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

Flexible-Firm Model

Origins

The Flexible-Firm Model was proposed in 1984 by John Atkinson of the Institute of Manpower Studies . He suggested that organisational structures require increased plasticity in a fluctuating market and unpredictable and competitive business environment. The answer to this market volatility was, in his view, the implementation of flexible staffing arrangements. Atkinson identified the need to distinguish the levels of importance of certain teams or groups of employees to an organisation, to generate workforce flexibility and a clear hierarchy of importance. This led to the formulation and creation of the Flexible Firm model as an answer to how such groups should be placed within the flexibility hierarchy.

The key belief of this model is that being proactive and decisive, rather than reactionary in terms of change is the difference between a successful flexible organisation and a dysfunctional organisation. The model suggests that the workforce can be proactively designed to meet businesses needs within a turbulent market. The model advocates the integration of flexible conditions within an organisation's functional operations so that it can meet the requirements of a competitive market resulting in the achievement of goals and aims. It does, however, note that creating a flexible workforce is a risk as cutting down the workforce may backfire in strenuous conditions if there is insufficient scope to deal with unforeseen issues.

Introduction

The Flexible Firm model divides an organisation's employees into two distinct groups, the core group and the peripheral group . The core group consists of full-time primary workers and internal workers who are integral to the functionality of the organisation, functionally-flexible and difficult to replace, due to high-level skills, knowledge and experience.

In contrast, the peripheral group consists of secondary workers, who are often less skilled and less experienced. The numbers of people in the peripheral group is highly variable, as their skills are easily available in the labour market. This means that they can be sourced at short-notice, in accordance with the number and type of particular tasks and are often only needed at particularly task-heavy periods of the week. The peripheral group can be divided into two sub-groups: the first peripheral group, consisting of the aforementioned low-skilled, often part-time and flexible workers, and the second peripheral group, which is made up of large volumes of agency staff, outsourcing and sub-contractors. These individuals, who often operate functions such as cleaning and catering – though they are not direct employees of the organisation – are important to its functioning.