Flexible-Firm Model Origins The Flexible-Firm Model was proposed in 1984 by John Atkinson

Flexibility in Employment . Flexibility in employment is a concept regarding the labour market. Since perhaps the 1960s, employers have found new and innovative ways to make the size and composition of their work-forces far more flexible. These include part-time and ‘zero-hours’ contracts, sub-contracting, remote workers, and many more.

Flexibility in Work. This refers to the flexibility within the organisation itself. It can be used in discussion of work structures, such as group-work and flexible working times, and also to the implementation of new technologies which allow for a more flexible production process. These technologies and work structures allow employees to respond quickly to market changes within changing the composition of their workforce.

Applications

The model is primarily utilised by a company’s executives as a response to the state of the market. Flexible-Firm is often used as a guideline when the company is required to make cuts to the workforce, whilst retaining its talent to stay competitive. For example, when expenses require cuts, these are made in accordance with the hierarchy outlined by Flexible-Firm and the first area in which staff will be reduced is the periphery – particularly outsourced groups – as these team members are not integral to the organisation and are usually contracted only to complete a specific task. Should further cuts be required, the next target will be other members of the periphery such as part-time staff and less experienced team members. ‘Zero hours’ contracts may be utilised so that wage cuts can be made whilst retaining individuals on a company contract for future times of need. This does, however, put pressure on remaining staff as they will have to pick up many tasks, therefore careful consideration should be had before too many cuts are made. Generally, the core group are safe in this model as they are considered vital to the organisation’s function. If cuts are required within the core group, then it may be indicative of major financial difficulty within the company.

Benefits

This model is particularly useful for those in higher managerial positions within an organisation, as it demonstrates the areas in which the company can be streamlined using proactive approaches. It allows the business to match the volume and skill-level of staff to their requirements at the time, which may in the long-term lead to lower wage and other staff-related costs, and may provide a competitive edge over market competitors.

Drawbacks and Arguments Against

However, this model carries a degree of risk due to its proactive nature – if predictions suggest the need for cuts and the company lays off staff needlessly, productivity may drop and the competitivity of the organisation may fall off as it struggles to keep up with its rivals, leading to further needs for cuts. Therefore, this model should be in place at all times theoretically but only physically implemented when necessary, due to its risky nature. In addition, this model is often considered unnecessarily objective and is seemingly unfair on low-skilled, “peripheral” employees, who are – unlike core employees – not exposed to training and will, therefore, remain within the periphery. Some instead argue that this is too simplistic a model, and core and peripheral status is flexible and changes in accordance with demands within the company. Furthermore, it is also suggested that employers often contract ‘peripheral’ workers to fill high-skilled, specialist gaps in the ‘core’ workforce.