Managed Services Provider or Recruitment Firms: What’s Best for You?

Finding the right employees is key to growing your organization, but it can be really tough with today’s talent shortages and skills gap.  

This is where getting help from outside experts can make a big difference. You have two main choices: you can either work with a Managed Services Provider (MSP) or a recruitment firm. 

It's important to know how these two options differ, especially when it comes to what they can offer in the long run. Both MSPs and recruitment firms can help you find the right people, but they go about it in different ways. 

In this blog, we’ll break down what each option offers, the benefits they bring, and how to decide which is the best for your organization. 

Read: 5 Major Benefits of Outsourcing to the Philippines 

Understanding Managed Services Provider 

Simply put, a managed services provider (MSP) is an external outsourcing company that specializes in managing and overseeing specific business operations while providing essential services to clients. Typically, MSPs are hired on a long-term basis to handle critical day-to-day tasks and effectively act as an extension of an organization’s in-house team. 

MSPs often provide end-to-end solutions to their clients, which means they handle all tasks needed to build and manage a team from start to finish. This includes recruitment, onboarding, training, performance management, other admin-related duties and even handling employee issues. 

The services they provide also vary, which include: 

• Finance and Accounting Support: (Bookkeeping, payroll, tax preparation, and financial reporting) 

• IT Support: (Connectivity, networking, data backup, and recovery) 

• HR Support: (Recruitment, payroll processing, and benefits administration) 

• Data Entry and Processing Support: (Data input, management, and organization) 

• Customer Service Support: (Help desk, and CRM management) 

• Web Design and Development Support: (Website creation, updates, and maintenance) 

• Software Development Support: (Custom software, system integration, and maintenance) 

What Does an Outsourced MSP Do? 

A managed service provider takes care of every aspect of the outsourced function, as follows: 

Finding the Right Talents 

MSPs start by hunting for the best candidates for your job openings. They use different ways and strategies to attract people who will fit well with your organization. 

Screening Candidates      

An MSP can also take care of the entire recruitment process, from screening resumes to interviewing candidates. They can even handle background checks and reference checks for your organization. 

Of course, it’s still upon your discretion if you plan to get involved — such as interviewing candidates and picking your preferred staff — or you’re comfortable with entrusting the entire screening and selection process to the service provider.     

Facilitating training and development opportunities       

An MSP also provides training and development opportunities for your new hires to ensure they can keep up with your expectations and be more familiar with your business and processes at the same time. 

Keeping Track of How Employees Are Doing 

After hiring, MSPs can help keep an eye on staff performance based on the key performance indicators (KPIs) you’ve outlined. They can also set up regular check-ins and give feedback to make sure everyone is on track and doing well. 

Staying Compliant 

MSPs are aware of the legal stuff about hiring and employee management and they make sure that your company remains compliant, helping you avoid potential legal issues and costly penalties to government authorities. 

Taking Care of Administrative Needs 

Beyond personnel management, an MSP ensures that all administrative needs are met. This includes handling equipment procurement, managing essential software, overseeing payroll processes, and arranging suitable office space, among other tasks. 

You might be interested: Due Diligence in Outsourcing Accounting Services 

Benefits of Working with Managed Services Providers 

Aside from the practical support you can get from them, here are some of the benefits that MSP can offer to your organization: 

1. Access to Certified Professionals 

One good thing you can gain from reaching out to an MSP is that you can have access to their specialists who can potentially meet your organization's needs.  

In cases where any of their employees aren’t fit for the job, MSPs can manage the sourcing and recruitment process based on your requirements, ensuring you can work with the right staff when needed. 

Plus, these third-party providers are always updated with the latest technology, practices, and trends, which can benefit your organization. 

2. 24/7 Monitoring and Support 

Another thing to consider is that many MSPs provide round-the-clock monitoring and support, which can differentiate you from your competitors. With constant support, your clients can receive immediate attention, addressing any issues in real-time. 

3. Scalability and Flexibility 

As your organization grows, so do your needs. Good thing, MSPs can quickly scale up or down their services to accommodate changes within your organization, whether it needs support during a busy season or scaling back during slower periods. This flexibility only means that you can avoid paying for services that aren’t being used and save money in the process. 

4. Prioritize Core Business Functions 

When an MSP takes over everyday tasks like managing IT or payroll, you and your team can focus on the parts of your organization that need your direct attention and expertise such as developing new products or services. 

What’s a Recruitment Firm? 

A recruiting firm, otherwise known as a staffing agency or employment agency, helps connect businesses with potential employees. Their main job is to help organizations find the right candidates for their job openings by understanding what each business needs. 

Unlike Managed Services Providers (MSPs), which take full responsibility for managing a specific business function or process, recruitment firms are primarily focused on sourcing talent. 

Benefits of Reaching out to Recruitment Firm 

Here are some of the benefits of reaching out to recruitment firms: 

1. Reduce Hiring Risk

Many recruitment firms offer guarantees, meaning if the candidate they find doesn’t work out within a certain time, they’ll find a replacement at no extra cost. This means it will not affect your operation if you hire someone who doesn’t work out.  

 2. Access to Talent Pool

Recruitment firms have access to a wide network of candidates, including those who aren’t actively looking for work but might be interested in your offer. 

3. Time-Saving

By handling the initial stages of recruitment – from screening and interviewing to reference checks – recruitment firms can save your organization a considerable amount of time and effort in finding a qualified candidate. 

Comparing Managed Services Providers and Recruitment Firms 

Here's the table comparing managed services providers and recruitment firms: 

Choosing Between Managed Services Providers and Recruitment Firms 

The decision largely depends on your organization’s goals. If your primary need is increasing operational efficiency and handling multiple functions, a managed services provider may be the right choice. However, if your focus is solely on optimizing your talent acquisition process, a recruitment firm could be the better option. 

When evaluating these two options, consider the scale of your operations, budget constraints, and the specific challenges you aim to address. This way, you can make a smart decision that aligns well with your organizational needs. 

Read Next: A Comprehensive Guide to Accounting Outsourcing Services 

Ready to Find the Right Accounting Outsourcing Partner for Your Organization? 

When it comes to outsourcing your accounting needs, D&V Philippines specializes in providing ongoing support through managed accounting services. If you're looking for a reliable partner to streamline your financial operations, we’re here to help. Contact us today to explore how our finance and accounting outsourcing solutions can meet your specific needs and set your business up for success! 

You may also download  Outsourcing: How to Make it Work guide today to give you a better understanding of how we can be your reliable outsourcing partner.