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Leveraging non-employee talent like freelancers, independent contractors, gig workers and SoW workers can bring a whole new level of flexibility, agility and efficiency to an organisation.
But managing a sizeable contingent workforce also represents a lot of challenges, costs and risks. If you don’t have a robust system in place, you might end up with a messy, decentralised process and no real visibility over your workforce.
Over time, this can lead to spiralling costs and issues with regulatory compliance and even physical and cyber security.
In this article, we’ll talk about how a managed service provider (MSP) could be the answer to your workforce woes, helping you to leverage the potential of the contingent workforce, without the headache of managing it in house.
What is an MSP in staffing?
A managed service provider (MSP) is an external company that delivers business-critical services to other organisations. In the world of contingent staffing, MSPs handle the sourcing, engaging, onboarding and management of a company’s contingent workforce.
How does an MSP in staffing work?
The MSP staffing model functions as a centralised workforce management solution that brings structure, oversight, and efficiency to the hiring and management of contingent workers. While each program may vary slightly depending on the provider and the client’s needs, the core process remains fairly consistent, and it’s typically powered by both people and technology.
Initially, a company partners with an MSP like CXC and outlines their hiring requirements, budgets, preferred vendors, and compliance standards. From there, the MSP takes over the day-to-day operations of contingent staffing. This usually includes managing a supplier network, handling job requisitions, and ensuring that processes follow agreed-upon workflows.
When a manager needs a temporary or contract worker, they submit a request through the VMS platform. The MSP reviews the request, ensures it meets internal standards, and then distributes it to a network of pre-approved staffing suppliers. These suppliers then submit candidates through the VMS, where the MSP screens them to ensure alignment with qualifications and pay rates. Qualified candidates are presented to the client for interviews or direct placement.
Once a candidate is selected, the MSP manages onboarding, ensures proper documentation is collected, and tracks performance during the assignment. The MSP also oversees time entry and invoicing.
Most importantly, MSP in staffing optimises the entire contingent workforce strategy. That includes analysing supplier performance, ensuring diversity hiring goals are met, and flagging inefficiencies before they become costly problems. In short, the MSP works as an extension of the HR or procurement team to deliver long-term value, not just quick fixes.
What is an MSP in staffing and why is it important?
Working with an MSP is an effective way to get access to on-demand talent when you need it — without worrying about labour costs or compliance issues. Essentially, the MSP acts as an integral part of your HR or procurement function, managing the entire contingent worker lifecycle on your behalf.
The importance of an MSP in staffing grows as a business expands or shifts toward a more flexible workforce model. Managing dozens—or even hundreds—of contractors and freelancers manually, across different departments and regions, can quickly become challenging. Without a centralised system, companies face increased risks such as rogue spend, compliance gaps, inflated rates, and poor visibility into labour performance.
By bringing in an MSP like CXC, companies benefit from a streamlined, standardised approach to contingent workforce management. The MSP enforces consistent policies across vendors, negotiates competitive rates, ensures compliance with labour laws, and delivers regular performance reporting. This not only improves operational efficiency but also supports better budgeting and workforce planning.
MSP vs traditional staffing: What’s the difference?
While both MSP in staffing and traditional staffing models are established to help businesses source talent, they differ significantly when it comes to scope, structure, and strategy. Understanding these differences is important for organisations looking to choose the most effective way to manage their contingent workforce.
In a traditional staffing setup, a company works directly with one or more staffing agencies. When there’s a hiring need, managers reach out to agencies individually, request candidates, and handle the evaluation, onboarding, and management internally. This approach can work well for companies with low to moderate temporary staffing needs. However, as the volume of contingent workers increases, so do the inefficiencies. Juggling multiple vendors, inconsistent pricing, varied service levels, and manual processes often leads to lost time, higher costs, and reduced oversight.
An MSP in staffing model, on the other hand, introduces a centralised layer of management. The MSP takes over the coordination of staffing suppliers, ensures compliance with company standards, and manages everything through a vendor management system (VMS). This system automates many of the administrative tasks that would otherwise bog down internal teams, such as tracking candidate pipelines, verifying invoices, and monitoring vendor performance.
Another key difference is visibility. With traditional staffing, workforce data is often siloed across different vendors and departments. In contrast, MSP staffing provides a unified view of the entire contingent workforce which allows for better decision-making, forecasting, and cost control.
5 pillars of a successful MSP staffing programme
So, what makes for a successful MSP staffing programme? We’ve broken it down into five key elements below.
- Comprehensive vendor management
Working with numerous suppliers to source contingent workers is a lot of work. Negotiating rates with each one, communicating about your changing needs and keeping up with multiple invoices each month can take up a lot of your time.
