How to Succeed Staffing for Managed Service Providers (MSPs)

Becoming a staffing partner for Managed Service Providers (MSPs) presents considerable opportunities for staffing agencies to expand their reach and grow their business. There is great upside to having MSP partnerships, from access to job requirements that need to be filled to inclusion with new clients. However, finding your way through this space can be challenging, particularly for smaller firms that can often perceive the MSP structures as favoring larger competitors. Understanding the factors at play and adopting a strategic approach can help staffing firms, regardless of size, succeed in the MSP ecosystem.

Opportunities and Perceptions

MSPs can often be the gatekeepers to job postings and client access. Because of their place in the industry, they offer many opportunities for staffing agencies. By partnering with MSPs, agencies can access a steady stream of job requisitions and long-term contracts with large enterprises. This can lead to substantial business growth and increased market presence. It has also led to many suppliers vying for the attention of MSPs.

Many smaller staffing firms feel that MSP structures inherently favor larger firms. This perception stems from the dominance of Tier 1 firms, which can handle more than 75% of job requisitions. Smaller firms may feel that reaching this level is unattainable. However, enterprises and clients alike are beginning to understand better the need for niche talent, which is where smaller firms may distinguish themselves. Additionally, other strategies exist to overcome these challenges and succeed in working with MSPs.

How to Succeed

There are many key strategies that staffing firms can utilize to become successful partners with MSPs. Below are some ideas for your firm to consider:

Focus on Core Strengths

Specialization Importance: Rather than attempting to meet every demand, staffing agencies should specialize in areas where they excel. This focus allows them to provide higher quality services and stand out in a crowded market. Take the time to understand your unique differentiators and what you do best.

Staff Assessment: Conducting an honest internal evaluation to identify recruiting strengths and weaknesses is foundational. This assessment helps determine appropriate roles and responsibilities and if a different team is needed for MSP/VMS programs or if existing staff can be reallocated to better meet the demands of these programs.

Evaluate Your Tech Stack: Look at your existing technology to see if it is servicing all your needs, as well as those of your candidates and clients. Leverage AI where possible to automate tasks that take time away from your core deliverables. 

Specialization and Evaluation

Niche Focus: Staffing firms can ensure reliable service delivery by choosing specific specializations and locations. As you evaluate your performance, look to where you’ve excelled in the past and leverage that as a path forward.

Market Evaluation: Identifying high-growth markets (E.g., AI and cybersecurity) and focusing on niche roles enables staffing agencies to deliver faster and more competitively priced services. Narrowing service offerings can improve efficiency and client satisfaction.

Consistency in Performance

Overcome Size Bias Through Delivery: Maintaining consistent high performance is essential to gaining the trust of MSPs. Small firms can overcome size bias by demonstrating reliability and excellence in service delivery, challenging the perception that only large firms can succeed in the MSP space.

Look for Gaps: Understand gaps in your MSP’s and client’s needs and look to go above and beyond without them even asking.

Performance Measurement Alignment

Key Performance Indicators (KPIs): Using the same KPIs as the MSP to evaluate and motivate your team ensures alignment and clarity in performance expectations. These KPIs can include metrics such as fill rates, time-to-fill, time-to-interview, cost against rate card, and quality of hire.

Incentives: Providing incentives to staff to meet MSP performance expectations can drive motivation and improve outcomes. Aligning team incentives with MSP goals fosters a shared commitment to success.

Unique KPIs—If you have unique measurements for your team that will help you stand out, bring these to your MSP. This may be a different approach and help establish your unique brand.

Partnership with MSPs

Business Relationship: Developing a strong partnership with MSPs is a key part of generating more business. Building trust and demonstrating value can lead to a more collaborative and mutually beneficial relationship.

Feedback: Take the time to listen to the MSP's feedback. Let them be your eyes and ears for what is happening with the client and how you can change or improve your performance and relationship to advance the partnership.

Summary

Success in staffing for MSPs requires a strategic approach that leverages core strengths, specialization, and maintaining consistent performance. By aligning with MSPs' performance metrics and building strong partnerships, even smaller staffing firms can overcome perceived inequalities and thrive. With the right strategies, staffing firms can stand out from their competition and achieve significant growth and success.