In a post yesterday by Jason Busch on Spendmatters.com, YOH - Crossing an Ethical Boundary as an MSP?, the question of ethics in Managed Service Provider ’s (MSP) conduct arose. In the article, Jason stated that YOH, an MSP based in Philadelphia, would provide preferential treatment to staffing vendors that were part of their partnership program. Membership in this program came at a cost and depending on the amount you paid, members would receive valuable benefits, including priority review of staffing opportunities before other firms.

How does this differ from paying an employee to recruit talent, yet solicits kickbacks from candidates? YOH’s customers are hiring them to perform a service just as an employee is.

How can you make sure not to get caught in the squeeze play? Asking MSP’s the following questions will help you identify ethical and/or financial risks. It probably goes without saying, but I would recommend that any future MSP contract address these issues formally.

Ask all current and potential MSPs:

1. Do you have any partnership programs with staffing vendors? Do any of these programs give an advantage to any staffing vendor?
2. Do you also have your own staffing agency? Explain to me how your processes and technology put a separation between your MSP personnel and your staffing division?
3. Will you use my Vendor Management System (VMS) where I can control access and visibility?
4. How can I audit the rate markups and candidates to be sure I am receiving the best value along with ensuring your financial viability?

Armed with this information, you and your MSP will hopefully have a trustworthy and mutually beneficial partnership.

Dan Ashton is Senior Solutions Marketing Manager, responsible for Services Procurement & Content, at Ariba.