When you work with an MSP, they’ll vastly reduce the administrative burden on your team by handling all of this for you. An MSP can also introduce you to new vendors that you might not have otherwise been able to access — and negotiate better rates with your existing suppliers through their industry knowledge and connections.
Plus, MSP staffing programmes can help to increase vendor accountability, because the MSP will provide detailed insights into how well each one is performing. This means you can streamline your programme by prioritising vendors with the best performance records and ensuring you don’t waste time with those that can’t deliver.
- Advanced technology integration
An MSP provider usually gives its clients access to a vendor management system (VMS), which helps them to maintain full visibility over their contingent workforce.
These tools give companies insight into things like recruitment metrics, pay rates and worker locations. Using a VMS also allows you to adapt and streamline your processes to make sure you’re spending your time (and money) as efficiently as possible.
And these days, some companies are leveraging new technologies like AI to enhance their contingent worker programmes. AI-enabled VMS programs can automate key tasks like data entry, invoice processing and even communication with vendors. They can also provide deep predictive analytics that could help you to better understand your workforce, spot opportunities for cost-savings and make stronger, data-driven decisions.
- Cost management and efficiency
Companies with large-scale contingent worker programmes often lack visibility over their workforce as a whole. This is made worse by hiring managers who go outside of official systems to hire contingent workers through their own channels. Because of this, many companies have no idea what their contingent workforce is actually costing them.
But working with an MSP means uniting your entire non-employee workforce under one programme, bringing those hidden costs into view and allowing you to better control your spending.
Plus, MSPs can offer cost-effective talent solutions by leveraging their connections with vendors to provide the best rates. They also usually handle supplier payments on your behalf and issue you with one global invoice — which can represent a big reduction in admin costs for your internal team.
- Compliance and risk mitigation
Non-employee workers are subject to different rules and regulations than your permanent staff. And, if your hiring managers and recruiters aren’t familiar with the different types of workers you have on board, you may run into compliance issues.
For example, one common problem is worker misclassification, which is when a worker is incorrectly classified as an independent contractor instead of an employee. This issue is taken seriously by governments and tax authorities, because it can be seen as an attempt to avoid paying employer taxes and deprive employees of their statutory rights.
Working with an MSP can protect you from these risks, because any reputable MSP provider will have compliance best practices in place. They’ll also work with you to review your current hiring and procurement practices and identify any problem areas.
- Strategic workforce planning and flexibility
Many businesses have needs that fluctuate over time — and the ability to quickly scale your workforce up and down with those needs is a key competitive advantage.
A good MSP provider will work with you to create a workforce plan that ensures your needs will always be met — without wasting money on year-round talent you don’t need.
For example, let’s say you’re a seasonal business that takes on a large number of workers during the summer. When you work with an MSP, they’ll be able to quickly deploy those workers, ensuring you have the coverage you need to keep things running smoothly.
Working with an MSP can also be a key advantage when expanding your business: it allows you to quickly enter new markets, and leave them just as fast if you need to.
The key benefits of MSP staffing for organisations: Enhancing workforce efficiency and cost management
How MSP staffing optimises workforce management for organisations
MSP in staffing brings structure and visibility to what is often a messy part of workforce operation: managing contingent or temporary workers. Without a centralised system, organisations can end up working with dozens of vendors, using different processes, and relying on spreadsheets to track workforce performance. This often leads to inefficiencies, inconsistent practices, and limited insight into what’s working and what’s not.
With an MSP, all of those changes. The provider serves as a single point of contact for managing temporary talent needs, standardising how jobs are filled, how vendors are used, and how data is collected. They use tools like VMS to track every step of the hiring process, from requisition to onboarding to offboarding.
This centralisation makes workforce planning more accurate and compliance more consistent. Managers can see exactly where their talent is coming from, how much it costs, and how vendors are performing—all in one place. As a result, decision-making becomes faster, smarter, and more data-driven. For businesses that depend on contingent labour, that kind of visibility and control is invaluable.
Cost reduction and budget control through MSP in staffing
One of the biggest advantages of MSP in staffing is the ability to significantly reduce costs and gain tighter control over workforce budgets. When organisations work with multiple staffing agencies independently, it’s easy for rates to vary, markups to go unnoticed, and hidden costs to creep in. Without a centralised system, tracking overall spend becomes nearly impossible.
An MSP changes that by implementing consistent pricing structures and negotiating rates across all suppliers. They ensure that companies aren’t overpaying for the same roles across different departments or locations. Many MSPs also benchmark pricing against industry standards to ensure competitiveness.
In addition to direct savings, MSP staffing reduces hidden costs related to time-to-fill delays, compliance fines, or poor vendor performance. With faster hiring, better vendor oversight, and streamlined processes, organisations can avoid common budget pitfalls. Plus, detailed reporting tools give finance and procurement teams a real-time view of spending, which help them forecast more accurately and identify areas for cost optimisation.
