The Forrester Wave : VMS, Q1 2014

For: Sourcing & Vendor Management Professionals The Forrester Wave : VMS, Q1 2014 by Christine Ferrusi Ross, February 10, 2014 Key Takeaways A Maturing Market Means Running Faster To Stay In Place This Forrester Wave updates one from 2010, yet suppliers scores did not significantly improve. The suppliers all improved in capabilities, but they face higher expectations from customers -- and Forrester. This is particularly true in strategy, where vendors had a much higher bar for differentiation as visions for contingent workforces converge. Similar Average Scores Make Incumbent Providers Safer From Competition Buyers need to look at the criteria that matter to them and weigh each one appropriately to get an accurate picture of which suppliers might be the best fit for their individual situations. However, given that most customers have an incumbent vendor, most buyers will need a strong reason to switch, because there aren t major differences among the solutions. Not Surprisingly, SOW Capabilities Lag Behind Contingent, But Only Slightly The suppliers did not rank in the same order in both Forrester Waves. Customers who want one solution for both types of engagement should change the weightings to create one unified picture of capabilities. And with two exceptions, providers scored weaker in SOW than in contingent functionality. Forrester Research, Inc., 60 Acorn Park Drive, Cambridge, MA 02140 USA Tel: +1 617.613.6000 Fax: +1 617.6100 www.forrester.com

February 10, 2014 The Forrester Wave : VMS, Q1 2014 How Vendors Rank For Contingent Staff And SOW/Services Procurement Engagements by Christine Ferrusi Ross with Chris Andrews and Ben Jennings Why Read This Report Companies spend a significant amount of money on nonpermanent workers and they need a vendor management system (VMS) to manage the complexity of a contingent workforce program. But as programs incorporate project-based work and begin to globalize, customer requirements for VMS solutions are increasing dramatically. Luckily, VMS vendors are listening and the VMS software market has added significant functionality in the past three years, particularly in the statement-of-work (SOW) based area. In Forrester s 85-criteria evaluation of VMS vendors, we identified the 10 most significant software providers in the category and researched, analyzed, and scored them. This report details our findings about how well each vendor fulfills our criteria and where they stand in relation to each other to help sourcing and vendor management (SVM) professionals select the right partner for their contingent workforce and SOW/services procurement software needs. Table Of Contents 2 4 5 6 12 Firms Need Solutions To Manage Nonpermanent Staffing Complexity Our Forrester Wave Research Demonstrates Contingent Trends In Action Market Conditions Make VMS Products Highly Competitive VMS Evaluation Overview VMS Evaluation Criteria Evaluated VMS Vendors High Expectations And A Crowded Market Make A Strong VMS Space Vendor Profiles Leaders Strong Performers Notes & Resources Forrester conducted product demonstration evaluations in August and September 2013 and interviewed 32 customer references. Related Research Documents VMS Versus MSP: What To Expect From Each October 30, 2013 Increasing The Value Of Contingent Staffing MSPs October 23, 2013 FAQs About Services Procurement Solutions February 22, 2013 The Forrester Wave : Services Procurement, Q3 2010 September 30, 2010 Contenders 14 Supplemental Material 2014, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. To purchase reprints of this document, please email clientsupport@forrester.com. For additional information, go to www.forrester.com.

