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Ardent Analysis: Impact and Implications of IQNavigator and Beeline Merger

Earlier today, we posted a discussion of the merger that was announced last night between IQNavigator (“IQN”) and Beeline. This article continues that discussion with additional analysis

The global contingent workforce is growing at a rapid pace, with 38% of the average business’ workforce considered non-employee (including contractors, freelancers, professional services, etc.). And, with the “gig economy” serving as a catalyst over the past 18 months, this industry is expected to experience even more growth and progression… Innovation will be a foundational element in how global businesses manage this evolving workforce from spend, supplier, human capital, and talent management perspectives.

Innovation, at the core, is the reason why Vendor Management System (“VMS”) technology has transformed into the “nexus” of contingent workforce management (“CWM”): VMS platforms have grown and expanded to address considerable facets of CWM and other attributes that link to this industry. From talent acquisition and spend management to online staffing and compliance/risk management. Innovation in the evolving non-employee workforce tech space just became a bit more interesting with today news of the merger between VMS platforms IQN and Beeline.

Below are the impact areas from this historic transaction and what it means for the contingent workforce industry:

  • Two major industry differentiators – (A) IQN’s “Partner Ecosystem” and (B) Beeline’s self-sourcing functionality (borne from its acquisition of OnForce) – come together under a single platform. At IQN’s user conference back in April, the solution touted its expanding “Partner Ecosystem” of services, technologies, and platforms that address various facets of contemporary CWM (such as video interviewing, risk and compliance management, talent acquisition, managed services, screening, etc.) while linking back to the greater IQN tool. For Beeline, its acquisition of OnForce back in the summer of 2014 resulted in its self-sourcing functionality, which blends Freelancer Management System (FMS) and online staffing capabilities directly in the VMS offering. Under this merger, these two core differentiators become stronger, allowing users of both platforms to enhance talent engagement while addressing both core CWM components and more progressive attributes.
  • Size Matters: speaking of the partnership ecosystem, Ardent believes that more providers will now be attracted to join this large network. The most interesting attribute of IQN’s Partner Ecosystem is how it has been able to add new services and platforms on a regular basis. With Beeline in tow, more partners will line up to join the newly-merged platform that combines two of the biggest VMS providers in the industry. As the concept of a CWM technology ecosystem continues to evolve (read Ardent’s take on this notion from last year) and contributes to total workforce management, it could be interesting to note which new partners are added to IQN’s partner base now that Beeline is part of the solution.
  • Management of SOW and services becomes a joint strength under the unified platform. “Complex” contingent labor, which includes statement-of-work- and services-based work, is the biggest contingent workforce category by spend and volume. Both IQN and Beeline have been pushing SOW and services management as core strengths of each respective platform – this merger doubles down on the concept. While the firms clearly stated their intention to support both platforms, the merger could result in newly retooled SOW and services management functionality that blends the “best” from each solution, helping customers gain enhanced control over and visibility into the largest sub-category within today’s contingent workforce.
  • CWM’s “age of intelligence” becomes much more interesting if ATOM is fed more data. Unveiled at the IQNsiders event last April, IQN’s Automated Talent Ontology Machine (“ATOM”) functionality provides users with real-time, cognitive intelligence into core CWM benchmarks such as time-to-fill rates, job/labor rates, and general benchmarking of the non-employee market. This “data engine” leverages both cognitive intelligence and predictive analytics to boost a CWM program’s visibility and ability to forecast future utilization of talent. Ardent’s new State of Contingent Workforce Management research study found that Best-in-Class companies are twice as likely and three times as likely, respectively, to leverage predictive analysis and cognitive data capabilities as part of greater data-driven contingent workforce management strategies. As it is fed more data from Beeline’s vast information across its global customer base, ATOM’s impact has the potential to become that much stronger.
  • Market impact: The merger has clear ramifications across the contingent workforce technology market. The combined IQN-Beeline platform will now rival SAP Fieldglass from a customer count and transaction throughput perspective. The size of the IQN/Beeline “newco” size makes it an attractive acquisition to even larger firm like Oracle, who has long overlooked the space and IBM, which recently began a new partnership with IQN. The IQN-Beeline company should also gain some interest from Accel-KKR that owns Oildex and recently took SciQuest private. Anytime two industry leaders merge to consolidate market leadership, numerous opportunities for the other leading players in the space begin to emerge. We expect both ZeroChaos and DCR Workforce to take advantage of these new industry shifts – ZeroChaos with its long track record of blended MSP and VMS success and DCR with its expansive analytics, SOW, and gamification capabilities. These two also become the next logical industry targets for acquisition should a company like Coupa or Accel-KKR look to acquire a top technology in a fast-moving sector.  Another market consideration is if the growing online staffing/online talent platform space will see an uptick based on the upcoming expansion of Beeline’s self-sourcing functionality

Less than a decade ago, some VMS were struggling for survival, unsure of whether or not they’d be overtaken by traditional eProcurement providers in the market. As we close out 2016, the State of VMS (and all of Contingent Workforce Management for that matter) is stronger than ever. The IQNavigator and Beeline merger signals another spark in the greater wave of contingent workforce innovation. 2017 just became much more interesting…

Stay tuned to CPO Rising for more coverage of the non-employee workforce technology market and this deal specifically.

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