Staffing and Organisation Performance – Supports for a Slight Overstaffing Level

The present paper presents a theoretical approach to measure the relationship between staffing levels and organisation performance. Results from the approach are used to find the optimum staffing level that maximises the profit of the firm. This study assumes that incoming work to a firm follows a random walk model, while the staffing level is managed by the firm in order to maximise the profit. The model includes effects of variability of external demand to the firm’s profit such as overtime work, late penalties, hiring and firing costs, and so on. The model was implemented using MATLAB and used to compute the profit for different staffing levels. Results from the present study indicate that a firm should be slightly overstaffed to maximise its profit. However, this may be related to the particular parameters used in the investigation