Improved talent acquisition and access to a diverse workforce
Finding the right talent is hard enough; doing it quickly, at scale, and while maintaining quality can be even harder. That’s where an MSP adds real value. Because MSPs manage a network of pre-vetted staffing suppliers, they can quickly source talent across different regions, skill sets, and industries. This means organisations get access to a larger, more diverse pool of candidates.
MSPs also bring consistency to the hiring process. They enforce standard qualifications, monitor supplier performance, and use data to identify which sources are delivering the best candidates. Over time, this leads to stronger hires, lower turnover, and fewer hiring mistakes.
More importantly, MSPs often help organisations meet diversity hiring goals. They can work with vendors that specialise in underrepresented groups or have certifications like minority-owned or women-owned business status. With the MSP tracking this data, companies gain insight into how inclusive their hiring practices really are—and where they can improve.
Streamlined vendor and supplier management for organisations
Juggling relationships with multiple staffing agencies can become a logistical headache, especially when each one has its own processes, pricing models, and performance standards. Without centralised oversight, it’s easy for inconsistencies and inefficiencies to arise, often leading to delayed hires, inflated costs, or compliance issues.
MSP in staffing solves this by streamlining vendor and supplier management under one umbrella. The MSP becomes the main point of contact for all staffing vendors, ensuring that everyone follows the same rules, uses the same platforms, and meets the same standards. This creates consistency across the board, whether it’s in billing practices, candidate quality, or time-to-fill metrics.
The MSP also holds vendors accountable through regular scorecards and performance reviews. Underperforming suppliers are identified and coached—or replaced—while top-performing ones are rewarded with more opportunities. This continuous feedback loop ensures a healthy, competitive supplier ecosystem that ultimately benefits the organisation.
Scalability and flexibility: Adapting to workforce needs with MSP in staffing
The ability to scale your workforce up or down without long delays or added pressure on your HR teams is a huge advantage, and an MSP staffing is built to support that purpose.
An MSP in staffing typically provides a flexible model. If you need 75 temporary workers for a product launch, MSP can help you with that. Because the MSP manages a large network of staffing vendors, they can quickly ramp up talent pipelines to meet changing requirements without compromising quality or compliance.
Scalability also applies to geography and job functions. Whether a company needs administrative staff in one region or IT contractors in another, the MSP coordinates with appropriate vendors to fulfill those needs. And because everything runs through the same system, expanding or contracting the workforce doesn’t mean reinventing the process every time.
With this kind of agility, companies in industries like logistics, healthcare, and tech can quickly respond to market changes.
Time efficiency: Faster hiring and reduced administrative burden
Hiring can be time-consuming. Between posting jobs, reviewing resumes, coordinating with vendors, scheduling interviews, and managing paperwork, HR teams often get bogged down with manual tasks. MSP staffing reduces this administrative load by automating much of the process and centralising coordination through a single partner.
Using a VMS, the MSP automates job requisitions, consolidates candidate submissions, and handles scheduling and onboarding logistics. This significantly cuts down the time it takes to fill positions, especially critical for roles that need to be staffed quickly.
On the back end, MSPs also manage timesheets, invoicing, and compliance tracking, eliminating the need for multiple points of contact and redundant tasks. With one partner overseeing everything, HR and procurement teams can shift their focus from tactical work to strategic workforce planning.
Increased workforce productivity and operational efficiency
When you have the right people in the right roles, and the systems in place to support them, productivity naturally improves. MSP in staffing contributes to this by ensuring that talent is sourced, managed, and retained more effectively.
When you partner with a reliable MSP in staffing provider like CXC, you get access to talent that are matched more closely to the job requirements, and roles are filled faster, reducing downtime and ensuring that teams stay fully staffed.
Operational efficiency improves too. With automated systems handling routine tasks like time tracking, invoicing, and reporting, there’s less room for error and fewer delays. MSPs also monitor performance metrics across departments and roles, providing insights that help companies refine their workforce strategies over time.
How MSP staffing supports diversity, equity, and inclusion initiatives
Diversity, equity, and inclusion are top priorities for many organisations, but translating those values into everyday hiring practices can be challenging.
MSPs often partner with a wide range of staffing suppliers, including those that are minority-owned, women-owned, veteran-owned, or focused on placing underrepresented talent. By working closely with these, MSPs help organisations broaden their talent pool and increase diversity across the contingent workforce.
Beyond supplier diversity, MSPs also bring consistency to hiring processes. This helps eliminate unconscious bias by standardising how candidates are screened, selected, and evaluated. They can also provide data on workforce demographics, enabling organisations to measure progress on their DEI goals.
In many cases, MSPs can even help develop supplier diversity strategies from the ground up—offering guidance on inclusive job descriptions, setting diversity targets, and creating reporting dashboards.