The Forrester Wave : VMS, Q1 2014 2 Firms Need Solutions To Manage Nonpermanent Staffing Complexity Companies spend roughly 2 of their IT budgets on all nonpermanent labor individual contractors, workers from staffing agencies, and employees from project-based IT services firms. 1 Add in non-it categories like light-industrial workers, administrative staff, among others, and the spend for contingent staff becomes a huge but highly distributed category of spend for most companies. For example, one large healthcare firm told Forrester that it employs two nonpermanent workers for every permanent one. Often, given the fragmented nature of nonpermanent, or contingent, staffing it s only the sourcing and human resources departments that have visibility into how much spend is at stake. The complexity of managing the process from finding candidates (whether directly or through staffing agencies), to scheduling and selecting them, to onboarding them, and finally off-boarding them at the end of the assignment is daunting. As a result, most firms use vendor management systems (VMS) to address the contingent worker process and automate as much as possible. Forrester asked the VMS customer references what business need drove them to implement a VMS and we found that the vast majority of customers wanted improved visibility into this fragmented spend as well as cost savings and better efficiency (see Figure 1). 2 Figure 1 VMS Customers Seek Visibility, Efficiency, And Cost Savings What need(s) or business requirement(s) drove you to adopt a VMS? (select all that apply) To gain more visibility into our contingent labor/project-based usage As part of an effort to improve cost savings of contingent labor To get better efficiency of our contingent labor/project-based processes 84% 81% 78% To automate manual processes 75% To make better hiring decisions 41% It was recommended by our MSP 13% Base: 32 global references who work directly with their organization s VMS decision-making Source: 2013 Global Online VMS Survey 107421 Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 3 Our Forrester Wave Research Demonstrates Contingent Trends In Action Forrester has written previously on trends in this space. In October 2013, Forrester wrote about four trends: 1) globalization of talent and needs; 2) a more sophisticated understanding of contingent; 3) inclusion of SOW work into contingent programs; and 4) separation of VMS software and MSP services. 3 As we researched the VMS space, interviewed customer references, and got demonstrations of the products, Forrester found evidence for each of the trends listed above. Some examples of how those trends are becoming operationalized include: Strong functionality for global needs and clients in multiple geographies. The vendors we evaluated have all invested in multigeography support, as well as functionality that helps clients stay compliant with international labor and tax laws. DCR Workforce had the fewest international clients, supporting companies in eight countries. Fieldglass had the most it had customers in 101 countries. Most suppliers had customers in at least 25 countries. Evolving strategies to accommodate richer contingent perspectives. Previously, where employers had very black-and-white definitions of contingent (such as hourly-rate light industrial workers, for example) they have evolved to more complex and rich definitions that make it harder to classify those workers and hire the appropriate skills. The VMS vendors have expanded their rules-based categorization functionality to include wizards to help clients decide how to classify their contingent needs. They ve also invested in improving their services catalogs to make it easier for customers to use a broader set of standard job descriptions, or to modify those descriptions based on unique needs. Strategically, most suppliers have talent management visions that tie together all nonpermanent workers into a more holistic picture. IBM and Peoplefluent both went further with strategic visions of how companies can create unified talent pools of both nonpermanent and permanent workers. The majority of companies split their VMS selections from their MSP decisions. Of the 32 customer reference calls we completed for this Forrester Wave, 11 picked their VMS based on the MSP s recommendation. In the other 21 cases, the client made the decision without assistance. 4 This is a big change from several years ago, when most clients purchased bundled MSP/VMS solutions and validated the trend Forrester has been tracking to separate VMS and MSP purchases. This separation means that while customers previously didn t scrutinize VMS functionality (because it was only part of the integrated solution), the more customers select VMS solutions separately they become more critical and demanding of specific functionality. Most of Forrester s inquiries in this area also show that customers want to evaluate their VMS separately to ensure appropriate functional fit with their requirements. Vendors bolstered SOW/project capabilities. The strongest evidence of this comes from the stronger scores in SOW/project functionality compared to three years ago. 5 The suppliers have all increased their capabilities in this area as a direct response to customers that want their VMS software to manage both contingent workers hired as individuals and project-based work that

