Organisational Flexibility | Literature Review

Organisational Flexibility Literature brushupThis chapter reviews the literature on organisational tractability, the several(predicate) types that exists, and the distinguishable forms commonly seen in contrary organisations. The different forms of tractability be discussed in role 2.2.3 using the categorization provided by Looise et al (1998) Major studies reviewed, particularly the fashion of Atkinson (1984) foc mapd on the fact that on that point be 2 main sepa posts of turn tailers inside a smashed the totality assort and the marginal root word. The theory of the compromising substantial make by Atkinson is at the centre of this literature review. It is discussed in section 2.2.4 followed by just about empirical evidence of the lend oneself of tractableness in section 2.3TheoryAn overview of the different types and known forms of tractableness used in organisations is discussed in this section. After that, an illustration of Atkinson model of the conci liative riotous is to a fault provided in section 2.2.4Definition of tractablenessAs defined by Looise et al, 1998 and Blyton and Morris, 1989, flexibility is the ability to adjust under fluctuating and un trusted circumstances. The innovation of the flexible firm itself was originated by Atkinson in 1984 where he argues that at that place is a growing tr revoke for firms to seek various forms of structural and operational flexibility. Searches he make at that cartridge holder demonstrate that flexible mesh keep provide an elastic and less(prenominal) rigid approach at bottom close functions in an brass, finished the use of strategies such as flexitime running(a), flexible work rotations, multi-tasking, production flexibility and delivery flexibility. Flexibility strategies croup also make better a companys competitive position on the basis that the meaning of flexibility is the ability to respond to changing market circumstances usefully.Types of flexibility gib e to Atkinson (1984), there ar one-third main types of flexibility areas and they are as followsFunctionalNumericalFinancialFunctional flexibilityIt is the ability of managers to eliminate the range of tasks a worker can perform. With usable flexibility, employees are give tongue to to be multi-tasking or multi- technical. They are able to perform different tasks and functions inside the kindred company as required by the management. It requires a rise proficient work forcefulness with in-depth knowledge of the different areas of the company, its processes, and its prevailing culture. This practice is say to benefit two(prenominal) the employees in full terms of contrast enhancement and the organization which avails a multi-skilled workforce at its disposition and ready to face quick changes. An example in the hotel sector, a receptionist can check in/ bring out guests in the morning and also cleans guests rooms as a chambermaid after the morning rush. This demonstra tes the extent to which companies are given greater flexibility to act rapidly and smoothly as a means of reacting to the difficulty of module shortage. tally to Atkinson (1985), functional flexibility may imply the same labour force changing its activities within the organization in both short term and medium term.Numerical flexibilityNumerical flexibility can be defined as the ability of organizations to increase or decrease job quickly in declension with fluctuations in chore demand, and to improve competitiveness of firms through adopting this flexible policy (Atkinson1984 Looise et al 1998 Ruiz-Mercarder et al 2001). With numeral flexibility, companies can easily increase or decrease its make out minute of workers in the short term to accurately achieve an comminuted coincidence between the needed workforce and that effectively employed. It is commonly achieved through the use of different types of contracts and variations in the distri besidesion of working time. W hen organizations use numeral flexibility policies, they tend to predict the requirements for kind re ejaculates and then adjust their human re rise supply agreely. For this type of policy to be more than effective and in order to achieve greater success in equilibrise demand and supply, organizations must imperatively have the ability to use employment and deployment. For example, in most hotels nowadays, the accounting and finance department tries to predict the number of tourist arrivals during different closures by using bud initiateing systems and then pass it on to the Human Resources department which decides whether there is a need to employ more workers on contract in order to meet the budgeted demand.Financial flexibilityIt is defined as the policy of adjusting employment costs in line with the demand for labour in the organization, and reflecting the supply of labour in the outside(a) labour market. It is t wherefore obvious that financial flexibility and mathemat ical flexibility are closely associated which implies that genuine forms of numeric flexibility inevitably hap to greater financial flexibility for the employer. More specifically, in terms of stage setting wage levels, financial flexibility means moving from uniform and standardized pay structures towards individualized pay systems. Financial flexibility usually involves a sort of performance ground element of pay or just now based on merits.Sources of labourBetween these three broad types of flexibility, that is functional, numerical and financial, Looise et al (1998) further classify flexibility strategies into a two-by-two matrix based on two considerations, the source of the staff (that is the acquisition of man top executive internally and orthogonally) and the involvement of different skills (that is the requirement for staff to have ace specific skill only or be able to work more than two positions). This two-by-two matrix is illustrated below.Table I Labour flexibi lity matrix subjectiveExternalOvertimeAgency staff valuedVariable working timeshort-term contractsPart-TimeFlexible contracts transform workingExchange of labourLabour poolQualitative short letter whirlingDetachmentMulti-taskingConsultancyMulti-functioningSource Looise et al (1998)Internal decimal source of labourInternal quantitative source of labour implies numerical flexibility. It represents the different ways a company can obtain a numerical increase in its labour force by feel within the organisation itself.(a) OvertimeFrom Table I overtime is said to be an internal quantitative source of staff. Overtime is the term used to place work undertaken on top of an employees usual contracted hours. Employees are normally paid at an enhanced rate for their overtime (usually one and a half time the normal hourly rate or still double time). Overtime is usually done voluntarily by employees as it is seen as a means of supplementing their basic wage. However, in some circumstances, it is compulsory. For many a(prenominal) workers, particularly in white collar jobs and especially amongst professionals and managerial grades, there is no additional overtime payment, even working after normal contracted working hours.