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Case 2: The Pros and Cons of Flexible Staffing
Candice Mark
School of Business, Liberty University
Author Note
Candice Mark
I have no known conflict of interest to disclose.
Correspondence concerning this article should be addressed to Candice Mark.
Email: cmark2@liberty.edu
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The Pros and Cons of Flexible Staffing
Question 1: A summary of the possible advantages and disadvantages of flexible staffing.
Flexible staffing is a practice used to quickly fill up job vacancies within a company
during changes in technology, consumer demand, current workforce expectations, and to the
fluctuating demand for products and services (Heneman III, Judge, & Kammeyer-Mueller,
2019). The flexible form of employment is an alternative to traditional employment methods,
largely resulting from the need to adapt to new work conditions, skills, and expectations by
parties on both sides of the employment question (Kaźmierczyk & Chinalska, 2018). Under this
type of employment, a company can obtain flexible staff, temps, or temporary-to-permanent
employees from a staffing firm or hire an independent contractor to maintain its staffing levels
(Heneman III, Judge, & Kammeyer-Mueller, 2019). In order to determine whether a flexible
workforce is required, it is essential to perform an analysis of its advantages and disadvantages.
Advantages of Flexible Staffing
Flexible staffing is advantageous to KMC in terms of i) flexibility, ii) cost, and iii) inflow
of new skills, knowledge, and expertise (Heneman III, Judge, & Kammeyer-Mueller, 2019).
Firstly, flexible staffing allows KMC to hire employees only when required, typically when
orders come in erratically and demand fluctuates, i.e., by maintaining only a reduced core
workforce and hiring extra employees temporarily during peak periods of demand (Heneman III,
Judge, & Kammeyer-Mueller, 2019; Kotey & Sharma, 2015). Secondly, temporary workers are
much less expensive while providing the same skills as the permanent workforce (if the hiring
practices are thorough and a suitably match to the company’s needs), since they would not fall
under the KMC’s own payroll and subsequently eliminate training and benefits costs (Heneman
III, Judge, & Kammeyer-Mueller, 2019; Kotey & Sharma, 2015). Thirdly, today’s temporary
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workforce is largely comprised of younger individuals belonging to the new generation, who
possess a completely different approach to work values, skillsets, and outlooks (Barrett, 2018;
Kaźmierczyk & Chinalska, 2018). The presence of a temporary workforce comprising of such
individuals does two things to spark change and increase productivity and innovation in a
company – a) the temporary professionals and technical staff bring with them fresh perspective,
skills that match the current trends, and new information that may not be present in the existing
workforce, and b) they compel the core workforce to compete with the ‘new guys’, motivating
them to expand their skills and willingness to accept change (Heneman III, Judge, & Kammeyer-
Mueller, 2019; Kotey & Sharma, 2015).
Disadvantages of Flexible Staffing
The most common drawback of flexible staffing involves the temporary workers’ pitting
their own wages, benefits, working conditions, job content, and career development against that
of the permanent staff (Imhof & Andresen, 2017). For instance, research has shown that
temporary workers do not perform as well as full-time staff because the very nature of their
position makes them compare their perceived lack of ‘equal treatment’ (in terms of benefits, job
quality and decision-making power), causing a consequent lack of commitment to the hiring
company which ultimately reduces their productivity (Jung et al., 2018; Kotey & Sharma, 2015;
Heneman III, Judge, & Kammeyer-Mueller, 2019).
Secondly, the company has to legally forgo full legal control (in terms of performance
management or supervision) over the temporary workforce, since these workers belong to the
payrolls of either the staffing firm or independent contractors (Kotey & Sharma, 2015; Heneman
III, Judge, & Kammeyer-Mueller, 2019). Thirdly, the company is caught in a triangle with the
temporary workforce and the staffing agency/contractor – managerial complexity increases as
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managers are caught between the the demands of hired temps, existing staff, as well as the
staffing agency/contractor (Svensson et al., 2015). Lastly, in connection with the previous point,
as temporary positions are increasingly being filled by highly qualified professionals, the
company may be obligated to indulge those temporary workers holding key titles almost as much
as its permanent workforce in terms of job quality, benefits, and HR activities (Imhof &
Andresen, 2017), if it hopes to obtain a high standard of work and productivity from its
combined workforce.
Question 2: A summary of the advantages and disadvantages of using FSS as a service
provider.
Advantages of Using FSS
The main advantage of adopting the staffing solutions proposed by Flexible Staffing
Services (FSS) is that KMC will be able to hire temporary workers during the seasonal peaks in
demand common to the agriculture industry. This will benefit the company better than having a
permanent workforce year-round because the fixed labor costs associated with maintaining a
core workforce are too high, given the permanent staff are idle during the off-season. By hiring
temps in the production and technical positions, KMC will be able to reduce their overheads and
instead pay only variable costs. Furthermore, the labor costs of flexible staff are already lower
than of permanent staff, considering their wages and benefits will be taken care of by FSS.
