Human Resource Practices in Multinational Companies in Ireland: A Large Scale Survey Paddy Gunnigle, Jonathan Lavelle & Anthony McDonnell

Transcription

1 Human Resource Practices in Multinational Companies in Ireland: A Large Scale Survey Paddy Gunnigle, Jonathan Lavelle & Anthony McDonnell LRC Symposium Croke Park, June 19 th 2008

2 MNCs Matter. Scale Drivers of globalisation.particularly in Ireland Industrialisation by Invitation Key role in economic growth (esp. US FDI) 2006: stock of American FDI of 52.5 billion - more than BRIC combined ( 46.5 billion ) Recent years shift to services (esp. financial services) & Outward FDI growth (exceeds inflows) 2

3 3 Why survey MNCs in Ireland? Iralco & Tesco: a microcosm of the changing face of MNC activity in Ireland? Previous research unrepresentative - large and famous - Incomplete or inaccurate listings - Exclusion of home-owned MNCs 1 st large-scale representative survey of HR in MNCs Definition of an MNC - Foreign-owned: 500+ w/w and at least 100 in Ireland - Irish: 500+ employees w/w and at least 100 outside Ireland Response rate - 63% Catches hitherto excluded categories Irish MNCs Non-aided MNCs (esp in retail & hospitality)

4 4 Profile of MNCs in Ireland Origin: US 40%, Cont.Eur 24%, Ire 18%, UK 13%, RoW 5% Size ww: 42% Foreign 30,000 ww; Irish 32% 5,000ww Size Irl: - Foreign: just 2% 5,000+, 23% 1,000 - whereas Irish: 57% 1,000 Sector: Services = 51%; Manuf. = 39%; Multi-sector = 10% Foreign MNCs - Most of recent vintage & via greenfield site - Most multi-site - High Job Churn

5 Profile, contd Irish MNCs - new to international stage, greenfield significant - But reasonable geograpical spread - & High job churn Overall - Low temporary & part time working - Position in value chain: most view as important Satisfaction with Irish labour force Factors impacting on new investment decisions 5

6 Satisfaction with Irish Labour Force 100% 80% 60% 40% 20% Very good Good Fair Poor Very poor 0% Availability of university graduates Quality of university graduates in employment Quality of technical graduates in employment Workforce ability to learn new skills Work ethic 6

7 Factors influencing decisions on new investments Ranking (1=most important; 7=least important) Labour availability Labour costs Industrial relations climate General infrastructure Overall operating costs Capacity of operations to innovate Financial incentives 0% 20% 40% 60% 80% 100% % of MNCs 7

8 Focus of Study Four areas of employment practice: pay & performance management training, development, & org. learning employee involvement and communication employee collective representation and consultation; 8 & Three distinct staff groupings managers the largest occupational group (LOG) the key group i.e. a group that the MNC defines as key to competitive advantage [excluding managers]

9 Pay Policy in MNCs 70% 60% 50% 40% 30% LOG Key Group Managers 20% 10% 0% Below median Midpoint 2nd quartile Top quartile 9

10 Variable/PRP in MNCs 100% 90% 80% 70% 60% 50% 40% LOG Key group Managers 30% 20% 10% 10 0% UK US Europe Rest Irish

11 Performance Appraisal in MNCs 100% 90% 80% 70% 60% 50% 40% Foreign Irish 30% 20% 10% 0% LOG Managers Single schemes Different schemes 11

12 Performance Appraisal by country of origin 100% 90% 80% 70% 60% 50% 40% Largest group Managers Single schemes Different schemes 30% 20% 10% 12 0% UK US Europe Rest Irish

13 Performance Appraisal Methods 60% 50% 40% 30% Foreign Irish 20% 10% 0% Forced dist. Peer/360 degree Forced dist. Peer/360 degree LOG Managers 13

14 Training & Development: MNCs = big spenders? Majority spend 1%-4% of annual pay bill on T& D US MNCs highest spenders, then UK & European but differences not substantial 66% have succession planning mostly global in orientation 50%+ have formal management development programme often global in reach. US firms most likely to use all T&D interventions 57% of firms with key group have specific development programme for this group 14

15 The HR Function 54% have HRIS 39% have HR shared service centres highest utilisation in Irish MNCs. 59% have HR policy formation body higher in foreign owned, particularly US. High levels of international networking between HR managers involving a wide range of mechanisms High level of monitoring by senior international management (headcount, labour costs, pay)..michael to cover 15

16 16 Union recognition in MNCs 61% of all MNCs engage with a trade union 17% recognise union(s) at some sites 29% at all sites 15% at single sites High in comparison with previous studies Possible explanations? Size of the MNCs Wider coverage indigenous MNCs, more UK, More non-aided (Retail & Leisure) Organisational level study (no double counting) Clear country of origin effect - 8 in 10 UK & Irish, 7 in 10 Eur MNCs recognise TUs - 4 in 10 US MNCs

17 Trade union recognition by ownership 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Yes No UK USA Rest of Europe Ireland Rest of World Total Foreign Irish 17

18 Union recognition in new sites Four in ten (42%) unionised firms recognise TU s in all new sites. A third (33%) in some sites. A quarter did not recognise TUs at any new site(s). 6 in 10 unionised MNCs establishing some new sites on a non-union basis double-breasting Strong country of origin effect American US MNCs to the fore 18

19 Non-union structures A third of all MNCs have non-union representative structures. US MNCs the most likely 60% established within the last 3 years. Possible stimuli Information and Consultation Directive? Staving off union recognition using Right to Bargain legislation (RyanAir Case) 19

20 Union recognition in new sites by ownership Total Rest of World Ireland Rest of Europe USA Yes at each new site Yes at some or most new sites No at new sites UK 0% 20% 40% 60% 80% 100% 20