Ideally, an MSP will work with your existing suppliers, especially if they already understand your business. However, if your current supply chain is underperforming, the MSP may introduce new suppliers as part of a supplier optimization strategy to ensure quality and efficiency.

3. What are the benefits of using an MSP-owned VMS versus an independent third-party VMS?

An MSP that owns its Vendor Management System (VMS) can offer several key advantages:

• Greater flexibility to customize the platform to meet your specific business needs.
• Direct control over the implementation of changes, allowing for quicker and more seamless updates.
• Potential cost savings compared to using a third-party VMS.

4. What is direct sourcing, and when should it be used?

Direct sourcing involves using your company’s brand to attract and engage talent. It also includes maintaining a database of past workers, referrals, and pre-qualified candidates.

Direct sourcing is especially effective for organizations that:

• Frequently hire for the same roles.
• Need niche or project-based talent with prior experience in the organization.
• Require access to commonly available skills through talent pooling.

5. Should the MSP team be onsite?

In my experience, having the MSP team onsite often leads to a more seamless and effective program. Being physically present allows for deeper integration with the client’s environment, quicker response times, and stronger relationship-building. That said, the modern workplace is evolving hybrid and remote models are becoming the norm, and many teams are thriving offsite.

Ultimately, the key to a successful MSP program isn’t just about location—it’s about connection. Whether onsite or remote, what truly matters is the team’s ability to understand and align with the client’s culture, communication style, and business objectives. When that alignment is strong, the program can succeed from anywhere.

Learn how to choose the right MSP provider with Hays:

 - A Guide to Mastering Managed Service Programs
 - Beyond MSP: Moving Towards a Total Workforce Model

Let’s explore what kind of partnership will work best for your business. If you have any questions or want to discuss further, don’t hesitate to get in touch.