At CXC, this goes beyond theory and into practice. For example, we support Medibank in shaping their sourcing strategy specifically for engaging Indigenous contingent workers, helping align their workforce goals with their broader diversity and inclusion commitments.
How CXC’s MSP staffing solution optimises workforce management for organisations
CXC’s MSP solution simplifies and streamlines how companies manage their contingent workforce. At CXC, we offer a modular, à la carte MSP solution that allows you to choose the level of support you need across four key areas:
- Sourcing
- Engagement and payment
- Supply chain management
- Compliance
Within those areas, we can provide a range of different services including multi-channel sourcing, supplier management and worker onboarding, offboarding and performance management. We can also offer robust compliance checks for every contingent worker engagement, helping to protect your business from risk.
You can opt to hand over your entire supply chain — or just choose the services you need help with. In other words, you’ll get the support you need, without having to pay for functions you’re comfortable handling in house.
How CXC’s MSP services streamline talent acquisition and management
Hiring temporary or contract workers can be time-consuming and disjointed, especially when dealing with different staffing agencies or manual processes. CXC’s MSP services consolidates talent acquisition into a streamlined, tech-enabled model that accelerates hiring without sacrificing quality.
With CXC as your MSP partner, you no longer have to manage multiple vendor relationships or coordinate hiring efforts across different departments. CXC handles all communication with staffing suppliers, ensuring everyone follows the same standards and best practices. This creates a more consistent candidate experience and improves the quality of talent you receive.
Additionally, CXC provides hiring data and analytics that give you a clear view of what’s working. You’ll know which suppliers are performing well, how quickly positions are being filled, and where bottlenecks may exist. This level of transparency is essential for refining your talent strategy and staying competitive in a fast-moving market.
Cost savings and budget optimisation through CXC’s MSP staffing solution
Contingent workforce costs can spiral out of control without the right processes and visibility in place. CXC’s MSP solution helps organisations rein in spending and make better budget decisions by standardising rates, consolidating vendor management, and offering real-time cost tracking.
But the real savings go beyond rate control. CXC’s centralised VMS platform provides clear visibility into workforce spend, including breakdowns by department, role type, and location. Procurement and finance teams can use this data to spot cost-saving opportunities, prevent rogue spending, and ensure every contingent hire aligns with budget targets.
There’s also a major efficiency gain. By reducing time-to-hire, improving retention rates, and minimizing administrative workload, CXC’s MSP model delivers cost savings that go far beyond the numbers on a payslip. It’s a smarter, leaner way to manage a modern workforce—without compromising on quality.
Ensuring compliance and risk management with CXC’s MSP in staffing
Compliance and risk management are two of the most critical challenges when managing a contingent workforce, especially when hiring across multiple regions. CXC’s MSP staffing solution addresses these challenges head-on, giving companies peace of mind that their workforce practices are compliant.
CXC brings global expertise in worker classification, onboarding requirements, tax laws, and employment regulations. That means we ensure that every worker is engaged under the correct terms. Misclassification risks are minimised, and documentation is handled with precision and consistency.
Beyond legal compliance, CXC ensures that suppliers also meet your organisation’s internal policies and standards. They monitor vendor certifications, insurance requirements, and background checks—so nothing slips through the cracks.
Why leading organisations trust CXC for their MSP in staffing needs
Global enterprises and high-growth companies like Boeing and IMG all trust CXC for one simple reason: we understand that staffing is not just about filling roles—it’s about building a workforce that’s agile, compliant, and aligned with business goals.
With over 30 years of experience managing contingent workforce solutions, CXC has built a reputation for being compliant and reliable. Our MSP model is not one-size-fits-all. We tailor every program to the client’s size, structure, and strategic priorities. Whether your goal is to reduce costs, expand globally, improve talent quality, or strengthen compliance, we build the framework to get you there.
When you partner with us, we work alongside your internal HR, procurement, and legal teams to understand challenges and co-create solutions that work. Our technology platform provides visibility across every touchpoint of the hiring process, and our vendor network is curated to meet the highest performance standards.
Building a future-ready workforce with CXC’s MSP staffing solution
In a world where skills gaps, rapid tech change, and hybrid work models are the new normal, a traditional approach to staffing won’t be enough.
CXC helps companies build a future-ready workforce by enabling agility, data-driven decision-making, and access to global talent. Through our MSP solution, you can scale your workforce on demand, tap into new skill sets, and adapt quickly to market shifts—without the administrative burden or compliance risks.
We also place a strong emphasis on workforce analytics. With data collected across every stage of the hiring process, CXC provides insights into trends, performance, and emerging talent needs. This helps companies forecast more accurately, reduce churn, and align their staffing strategy with long-term growth plans. Want to learn more about how we could support your business? Speak to our team to get started.