The Forrester Wave : VMS, Q1 2014 4 they previously purchased through other sourcing mechanisms. This is particularly important, as contingent workforce capability is more mature so strength in SOW/project functionality could be the difference between being considered or not by a prospective customer because many clients have yet to fully add SOW work into their contingent programs. The customer references for this report also had a far smaller percentage of SOW spend flowing through their VMSes than contingent spend and Forrester expects they ll want to increase that percentage in 2014. Market Conditions Make Vms Products Highly Competitive The VMS market is fairly mature in terms of adoption most companies Forrester speaks to have one yet the market is still very competitive, with many suppliers and heavy focus on improving functionality. And there s good reason for the vendors to fight so hard for any functional improvement they can get the opportunity to win greenfield customers is low, and most current customers seem content with their existing solution. Demonstrating these market forces, Forrester found the following while speaking to reference customers for the Forrester Wave: VMSes are still only part of a contingent workforce program. Functionality of the VMSes has consistently increased. These increases have bled into the work currently being performed by Managed Service Providers. Yet only seven reference customers didn t use an MSP. This means that it will likely take several years for VMS functionality to be enough for customers to act as their own MSP/bring management of their contingent programs in-house. VMS incumbency is strong. Customers tend to stay with their VMS suppliers. Of the 32 reference customers, 18 had been using their VMS for longer than three years. 6 Only one customer noted that if it had to pick a new VMS today it would pick a different supplier than its incumbent (ironically that customer rated its existing solution highly). Given that these are reference customers, we expect this loyalty, but these responses match what Forrester has heard from non-reference customers as well. Customers want VMS to be excellent in both contingent and SOW/project capabilities. Most of the VMS customer references reported that they used the software for both contingent and SOW/project. This means the choice of a VMS is high stakes more than five customers reporting over $1 billion in combined going through their VMS. As customers seem unlikely to split their contingent and SOW between two different VMS, any vendor that isn t good at both areas is likely to be quickly removed from bid consideration. Relative to this last point, today, most suppliers are only somewhat less competent at SOW than at contingent functionality. However, given that most clients still want to understand the differences, Forrester has created two separate Forrester Wave graphics one for contingent functionality and

The Forrester Wave : VMS, Q1 2014 5 one for SOW/project functionality. Customers that are looking for combined solutions should customize the weightings in the Forrester Wave Excel tool to create a unified view. Vms Evaluation Overview To assess the state of the VMS market and see how the vendors stack up against each other, Forrester evaluated the strengths and weaknesses of top VMS vendors. Given the differences between contingent and SOW/project functionality, Forrester has created two separate Forrester Wave models for clients to evaluate as clients may want a provider to do only one or the other. VMS Evaluation Criteria After examining past research, user need assessments, and vendor and expert interviews, we developed a comprehensive set of evaluation criteria. We evaluated vendors against 85 criteria, which we grouped into three high-level buckets: Current offering. This includes capabilities for both contingent worker capabilities and SOW/ project (also called services procurement) functionality. We also evaluated functionality that crossed both contingent and SOW/project, like implementation, architecture, usability, reporting, and customer references, among others. These two areas have been segmented into two separate Forrester Wave graphics. Strategy. We evaluated the vendors ability to articulate a vision for how the market would evolve and how well their product road maps align to that vision. Market presence. Total revenue, revenue growth, VMS product revenue, and customer growth were the primary criteria used to evaluate market presence. Evaluated VMS Vendors Forrester included 10 vendors in the assessment: Beeline, DCR Workforce, Fieldglass, IBM, IQNavigator, Peoplefluent, PRO Unlimited, ProcureStaff, Provade, and ZeroChaos. Each of these vendors has (see Figure 2): A comprehensive and standalone VMS offering. Evaluated vendors were required to have a VMS product with cross-industry appeal and specific SOW/project-based functionality, in addition to contingent staffing capabilities. We also required that the VMS product be available separately from any MSP offering the supplier might have, although in some cases the providers prefer not to offer separately. Significant market presence or innovative solutions. We considered vendors on dimensions of revenue, employees, and the size of their networks in terms of customers, partners, and installed

