Looking to improve operating margins in your business? Then take a look at your staffing strategy.

From the assembly line to the executive office, effective staffing is essential to maximizing profitability.

Below is the first of a three-part installment of our 10 practical strategies for using staffing to reduce overhead, manage operating costs, and improve organizational performance.

1. Convert Fixed Cost to Variable

If your company is like most, labor is the biggest line item on your P&L. To minimize that expense, implement a planned staffing model. Reduce core staff to levels necessary to maintain normal operations. Then partner with qualified temporary staffing vendors to supplement your staff with trained temporary personnel to meet peak production demands as needed. This strategy is particularly effective for industrial labor, as well as for technical and professional projects.

2. Eliminate Overtime

Overtime is an extremely expensive way to get work done. Using temporary employees in place of overtime can reduce labor costs by 20% or more.

3. Limit Benefits Expense

On average, benefits cost 20% - 25% in excess of payroll expenses. Where appropriate, use temporary and payrolled employees (employees who are paid through a staffing firm or professional employment service) to eliminate benefit expenses. This option is most often used for interns, project professionals, and other short-term employees. Using temporary and payrolled employees in place of independent contractors will also reduce your employment risks.