(b) Variable working timeIt refers to a blank space where the employee is free to remove his or her working time. Usually, employers accept to make workers choose between variable working time as commodious as they attain a certain quota in their work as targeted by the management.(c) Part-timeIt denotes jobs where the number of hours is less than the standard working week. However, there is a problem when talking about part-time jobs. There is no global agreement on what constitutes a standard working week, although there are sometimes industry or establishment norms. It implies that the term part-time can be used to denote psyche working a three hour week as well as someone working thirty hours a week.(d) Shift workingShift working is an oppo site(prenominal) internal source of quantifying labour. It allows establishments to work continuously by deploying a commodious workforce across three segments in the working day advance(prenominal) shift, late shift and night shift. In many instances, employees go forth turf out across these shifts from week to week.Internal qualitative source of labourInternal qualitative source of labour is more likely to be coupled with functional flexibility. It encloses the different ways a firm can get working within the company itself to do different tasks.(a) Job RotationJob rotation means that employees within a particular work area have the ability to perform a variety of tasks and impart move from one to other at various times within the working day or the working week. This means that employees have to be fully flexible and able to perform different tasks when necessary during the working day.(b) Multi-tasking and multi-functioningMulti-tasking or multi-functioning implies that a worker can do other jobs asunder from those assigned to him. For example, in the hotel sector, a soul can work as barman and prepare cocktails and also work as cook in the kitchen.External quantitative source of labourExternal quantitative source of labour refers to the different ways a firm can establish numerically flexible and get an increase in labour force by looking for workers outside the firm.(a) Agency staffStaffing agencies co-ordinate and ask with corporations, organizations and other clients, size up theirhumanresourcesneeds and match their staff needs according to specific requirement. This implies that agency staffs are those persons who are registered to a staffing agency which in turn try to place them in certain specific jobs according to their qualifications. For example, if a hotel is looking for a cook with 2 years experience, it may contact the staffing agency which will look in its data base system for a cook with the experience necessary.(b) Short-term c ontractsShort-term contract jobs are jobs that have a definite end date. The length of the contract is specified in the contract itself. Short-term or contract jobs could last for one month, three months or even cardinal months, depending on the nature of the job. Some people choose short-term jobs because they dont unavoidableness to feel like they will be stuck in the same job for a long time.(c) Flexible contractsFlexible contract is another quantitative source of labour. It implies employing persons through agency staffs, employing freelance workers or casual workers or even outsourcing the work to specific agencies in the particular field of work required. An example in the hotel sector, instead of employing someone permanently to do agriculture or cleaning, there is a gardening agency that provides workers for a certain time period. These workers would be paid directly by the hotel itself but will leave when the job is over.(d) Exchange of labourExchange of labour is a syst em where an organization does not need to any recruitment and pickaxe to obtain the necessary labour. Instead it looks within other companies most of the time within the same group of companies and take the best candidate according to requirements. In the hotel sector for example, lets say La Pirogue Hotel need a chef cook. Instead of recruiting one, the hotel will try to find one within the other hotels in the group, i.e. the Sun Resorts Ltd.(e) Labour poolLabour pool refers to a source of trained people from which labour can be hired. It is another extraneous quantitative source of labour where companies can find trained people required for a particular job. The University Of Mauritius is a labour pool. When, for example, a finance company needs ten persons to work in a particular department, they may come to the University of Mauritius and choose the ten best finance students that fits their requirements.External qualitative source of labourIt implies functional flexibility but the source of labour this time is outside the firm.(a) DetachmentProfessional drug withdrawal is about doing a task when you dont like it very professionally.If a person is affected by the way the customers talk and that affects the way he or she is doing the job, then the last mentioned are not professional in his work.Professionalism is manifested when someone carry out the job when he does not like it at all. Professional detachment paves the way for achieving excellence and avoiding a lot of superfluous headaches that one will get from personal involvement.(b) ConsultancyConsultancy is an arrangement where a medical specialist firm sells its services to other firms. For example, KPMG offer advice about matters like receipts or investment or management to other firms. Consultancy is therefore an external qualitative source of labour as the consulting firm will tear workers to the other company and provide advice which may benefit the company in terms of better quality work. John Atkinson model of the flexible firmIn the 1980s, debates around flexibility were center on the model of the flexible firm proposed by Atkinson (1985). The most distinctive feature of Atkinsons model was the mesmerism that firms started dividing their workforce into CORE and PERIPHERY workers. The model is illustrated in the figure below. finger 1 The flexible firmSource Atkinson (1985)The core groupAccording to Atkinson, the most eventful part for a flexible firm is its core group. Core workers are full time, i.e. permanent employees who benefit of job shelter and high earnings. In return, they perform different tasks and work as flexible workers across different traditional skills boundaries. They are functionally flexible. The firm invests