PurposeOwing to business uncertainty, it is prudent for organizations to rely on temporary employees to achieve numerical flexibility. This paper investigates the effect of perceived investment in temporary employee development (PITED) on organizational performance (OP) through the mediation process of organizational identification (OI), work engagement (WE) and the moderation process of perceived human resource policies (PHRP). A conceptual framework was built on social exchange theory and job demands-resource theory.Design/methodology/approachData was collected from skilled temporary employees deputed at client organizations in the information technology business process management (IT-BPM) industry. Analysis was done using the partial least squares-structural equation modelling (PLS-SEM) method using SmartPLS 3.0 software.FindingsThe study established a significant association between PITED, OI and OP, in which OI acts as a partial mediator. In contrast, the mediating relationship of WE between PITED and OP was insignificant. PHRP moderated the relationship between PITED and OP.Practical implicationsThis research suggests to top management and human resource leaders that PITED makes temporary employees identify with client organizations, resulting in increased OP.Originality/valueThis research builds on theoretical assumptions to adopt a temporary employee perspective on organizational initiatives and performance in the IT-BPM industry, which is uncommon.