Reverse scorecards and how they can quickly change your business.

Most of us remember report cards in school. Some may recall an exciting experience, a chance to confirm greatness, a time to shine. Others might not want to remember them at all or repress that experience into a deep, dark part of the soul that is only shared with a best friend or puppy (and maybe those are the same person right now #quarantine). Regardless of how we felt about report cards, their intent was simple: feedback equals improvement.

In the contingent labor space, the equivalent to the report card is the Supplier Scorecard. MSP program teams produce these based on the Key Performance Indicators (KPIs), or criteria most important to the customer’s contingent labor program. They measure the supplier, share the data and provide feedback, all with a simple goal: feedback equals improvement. It is well-intended and helpful. Unfortunately, it is also incomplete.

Since the data is one-directional, it only tells part of the story. And worse, it only facilitates improvement for one member of the partnership -the supplier.

Who loses out?

• MSP program teams. These teams are often staffed with tenured resources, many of who ‘grow up’ with the program. This allows them to be experts and oftentimes know more about the customer’s organization than, well, the customer. But it can also cause them to live in a silo, with knowledge based on that single program. They revert to what they know, which makes it easy to miss what they don’t know.
• The client customer. This group also misses out. Business evolves, competitors change and problems are solved with new innovation. The customer knows their own organization. The MSP knows the customer. But some suppliers work with a diverse cross-section of industries, companies, and MSPs and have significant knowledge to share. Lack of exposure to what’s happening on the ‘outside’ can create a limiting, myopic strategy.

What if the scorecard process was two-way? What if everyone came to the table with data, insights, and feedback with the goal of mutual improvement?

At Aquent we have been gathering data about our contingent labor programs for years. As the largest creative and marketing staffing firm in the world, we are currently in 157 MSP programs through twenty-four MSP channel partners globally. We measure twenty-two key metrics and roll them up to the five categories most important to us as a supplier. We use this data for our own internal purposes, such as resource allocation and account prioritization, and we categorize programs based on how good they are and how many issues need to be fixed.

But we recognized that, while we were embracing the external feedback we were receiving, we were falling short on a key pillar of our obligation as a partner: sharing feedback. Especially tough feedback.

We decided to change this through what we call Program Partnership Discussions, or reverse scorecards. Instead of just gathering data, our dedicated MSP Global Alliance team created a global proprietary system to share our data in a way that tells a story. In essence, we can compare programs and say: “Here is where this MSP program is good, here are challenges impacting the customer and the suppliers and this is what we think we should do about it.“

Now, going to a partner and saying “This part of your program is not great” seemed risky to some. Did we wonder if our program teams would actually care about our data? Did we worry that they would be offended? Did we consider that it might even backfire on us, the audacity of grading and ranking our partners? Yes, we did.

Fortunately, we learned this wasn’t risky, and it might have even been brilliant.

It turns out that MSP program teams are made up of caring human beings (we knew that)! So, when they see an invested partner who brings data, constructive feedback, and candor, they aren’t annoyed-they are appreciative (Whew!). By sharing insights from the unique perspective of a supplier that works in hundreds of programs, we are able to reframe the conversation and discuss new solutions. And when we hear things like “this is so helpful to see” and “tell us more about how our program compares,”- we know we are on to something big.

Common program challenges.

When we first launched we saw a variety of challenges within programs. The most common were:

• Low volume in our space, usually combined with some barrier to hiring manager engagement. Lack of adoption inside a program is challenging, especially if we can’t be part of the solution. See “Change the Rules / Save the Day” for more on this.
• Low fill rates / inefficient order process. Many things can contribute to this, including the number of suppliers in our category, the percentage of submittals that are shortlisted and how slowly the order process moves. Ultimately, if it is too hard for us to get the fill in one program versus another, our best recruiters will put our best talent elsewhere.
• Lack of a meaningful relationship. We measure how responsive the program team is, if they advocate for us and are invested in our success. A partnership is a two-way street and needs investment from both sides. While harder to quantify, this is by far the most important contributor to our success.

Results.

So, did we see improvement from all these candid conversations? Take a look at what happened within the first two quarters:

• Twenty-five programs had an improvement in their status (rank) because critical challenges were resolved.
• We chose to exit fifteen programs. It’s okay, this is a good thing! If a program doesn’t make sense for all three stakeholders in the partnership, then a professional ‘break up’ is smart (It’s not you, it’s me!)
• New orders increased by 40%. Yes, even with fifteen fewer programs we saw an increase in order volume as we solved challenges and revisited our capabilities.

So what’s the bottom line?

To be a good partner you should be open to feedback. You should seek it out, listen to it carefully and take action to improve where needed.

To be a great partner you need to be willing to give feedback. Giving positive feedback can help reinforce good behavior and build a friendly relationship. And giving constructive feedback is the cornerstone of creating a solution.

Remember, no problem was ever solved with silence, so prepare your data and be generous with your feedback. Who knows, your teacher might give you an A+ for effort!

Have thoughts on using reverse scorecards or other ways you’ve built partnerships? Please share. We’re always looking to learn.

This is the second in a series of articles on disrupting relationships with suppliers in contingent labor programs.