Ford spent millions of dollars per year for agency and purchase service employees and no one really cares to look into the savings that can be obtained. Management should be looking into the cost savings for the company, simply by being proactive and efficient.
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@8rnm I agree agency pay can be low @ Ford. In IT it is hard to bring in decent contractors because the hourly pay is so low. Purchased Services is different those hourly rates are often in 200-250 per hour. Agency more typical in the 40-55 per hour. Sometimes agency as high as 65 per hour, but rare.
I agree with 8nrm for the most part, but the Agencies share some of the blame too. they keep way too much of a percentage of the billing rate for themselves for doing nothing. When I was agency, over 50% went into their pocket for doing nothing more than submitting resumes to clients and firing employees that the client didnt want. You want to save money? Figure out a way to get rid of the agency middle man. The employee automatically gets more of their salary and the billing rate goes down.
$200k/year for agency? What planet are you from? Even with the agencies adding on their overhead rates to an agency person’s rate, it’s not even close to $200k/year. In my position, see agency, purchased service, and employee hourly rates. Ford is notorious for paying some of the lowest agency rates in the Midwest.
Also Ford has cut agency rates so many times over the past 25 years that you have a lot of long term agency folks who have had their salaries cut several times despite being the ones pulling the weigh for their slacker employee coworkers. It’s always the same pattern. First Ford claims it is not doing well financially, pressures the agencies into dropping rates, then after agency resources get pay cuts (with promises from Ford to agency that the rates will return after the “financially challenging” time), a few months later Ford announces the most profitable quarter or year in history, pays bonuses to employees, but agency resources never get their original pay rate back. I’ve personally seen that happen 4 separate times.
Agency employees only qualify for an increase once every 2 years, but Ford has to approve the increase. They RARELY, if ever, agree to the rate increase. Therefore, most agency resources at Ford (especially the long-termers) are making much less now, to do the same or more work/responsibility than when they first started on the account.
I personally know several agency resources in that scenario. One agency resource in particular has been there as a top performer for 20 years, and honestly should have been hired directly by Ford a long time ago based on her performance and contributions, but she is currently making only 65% of what she made when she first started there due to Ford’s agency rate cuts over the years. Every 2 years when her rate increase window is valid, there’s always some budget freeze or cost-cutting BS given by Ford as an excuse for why her rate can’t be increased. Note she is a top performer year after year and is not even at the top of her position’s billing rate.
Ford has a long history of playing games with it’s agency and purchased service providers and resources. Word has spread and now it’s difficult to find new, good quality, agency and purchased service resources to work on the Ford account. Those who do agree to go to Ford end up jumping ship as soon as a higher rate offer is made to them from another account or employer. No one wants to be assigned to Ford any longer. There is no financial or perk, such as work at home, incentives to draw agency to Ford especially when other accounts are offering those perks, higher rates, and regular increases.
Are we really asking the top knobs in the company to think? Really? Your joking right? These id--ts get to where they are because they are selfish and only think of themselves. Departments are constrained with headcount, so the only way to do work is through a Purchase Service. PS do not fall under headcount. So these managers show that they have delivered, with less headcount, when in fact they are spending so much with PS, but are not on the books. Don’t ever think that a manager is going to look after the business.
Consulting & outsourced services are a lower cost model than FTE's (healthcare, pension, etc).
OP I am not an agency or purchased service. The reason for these is some Ford teams can’t/won’t do the work. The expensive people are the non-contributory Ford employees and the leaders who hide the team problems. Any Ford project or team that requires ongoing purchased services or agency or consultants ought to be investigated and the deadwood removed. It is an indicator of underlying team problems. Deadwood accumulates in teams. SIRP did not touch deadwood.
Under my manager
28 non-contributing employees @ 100k per year excluding benefits =2.8million a year
3 consultants doing the work @ 200k per year = 600k per year
The 28 non-contributing employees have been non-contributors for most of their career.
546 years @ 100k per year excluding benefits = 54.6 million = The cost of not hiring and retaining the right employees.
Just saying
@220k/year billing rate I'd say your on to something