Knowledge@Wharton (02/01/12)

In a recent paper published in Organizational Dynamics, Wharton professor Peter Cappelli says corporate managers often do not sufficiently consider risks when hiring temporary or contract workers, generally focusing on operational costs instead. A January 2012 survey by ASA and ASA corporate partner CareerBuilder predicts an increase in U.S. companies hiring temporary or contract workers to 36% this year from 34% in 2011.

Cappelli says managers should take a systemic approach to risk management when making decisions about outsourcing, and rather than focus on reducing costs, they should concentrate on reliability and responsiveness.