in these workers in terms of training and they develop new skills which make it feasible for them to perform different tasks. Typical members of the core group include managerial and professional staffs and multi-skilled workers.The fir st peripheral groupOutside the core group there is a great variety of peripheral workers. However, the first peripheral group is composed of full-time workers. As compared to the core group, these workers enjoy less job protective covering and inferior career prospects. They are hired to do specific jobs usually of semi-skilled nature. Because workers within the first peripheral group are easily recruited and easily fired, firms can vary their number according to different levels of activity and hence become numerically flexible. In the hotel sector, a emblematic example could be a waiter or waitress. When there is too much work, more waiters are recruited and when the load of work goes down, again some are fired.The second peripheral groupThe second peripheral group is made of part-timers, people on job share, and a variety of improvised workers such as workers from agency staffs, people on short term contracts and also those on government schemes. These workers perform the same type of jobs as the first peripheral group and also give the firm numerical flexibility depending on fluctuating activities and hence allow to fight with diffident growth. The only difference between these two groups is that the second peripheral group is made of part time workers whereas in the first peripheral group, workers are on a full time basis.Outside the firm(Self-employment/ sub-contracting/ increase outsourcing/ agency temporaries)There is a variety of external workers outside the firm who perform either routine tasks such as cleaning and security or very specialized ones. For example many firms employ external workers to do cleaning jobs or ensure the security. There are also sub contracts, agency staffs and home-workers. Home workers may be those working in areas of computing or networking and who can work also through long distances. With these external workers, firms are able to cope with predictable changes in their activities and therefore become financially flex ible rather than numerically flexible as they enable the firm to limit financial commitment.Empirical evidenceIn this section, different studies pertaining to flexibility are illustrated. Some figures are provided to demonstrate the use of different forms of flexibility in organisations.The evidence for flexibilityWhen Atkinson make the see, be based his model on evidence from sheath studies and surveys including the NEDC (1985) survey of 72 firms in the food and drink, engineering, retail and financial services industries. The NEDC, National commandment Data Center, is a U.S agency responsible for providing policy-relevant analysis and reports derived from education data and indicators. It was created in the 1980s by combining offices from several federal agencies. The surveys and case studies identified widespread increases in numerical flexibility in the too soon 1980s.Surveys also included the Advisory, Conciliation and Arbitration Service survey the ACAS (1988). The latter demonstrated that there was also a slight increase in different forms of numerical flexibility. For example, it argues that sub-contracting was the most common and has change magnitude in the manufacturing sector, in larger organisations and in parts of the public sector, such as health and civil service whereas job sharing was on an increasing apparent motion in sectors such as banking where there are problems of balancing staffing and workload.Studies made also provide the evidence that the number of flexible employees increased. They were divided into two particular groups part-time employees and self employed. In 1981 there were over 4 million people working part-time and in 1993, the number of part-time workers has tight reached 6 million. The studies demonstrate that the increase in part-time workers occurred at the expense of full-time workers. In 1993 when the number of part-timers increased by 227,820 to a total of 5,998,112, full-time jobs declined by 275,464 to a tota l of 14,889,977. Over the period 1981-1993, the number of part-timers rose by 1.25 million while full-time jobs declined by 0.5 million.The proportion self employed in the U.K workforce also increased substantially throughout the 1980s at a faster rate than the increase in part-time employees. In the 1990s there were nearly 3.4 million self-employed, approximately 1/8 of the total workforce.Hunter and MacInnes (1991) studyHunter and MacInnes made a study in 1991 on a survey carried out by the Employers Labour Usage Strategies (ELUS). The results progressively focused on workplaces having the most marked tendency to employ peripheral workers. ELUS visited 877 workplaces which made use of peripheral workers of various kinds. Hunter and MacInnes then took a sub-sample of 39 of these establishments. They identified three groups of workersFirst there was a set of skilled professionals and technical occupations comprising large numbers of freelance, agency staffs and self-employed workers .Second there was a group of manual and non manual workers who were seen by their employers as having a low level skill or as easily transferable. not much learning and training were required to do their jobs. Some were on a temporary or a part-time basisFinally, there was a smaller group between the two others which covered both skilled and unskilled jobs that were dependent in some way on limited contracts.The conclusion made by Hunter and MacInnes was that employees have started extending their use of non-standard contracts and this demonstrate the progression of different forms of flexibility in organisations.ConclusionResearches on flexible work are relatively well established and at least since the work of Atkinson (1984) there has been much attention to the concept of flexibility in organisations. Flexibility is seen as a means to improve a firms competitiveness by lowering labour costs. The 2 most important types of flexibility that will be considered within the rest of the project are numerical flexibility and functional flexibility. These two concepts are very important as numerical flexibility tries to make the firm able to cope with increases in work by changing the amount of labour quickly in response to changes in the market and on the other side, functional flexibility make it possible for employees to carry on different tasks and hence reducing company labour costs. Evidences in Europe proved that many companies are more flexible since the 1990s and are actually looking for more and more better ways to be flexible and businesslike both in terms of costs and productivity.