Purchasing resources for Temporary Staffing

When is Temporary Staffing Solution Right for your Business?

In an increasingly complex and dynamic business environment, companies need to become more flexible in their approach towards staffing. Temporary staffing is one of the key tools available to business organizations to manage the business operations with greater efficiency and cost-effectiveness. The flow of orders may not be consistent throughout the year for most businesses. Many businesses are seasonal in nature, which means that the pressure of work is high during the peak season and low during the off-peak season.

The most effective way to achieve high productivity with minimum staffing overheads in such conditions is to maintain an optimal combination of permanent and temporary workers. Temporary workers are hired for a specific period to meet the excess work demands during that period. Once the work pressure is relaxed and orders have been delivered as per deadlines, the organization may relieve the temporary staff to reduce its operational costs.

Benefits

Increased Production Capacity

Temporary staffing solutions help to enhance the overall production and delivery capacity of the business. If the organization has an opportunity to receive large orders that must be executed and delivered within a tight deadline, it can quickly hire temporary workers to support its existing permanent workforce. This allows the organization to maximize its production output and revenues, and make full utilization of the available business opportunities.

Lower Costs of Production

Permanent employees are usually costlier for a business because they must be paid a fixed amount of salary or wages, irrespective of the extent of work performed. In a low season, permanent employees continue to receive the same pay even though they may not have as much work to do. Temporary employees, on the other hand, are typically hired when the business season is at its peak. They are usually relieved of duty when the season is over. Furthermore, they may not receive the same perquisites and benefits as the permanent employees, and this reduces the overall employee costs further.

Hiring Workers with Specialized Skills

One of the advantages of temporary staffing is that it allows a business organization to hire workers with specialized skills that may be required to execute a particular customer’s order. Such skills may not be necessary in the ordinary course of the company’s business. Therefore, the company need not refuse an opportunity to receive an order, and it can successfully deliver the order with the help of temporary workers with a specialized skill.

Lower Administrative Overheads

Temporary workers may be the employees of a third party staffing agency. Such an agency is usually responsible for maintaining the payroll, leave, health insurance, workers’ compensation, and other human resource issues relating to such employees. This may help to reduce the administrative burden and overheads of the business organization significantly. As per the American Staffing Association, 9.7 million temporary workers are hired by U.S. staffing companies each year due to the inherent benefits of this system for business and industry.

Pitfalls

Lower Motivation of Temporary Employees

One of the downsides of temporary staffing solutions is that it becomes difficult to motivate temporary workers to perform to the best of their ability. Temporary workers are aware that they may not receive any special incentives, promotions, or recognition within the company of their temporary status. Therefore, the productivity goals of the organization may be compromised to an extent because of the lower enthusiasm of temporary workers to deliver a good performance.

Dependence on the Staffing Firm

Temporary employees are usually hired through professional staffing firms that employ such workers on their payroll. This makes a business organization heavily dependent on the credibility of the temporary staffing firm to supply good workers. Companies are usually not in a position to conduct a screening process for such workers, and they have to rely on the assurance of the staffing firm to provide honest and efficient workers.

Interpersonal Conflicts in the Organization

Temporary employees are not attuned to the environment and work culture of the organization. Therefore, the chances of conflict between permanent employees and temporary workers may be higher. It may be more challenging to achieve cohesive teamwork when there is a mix of permanent and temporary employees for a particular task.

Risk of Leaking Privileged Information

The business organization is exposed to an obvious risk of temporary workers getting access to privileged information about the business operations. Such workers may learn new skills and techniques that are exclusively developed within the organization. They may also receive access to sensitive or valuable information about product costing, pricing, and other strategies that are critical to the business in a competitive market.

Pricing

Temporary workers are usually covered under the same minimum wage laws as the permanent employees of an organization. Furthermore, the temporary staffing agencies add a considerable profit margin for themselves in terms of a fee or commission on each worker they supply. Therefore, a business organization must perform a careful cost-benefit analysis before deciding on hiring temporary employees.

The need for temporary staffing solutions has grown in recent years due to an increased price pressure and stiff competition in the global economy. However, all the pros and cons of opting for such hiring arrangement must be evaluated objectively before a business hires temporary workers. The needs of each business may vary, and this system may be more suited for some businesses than others.