Following this line of reasoning, FSS will also be managing the administrative burden of the new
temps along with handling any taxation and litigation duties connected to the temporary hires
(Heneman III, Judge, & Kammeyer-Mueller, 2019).
Disadvantages of Using FSS
There are a few drawbacks to hiring temporary staff from FSS. Firstly, KMC will have to
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relinquish its control over its temporary staff to FSS, which is never advisable for senior-level
positions. Positions higher up in the organizational hierarchy require a certain amount of loyalty
and commitment to the company, which a temporary worker rarely demonstrates towards the
client company (Kotey & Sharma, 2015). Tying into this concern is the fact that outsourcing
highly skilled work to temporary workers can result in a brain drain when these workers reach
the end of their contracts and decide to leave KMC (Dunne, 2007), since retaining these
employees will lead to permanent hires which is an added cost, according to FSS’s pricing model
(Heneman III, Judge, & Kammeyer-Mueller, 2019). Furthermore, since this is the first time
KMC will be hiring temporary staff, the company must expect an initial drop in productivity,
employee dissatisfaction, and managerial complexity due to the forced association and
confrontation of the core workforce with the new temps (Heneman III, Judge, & Kammeyer-
Mueller, 2019; Imhof & Andresen, 2017; Svensson et al., 2015).
Question 3: A summary of the type of additional information you recommend gathering
and using as part of the decision-making process
To better determine whether or not FSS is a good bargain for KMC’s staffing issue, it
would be necessary to perform a cost-benefit analysis (including the costs of training on the job
and brain drain). This will help KMC narrow in on the costs associated with hiring a temporary
worker from FSS using their pricing model. If the price for hiring temps using FSS is found to
make very little difference than if KMC were to hire permanent workers, KMC can present this
analysis to negotiate further with FSS and bring down the price to a more profitable level
(Heneman III, Judge, & Kammeyer-Mueller, 2019).
Secondly, KMC will need to conduct a job analysis of each of its 5 positions, specifically
its production, clerical, technical, engineering, and managerial roles. In doing so, KMC will be
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able to determine for each job the key skills required along with skill availability in the market
(Heneman III, Judge, & Kammeyer-Mueller, 2019). If these skills are both easily available and
teachable, the company can consider outsourcing those jobs to the temporary workers. However,
if the skills for a certain job are not readily available in the market, or if the job requires
substantial training, KMC must give these jobs to new or existing permanent workers. In this
way, KMC will be able to retain ownership and control over its staff and intellectual property
wherever most necessary.
Thirdly, upon reviewing the case, it can be seen that KMC’s sales have been stagnating at
$175 million since 2012. This is perhaps more telling of the sales department than of the
production plants. In that case, it would be necessary to first troubleshoot the problem to figure
out why KMC’s sales are plateauing, which may reveal that hiring production temps would, at
the very least, be fixing a problem that does not exist. To that effect, it may be more fruitful to
hire skilled sales temps instead of production temps, which would be more beneficial to the
company since there already exists a talent shortage in the production sector (Heneman III,
Judge, & Kammeyer-Mueller, 2019). Thus, the company must first understand the root cause
behind its flat sales and erratic orders before deciding whether or not to hire temporary staff.
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References
Barrett, N. (2018, November-December). The pros and cons of flexible staffing: Is flexible
staffing the best option for your firm? Tax Executive, 70(6), 96+. Retrieved January 30,
2021 from https://bi-gale-com.ezproxy.liberty.edu/global/article/
GALE%7CA567549023?u=vic_liberty&sid=summon#
Dunne, H. (2007). Putting balance into business: Work/life balance as a business strategy for
avoiding brain drain. Strategic HR Review, 6(6), 28-31.
https://doi.org/10.1108/14754390780001014
Heneman III, H. G., Judge, T. A., & Kammeyer-Mueller, J. D. (2019). Staffing Organizations
(9th ed.). McGraw-Hill. https://www.amazon.com/Staffing-Organizations-Herbert-
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/10.1080/09585192.2017.1384395
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Kotey, B. & Sharma, B. (2015). Predictors of flexible working arrangement provision in small
and medium enterprises (SMEs). The International Journal of Human Resource
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Kaźmierczyk, J., & Chinalska, A. (2018). Flexible forms of employment, an opportunity or a
curse for the modern economy? Case study: banks in Poland. Entrepreneurship and
Sustainability Issues, 6(2), 782-798. http://jssidoi.org/jesi/uploads/articles/22/
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Svensson, S., Vinberg, S. & Larsson, J. (2015). External workers’ perception of leadership
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