The Forrester Wave : VMS, Q1 2014 6 base. Furthermore, we included providers that were innovators in developing new approaches to meeting VMS needs. Strong customer interest. Through Forrester inquiries, consulting, media requests, and ongoing conversations with players in the market, we developed an understanding of demand for the vendors and solutions included in this evaluation. Figure 2 Evaluated Vendors: Product Information And Selection Criteria Vendor Product evaluated Product version evaluated Version release date Beeline Beeline VMS 8.2 August, 2013 DCR Workforce Smart Track 10.1.07 June 30, 2013 Fieldglass Fieldglass Jul-13 July 14, 2013 IBM IBM Emptoris Services Procurement 10 May 31, 2013 IQNavigator IQNavigator 11.2 Not provided Peoplefluent Peoplefluent VMS 11.2 August, 2013 PRO Unlimited WAND X April, 2012 ProcureStaff Technologies (purchased by IQNavigator in January, 2014) Consol 4.5 July, 2013 Provade Provade VMS N/A August, 2013 ZeroChaos ZC Web N/A Not provided Inclusion criteria VMS product has both contingent staffing and SOW/project capabilities. VMS product is available separately from any MSP offering the supplier might have. (Although in some cases the providers prefer not to offer separately). VMS product has cross-industry appeal. Demonstrated market presence and customer interest. Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 7 High Expectations And A Crowded Market Make A Strong Vms Space As vendors fight to try and win over customers from incumbent suppliers, VMS functionality improves significantly. This race to improve leads to a certain similarity in functionality not that all suppliers score equally in each criterion, but that on average, the variation among the best-to-worst in any area is fairly small. The similarity among solutions is mirrored by a similarity of vendor vision for where the market is heading. The most significant difference between this Forrester Wave and the prior version was the increased similarities in strategy scores. It s simply much more difficult now to have a very different strategy from competitors, because the vendors and customers all seem to share similar perspectives. The evaluation uncovered a market in which (see Figure 3 and see Figure 4): Fieldglass, Beeline, IQNavigator, DCR Workforce, IBM, and Peoplefluent lead the pack. These suppliers all have very strong capabilities and are good choices for firms that want the full package of both contingent and SOW/project functionality. In a space where most customers have an existing VMS, the question often is what does the competitor offer that s worth switching for? Each of these suppliers has at least one standout capability that makes them worthy of consideration not just for greenfield situations but for replacement situations. PRO Unlimited, ProcureStaff, and Provade offer viable alternatives. The suppliers in the strong contender category offer solid products, with solid functionality for the majority of customers. Due to the highly competitive nature of the category, these vendors suffer not from weaknesses per se but from lack of a rockstar capability. This means they ll be stronger in greenfield situations but at a disadvantage in replacement situations because there s no real reason a client would replace its existing system for similar, but not noticeably better functionality. ZeroChaos average offering suffers most from strong competition. The competition in this space is fierce, and ZeroChaos product is good just not as good as the other suppliers evaluated. It has average scores across the board, neither horrendously bad nor standout-good. As a result, the solution will need to become more robust to entice customers when there are so many other strong options available. This evaluation of the VMS market is intended to be a starting point only. We encourage clients to view detailed product evaluations and adapt criteria weightings to fit their individual needs through the Forrester Wave Excel-based vendor comparison tool.

