What Is a Flexible Firm?

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  • Written By: K.C. Bruning
  • Edited By: John Allen
  • Last Modified Date: 22 February 2020
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The flexible firm model is an arrangement in which a company offers its employees flexible work schedules. This tactic is meant to improve elements such as retention, employee satisfaction, and overall quality of work. It tends to be focused on employees with specialized skill sets who are difficult to replace. The concept was introduced by John Atkinson of the Institute of Manpower Studies in the mid 1980s.

Flexible firm companies emphasize both flexibility in work and in employment structure. In work, flexibility refers to the way completing tasks is approached by the company, be it by worker scheduling, the construction of work teams, and overall organization of work load. Employee flexibility concerns peripheral employees that may not always be needed to help the company run.

Employees in flexible firm companies are divided into two groups: core and peripheral or secondary. The core group is made up of workers who are essential to the success of the company and are needed year-round. Peripheral employees may be seasonal, part-time, or temporary. They are often contractors who are hired to work in a particular area or for a specific project.

The flexible firm model is typically a collaboration between the human resources department and company executives. In order for the system to work, these two groups will usually need a well-planned operational strategy. It is also important that they communicate well, as changes in the market, industry, or company can have a significant effect on staffing with this kind of model.


As a result of adopting the flexible firm model, a company can improve its output in several ways. One aspect is that giving employees more freedom tends to make them happier, which helps them to be more engaged in their work. This can lead to greater retention, which means that the quality of work is not only likely to improve, but also stay consistent as there will be less need to train replacement staff.

Another common benefit of flexible firms is savings in a variety of areas. With fewer full-time employees, common expenses such as office space, supplies, and benefits tend to cost less. A company with a thriving flexible firm model will also typically save money on recruiting, hiring, and managing employees. In essence, employees who enjoy a higher quality of life with a flexible schedule are less likely to cause discord or leave the company.


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