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Are PSLs a Blocker or an Enabler?

2/10/2017 by Nandip Aulak

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The use of a Preferred Supplier List (PSL) was intended to support and strengthen relationships and performance between organisations and their third party suppliers. As the technical landscape continues to evolve at rapid rate recruitment and demand for new skills becomes more intense. Are PSLs still the solution or an obstacle to sourcing the right talent?

The traditional PSL

A dedicated list of partners intended to guarantee  quality and availability of services at any time without the need to canvas for new services every time you need that service. The best third party suppliers act as an extension of your brand and your team. They are your first point of call when it's time to source talent and grow with you to provide a scalable service and developing a long term relationship.

Do requirements get lost in translation?

Organisations that work on a project basis require tech specialists that are niche to that project at hand. That's why if you are using a PSL, working with tech specialist recruiters is vital;  they , speak the same language, understand their needs, know the market and most importantly, where to find that specialist talent. If you use PSL of recruiters who represent IT candidates and have a successful history working with you, will significantly reduce the time it takes for organisation to hire and raise the overall quality of the hire.

The agency selection process is more than a tick list, it is an extension to your team and hiring managers need to be involved in the process. They are always able to provide insight that can help bridge the skills gap the organisation needs.

The dangers of a limited scope

Large, established organisations traditionally use PSL because "that's how we've always done it". Rather than question the validity and effectiveness of a PSL, their focus on the convenience of turning to their approved supplier and letting trusting them to fill essential skills gaps. But when specialist skills are required, generalist recruiters may miss out on sourcing the talent you really need.

Traditionally, PSLs are firmly in the realm of the HR & procurement departments. When positions become vacant, they liaise with their third party suppliers to fill the role. Businesses that aren't limited by PSLs are more agile, able to leverage the knowledge of their hiring managers in the decision making process. This offers several opportunities to secure the best talent on the market

While organisations have a corporate identity and culture, the same is true at the team level. Within businesses and even within silos, the character of every team is subtly different, so while a hire might suit the top level culture of the business, they might not be a perfect fit within a specific team. Hiring managers know their people and understand what it takes to work with them.

Hiring Managers are typically the individuals who run the teams and truly understand the needs from both a technical capability and cultural fit. They will speak the same language as the potential hire, allowing them to glean greater insight into the suitability of the hire.

The biggest limitation of relying on a PSL is that if talent isn't identified by your supplier, not a technical supplier, organisations miss out on the skills their teams need.

"Sometimes it's easier to say "no" as the stakeholder of a PSL when you're approached by a specialist supplier of niche technical areas, like InfoSec and Cyber Security. But saying no just because they are a niche supplier can be detrimental to the business and their projects.

"Montash are fortunate to be on a number of PSLs that work very well. But we also understand that in a market where niche skills are in such demand, that those organisations that adopt a more pragmatic and flexible approach hire talent more efficiently and hire the best talent available in a skill shortage market. 

"I'm always surprised when a company that has a specific need that's business critical allow a PSL to limit their options. As a business, Montash want to support our customers, not restrict their business needs. When a PSL acts as an obstacle, rather than a supporter of their goals, it's time to take another look at your options."

- Roy Dungworth, Montash MD

Are you missing out on essential skills?

With tech moving at such a high speed, businesses are encountering ever-larger skill gaps. Higher demands for cyber security experts, policy and compliance experts and mobile development are causing the less agile agencies to fall behind in sourcing and attracting talent.

Leading procurement teams bridge this gap by having specialists - people who speak the language of cyber security or SAP, to help the supplier find the talent the business really needs. Having a PSL doesn't turn the process of recruitment into a box ticking exercise for an organisation. The supplier and the business must work together in partnership to provide their organisations with the right talent in the most time efficient way possible.

How much time is wasted hiring the wrong person? Is it really worth hiring some talent, when what you really need is the right talent? Investing up front to find the right talent will pay dividends in the long run.

How do you feel about PSLs? Are you on a list, or use one on a regular basis? Do you find benefits of going back to the same well of talent every time, or does casting further afield provide stronger yields? A blocker or an enabler?

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