The Forrester Wave : VMS, Q1 2014 8 Figure 3 Forrester Wave : VMS SOW/Project Capabilities, Q1 14 Strong Risky Strong Bets Contenders Performers Leaders Current offering Beeline IQNavigator ProcureStaff PRO Unlimited Provade ZeroChaos Fieldglass IBM DCR Workforce Peoplefluent Go online to download the Forrester Wave tool for more detailed product evaluations, feature comparisons, and customizable rankings. Market presence Weak Weak Strategy Strong Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 9 Figure 3 Forrester Wave : VMS SOW/Project Capabilities, Q1 14 (Cont.) Forrester s Weighting Beeline DCR Workforce Fieldglass IBM IQNavigator Peoplefluent PRO Unlimited ProcureStaff Provade ZeroChaos CURRENT OFFERING Functionality: CWM/VMS Usability Reporting Architecture Implementation Return on investment (ROI) Reference results Customer advocacy program Functionality: project-based/ SOW services 5 15% 15% 5% 5% 4 4.33 3.90 3.91 3.98 4.11 4.50 4.05 3.80 3.76 4.22 4.68 4.40 4.40 4.70 4.13 4.07 4.10 3.90 4.40 4.57 3.97 4.41 3.70 3.30 4.11 3.18 3.41 3.30 2.78 3.20 4.50 3.45 2.90 2.86 3.48 3.54 3.60 3.40 3.47 3.19 3.17 3.10 3.30 3.30 3.33 2.80 3.06 3.55 2.30 2.30 2.69 STRATEGY Talent management Contract management Product strategy: CWM/VMS MSP Staffing company neutrality Pricing flexibility: project-based/sow services Product strategy: project-based/sow services MARKET PRESENCE Overall profitability Overall revenue Overall revenue growth Spend under management Software revenue Software revenue growth Employees Installed base: CWM/VMS Global presence Installed base: project-based/sow services 5 5 15% 35% 3.85 3.35 3.85 2.20 4.10 4.15 3.15 2.50 3.35 4.50 4.05 2.90 2.50 2.85 2.55 2.50 1.50 1.50 2.35 3.20 2.50 All scores are based on a scale of 0 (weak) to 5 (strong). Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 10 Figure 4 Forrester Wave : VMS Contingent Capabilities, Q1 14 Strong Risky Strong Bets Contenders Performers Leaders Current offering ZeroChaos Beeline Fieldglass DCR Workforce IQNavigator IBM Peoplefluent ProcureStaff Provade PRO Unlimited Go online to download the Forrester Wave tool for more detailed product evaluations, feature comparisons, and customizable rankings. Market presence Weak Weak Strategy Strong Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 11 Figure 4 Forrester Wave : VMS Contingent Capabilities, Q1 14 (Cont.) Forrester s Weighting Beeline DCR Workforce Fieldglass IBM IQNavigator Peoplefluent PRO Unlimited ProcureStaff Provade ZeroChaos CURRENT OFFERING Functionality: CWM/VMS Usability Reporting Architecture Implementation Return on investment (ROI) Reference results Customer advocacy program Functionality: project-based/ SOW services 5 4 15% 15% 5% 5% 4.17 4.33 3.90 3.91 4.12 4.11 4.50 4.05 3.80 3.76 4.44 4.68 4.40 4.40 4.70 4.13 3.89 4.10 3.90 4.40 4.57 4.09 4.41 3.70 3.30 4.11 3.43 3.41 3.30 2.78 3.25 4.50 3.45 2.90 2.86 3.51 3.54 3.60 3.40 3.47 3.13 3.17 3.10 3.30 3.30 3.33 2.95 3.06 3.55 2.30 2.30 2.69 STRATEGY Talent management Contract management Product strategy: CWM/VMS MSP Staffing company neutrality Pricing flexibility: project-based/sow services Product strategy: project-based/sow services 5 5 15% 35% 3.85 4.15 3.85 4.05 3.20 MARKET PRESENCE Overall profitability Overall revenue Overall revenue growth Spend under management Software revenue Software revenue growth Employees Installed base: CWM/VMS Global presence Installed base: project-based/sow services 3.35 2.20 4.10 3.15 2.50 3.35 4.50 2.90 2.50 2.55 2.50 1.50 1.50 3.20 2.50 All scores are based on a scale of 0 (weak) to 5 (strong). Source: Forrester Research, Inc.

The Forrester Wave : VMS, Q1 2014 12 Vendor Profiles Leaders Fieldglass provides the user with a deep benchmarking experience. Fieldglass is a standalone software company with no ties to an MSP or staffing agency. The company s VMS product, also called Fieldglass, has over $27 billion in spend under management and customers in 101 countries, making it the largest and most geographically adopted solution evaluated in the Forrester Wave. Fieldglass is the most commonly mentioned vendor by both MSPs and customers. Its overall capabilities in both contingent staffing and SOW/project are very strong, and it has a good vision that companies can manage all of their nonpermanent staff as a unified pool of talent. The vendor s deep commitment to rate benchmarking and process benchmarking will make it a good fit for customers looking for more rigorous tracking of ROI from their contingent labor/services procurement efforts. Beeline offers strong contingent staffing capabilities and analytics reporting. Beeline is the name of both the company and the product. The company is owned by staffing agency Adecco and has a sister MSP company called Pontoon, but maintains separate management and operations. The Beeline VMS has more than $13 billion in spend under management, with customers in 54 countries. Mentioned by most MSPs and prospective customers when considering a VMS product, Beeline offers a strong product, with roughly comparable capabilities across contingent staffing and SOW/project areas. The company s determination to make analytics a cornerstone of the product functionality makes Beeline appropriate for companies that want a more thorough data-based approach to their contingent programs. IQNavigator excels in mobile capabilities. IQNavigator, and its product of the same name, reports $17 billion in spend under management and customers in 47 countries. The company also offers MSP services but sells the software separately only 3 of its VMS customers also use the company s MSP services. IQNavigator has the second-most spend under management, and is widely mentioned by MSPs and customers. IQNavigator s strong functionality is bolstered by its above-average mobile capability. The company is a good fit for customers with high numbers of mobile workers or mobile managers that need to approve different workflows remotely. After Forrester s evaluation, IQNavigator acquired ProcureStaff. Both products are kept separate in the Wave, as the acquisition occurred after the evaluation data was gathered. DCR Workforce scores highest marks in customer experience. One of the smallest providers evaluated, DCR Workforce performed admirably among much larger competitors. DCR Workforce has an MSP offering, but customers can purchase only the VMS product, Smart Track. The VMS has $800 million in spend under management and customers in eight countries. Smart Track is solid in SOW/project, and strong in contingent. It also received excellent scores from customer references. DCR Workforce should be considered by companies that want to work with a smaller supplier, and want to start small before ramping up their programs over time.

The Forrester Wave : VMS, Q1 2014 13 IBM has very strong SOW capabilities and integrates well with other IBM products. IBM s Emptoris Services Procurement product is the only software that is offered in an on-premises version. IBM would not disclose the amount of spend under management. The product is being used by customers in 55 countries. IBM Emptoris Services Procurement is part of a larger suite of IBM Emptoris eprocurement products but the company has no ties to an MSP or staffing agency. Through its Smarter Workforce initiative, IBM offers an excellent vision of how companies can look more strategically at their overall talent pool to make better decisions about what should be done by permanent employees versus contingent employees versus project work. IBM Emptoris Services Procurement functionality is very good across the board but scored higher in its SOW/ project capabilities than in its VMS capabilities. IBM Emptoris is a good fit for companies that want SOW/project functionality only, or want to integrate with other IBM products. Peoplefluent complements its VMS with a comprehensive HR application suite. Peoplefluent has no ties to any MSP or staffing agency, but its VMS tool is part of the company s broader HR apps portfolio. The product has $7 billion in spend under management and customers in nine countries. As a result of being more aligned with HR teams than sourcing ones, Peoplefluent offers a strong view of how VMS plays a role in a unified view of talent. However, the product s SOW/ project capabilities are not as strong as the contingent capabilities. The company s product road maps demonstrate alignment with the broader talent vision, and in its November 2013 release it included a Wizard that helps firms make decisions about whether to use contingent or SOW resources (a functionality that Forrester graded the firm poorly on in this edition of the Forrester Wave because we only included functionality that was already available at time of demonstration). Strong Performers ProcuresStaff distinguishes itself by offering dedicated account teams. ProcureStaff has two sister companies, MSP Volt Consulting Group and staffing agency Volt Workforce Solutions. It maintains separate management and IT operations. ProcuresStaff s VMS product Consol has $1.4 billion in spend under management and customers in 25 countries. Consol s functionality is solid in both contingent and SOW/project functionality, and it received higher than average customer scores. The company focuses efforts on its dedicated account teams as a way to differentiate itself from competitors and is a good fit for companies looking for that type of approach. After Forrester s evaluation, ProcureStaff was acquired by IQNavigator. Both products are kept separate in the Wave, as the acquisition occurred after the evaluation data was gathered. PRO Unlimited is a viable option for companies that want both a VMS and an MSP. PRO Unlimited prefers not to separate its WAND VMS tool from the company s broader MSP offering but will do so in limited circumstances. The company reports that almost all of its VMS customers use its MSP services also. WAND has customers in 61 countries and almost $4 billion in spend under management. WAND received above-average client reference scores. WAND s solid contingent functionality makes it a good option for companies that capability only, or prefer combined VMS/MSP solutions.

The Forrester Wave : VMS, Q1 2014 14 Provade performs well in SOW capabilities. The vendor is owned by staffing agency Pinnacle Technical Resources, but has a separation agreement with its parent that ensures no customer transaction data are shared. Provade has customers in 35 countries. The vendor s capabilities are solid, and Provade is one of the few products to score higher in SOW/project capabilities than in contingent functionality. The company would benefit from improving in a few areas like service catalogs but is a good fit for firms with limited programs and looking for a smaller firm. Contenders ZeroChaos offers bundled VMS/MSP with good benchmarking capabilities. ZeroChaos offers MSP services, and 9 of VMS customers also use the MSP offering. The VMS has $2.5 billion in spend under management and customers in 33 countries. Both its contingent and SOW/project scores qualify it for contender status. Its rate benchmarking capabilities are very good, but it could benefit by improving weaknesses in areas like rules-based categorization and when its mobile capabilities become available (the supplier s mobile functionality was not available at the time of evaluation). The company is an option for smaller firms that would prefer to have a bundled VMS/MSP offering. Supplemental Material Online Resource The online versions of Figure 3 and 4 are Excel-based vendor comparison tools that provide detailed product evaluations and customizable rankings. Data Sources Used In This Forrester Wave Forrester used a combination of three data sources to assess the strengths and weaknesses of each solution: Vendor surveys. Forrester surveyed vendors on their capabilities as they relate to the evaluation criteria. Once we analyzed the completed vendor surveys, we conducted vendor calls where necessary to gather details of vendor qualifications. Forrester s Q3 2012 Global Sourcing and Vendor Management Priorities Survey was fielded to 186 sourcing and vendor management professionals with at least one year experience. Forrester fielded the survey in September 2012. Respondent incentives included a summary of the survey results. Exact sample sizes are provided in this report on a question-by-question basis. These samples are not guaranteed to be representative of the population. Unless otherwise noted,

The Forrester Wave : VMS, Q1 2014 15 statistical data is intended to be used for descriptive and not inferential purposes. We have illustrated only a portion of survey results in this document. For access to the full data results, please contact Forrsights@forrester.com. Product demos. We asked vendors to conduct demonstrations of their product s functionality. We used findings from these product demos to validate details of each vendor s product capabilities. Customer reference surveys. To validate product and vendor qualifications, Forrester also conducted reference surveys with three-to-four of each vendor s current customers. The Forrester Wave Methodology We conduct primary research to develop a list of vendors that meet our criteria to be evaluated in this market. From that initial pool of vendors, we then narrow our final list. We choose these vendors based on: 1) product fit; 2) customer success; and 3) Forrester client demand. We eliminate vendors that have limited customer references and products that don t fit the scope of our evaluation. After examining past research, user need assessments, and vendor and expert interviews, we develop the initial evaluation criteria. To evaluate the vendors and their products against our set of criteria, we gather details of product qualifications through a combination of lab evaluations, questionnaires, demos, and/or discussions with client references. We send evaluations to the vendors for their review, and we adjust the evaluations to provide the most accurate view of vendor offerings and strategies. We set default weightings to reflect our analysis of the needs of large user companies and/or other scenarios as outlined in the Forrester Wave document and then score the vendors based on a clearly defined scale. These default weightings are intended only as a starting point, and we encourage readers to adapt the weightings to fit their individual needs through the Excel-based tool. The final scores generate the graphical depiction of the market based on current offering, strategy, and market presence. Forrester intends to update vendor evaluations regularly as product capabilities and vendor strategies evolve. For more information on the methodology that every Forrester Wave follows, go to http://www.forrester.com/marketing/policies/forrester-wavemethodology.html. Integrity Policy All of Forrester s research, including Forrester Waves, is conducted according to our Integrity Policy. For more information, go to http://www.forrester.com/marketing/policies/integrity-policy.html.

The Forrester Wave : VMS, Q1 2014 16 Endnotes 1 Source: Forrsights Budgets And Priorities Tracker Survey, Q4 2012. 2 We asked 32 respondents, What need(s) or business requirement(s) drove you to adopt a VMS? (select all that apply). Source: 2013 Global Online VMS Survey. 3 For more on MSPs and contingent staffing, see the October 23, 2013, Increasing The Value Of Contingent Staffing MSPs report. 4 We asked 32 respondents, Did you select the VMS on your own, or implement the VMS recommended by an MSP? Source: 2013 Global Online VMS Survey. 5 To compare against the last Forrester Wave in this space, see the September 30, 2010, The Forrester Wave : Services Procurement Q3 2010 report. 6 We asked 32 respondents, How long have you been using this specific VMS software? Source: 2013 Global Online VMS Survey.

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