The globalization of the temporary staffing industry - PowerPoint PPT Presentation


PPT – The globalization of the temporary staffing industry PowerPoint presentation | free to view - id: 22029b-ZDc1Z


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation

The globalization of the temporary staffing industry


Complexity and variability in firm strategies ... Societal embeddedness and home country effects (e.g. Jacoby, Doremus et al., Yeung etc. ... – PowerPoint PPT presentation

Number of Views:58
Avg rating:3.0/5.0
Slides: 29
Provided by: vhe68


Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: The globalization of the temporary staffing industry

The globalization of the temporary staffing
Neil M. Coe School of Environment and
Development The University of Manchester, U.K.
  • Seminar to the Department of Public
  • Korea University, 3rd February 2009

  • Introduction the industry and the wider project
  • Theorising the embedded transnational
  • Territorial embeddedness and the multinational
    model in temporary staffing
  • Complexity and variability in firm strategies
  • Transnational agencies and the production of
    national staffing markets
  • Conclusions

Geographies of Temporary Staffing Unit (GOTSU)
  • Five researchers, four themes
  • The globalization of temporary staffing
  • National varieties of temporary staffing markets
  • Temporary staffing agencies as mediators of
  • Profiling the UK temporary staffing market
  • New website
  • http//

Why temporary staffing?
  • Large, fast growing, under-researched industry
    exhibiting strong internationalisation dynamics
  • Complex and spatially variable expansion
  • Example of a particular kind of service sector
  • Economy-wide implications, as vectors of a
    particular kind of labour market flexibility…
  • Active agents of labour market change and
    processes of neoliberalization…

Researching the Globalization of Temporary
  • Two year academic project (Sept. 2004 to Nov.
    2006) funded by the ESRC
  • Research methodology
  • The horizontal dimension identifying and
    mapping the global temporary staffing industry
    (top 20 transnationals)
  • The vertical dimension embedding the global
    temporary staffing industry (Sweden, Australia,
    Japan and Eastern Europe)
  • Semi-structured interviews conducted
  • 25 interviews with 14 of the top 20 firms
    (including all top 8) at headquarter level and
    more since…
  • 59 case study country interviews with
    transnational firms, domestic agencies,
    government, labour unions and trade bodies

Top 20 Transnational Agencies, 2007
Global presence of the top 20 in 2005
The TNC as a network form
  • Dicken (1994 106) …TNCs as highly embedded
    interacting networks involved in competitive
    struggles in which a diversity of competitive
    strategies is used. Such strategies are,
    themselves, the outcome of contested power
    relations both inside the firm and, externally,
    with the constellation of institutions (including
    the state) with which TNCs interact.
  • More broadly our approach is informed by a Global
    Production Networks (GPN) perspective that
    explores the power, value and embeddedness
    characteristics of transnational economic systems

The embedded firm, version 1
  • Subsidiary embeddedness in host contexts (e.g.
    the Scandinavian school, Birkinshaw, economic
  • Focuses on depth and quality of relations
    between inward investors and local
  • The quality FDI debate enclaves and/or
    upgrading potential
  • Corporate HQs and the limits to subsidiary
  • Weaknesses tends to focus on inter-firm
    relations, and sees inward investors as driver of
    firm-territory interface

The embedded firm, version 2
  • Societal embeddedness and home country effects
    (e.g. Jacoby, Doremus et al., Yeung etc.)
  • Organisational forms and practices shaped by
    regulatory environment of home country
  • Distinct national paths of internationalization
  • Transfers of industrial models and processes of
  • Weaknesses prioritises home country
    institutional effects, and national over sectoral

The embedded firm, version 3
  • Market-seeking FDI in service sectors
  • Nature of host market (e.g. regulatory
    conditions, local competitors etc.) drives
    internationalisation strategies and shapes nature
    of territorial embeddedness
  • 1. need to look at the far side of
    international business (Hansen, 2008)
  • 2. need to look at internationalisation as a
    relational rather than atomistic process
    (Glückler, 2006)
  • 3. complexity and variability of
    internationalisation strategies and processes
    (Faulconbridge et al., 2008)

The general model the multinational corporation
  • In general terms, temporary staffing firms are a
    relatively simple form of transnational
    corporation conforming to the notion of a
    multinational organizational model
  • Most key assets, responsibilities and decisions
    are decentralised and HQ-subsidiary relationships
    are concerned primarily with financial control
    and reporting
  • Transnational agencies tend to run as
    decentralised federations management hierarchies
    tend to be fairly flat, and HQ operations
    relatively small, with marketing, IT and HR the
    key functions organised at a global scale

Temporary staffing as highly territorially
  • Shaped both by the inherent nature of the
    business, and its geographically variable
  • Extensive office networks (especially general
  • Candidate lists and local labour markets
  • National patterns of labour market regulation and
    welfare provision
  • National patterns of staffing industry regulation
  • Strength and nature of local competition
  • Strength and nature of local lobbying/resistance

Global contracts mixed messages?
  • Yes we do operate global contracts and theyre
    always a challenge…what you need to manage is
    that you have different legal frameworks,
    different cultures... and different cost
    structures … so with the global agreement weve
    always got to be very careful in terms of
    delivering the service, theres no compromise…
  • Definitely it is growing global contract
    business in some countries you would find that
    the global agreements would account for more than
    60 of their business, so its quite a growth area
    and what were striving for is not to lose the
    focus on ad hoc business where invariably the
    margins are higher because ad hoc is when
    somebody needs something urgently and then they
    will pay a premium for that, whereas the global
    agreement could be over three years…
  • If youve got different employment laws in
    different countries I dont see how it global
    contracting works in practice

Technological change slow to react?
  • I think its something that were going have to
    sort of look at quite seriously. Our business has
    a lot to do with social trends … as people become
    more familiar with doing stuff online, with
    having remote transactions, I think it will force
    this industry to…there will be offices, but I
    think it will be different… You can start to see
    that happening increasingly candidates are able
    to pre-screening for jobs online and stuff, so
    the productivity in the branches goes up because
    weve got pre-screened candidates coming along,
    so its beginning to change
  • If youd come into this industry 25 years ago
    and were looking at it today and trying to spot
    the difference I think youd actually find it
    quite difficult. I think you would find that
    there is more use of technology, though I dont
    think thats as widespread as it potentially
    could be and I think as an industry as a whole it
    probably hasnt changed as much as the market
    around us has changed - so what you start to seen
    now is the emergence of different types of
    competitors and you find an industry thats not
    actually sure of what to do about it

International placements a missed opportunity?
  • Yes, Slovaks are willing to move, so that is
    what we are now planning and looking into
    bringing Slovak people into the Czech Republic,
    even temps. That is only just starting. Other
    companies have been doing that for some time
    already. Slovaks are willing to come here, as
    are some Polish people near the borders
  • Cross-border work always interferes with the
    local market and there is always a dilemma….we
    saw it in the past with other countries…a dilemma
    between doing the cross-border which means you
    lose on the internal business because there is a
    risk of cannibalism as they call it. But if we
    dont take it, the competition will
  • Issues regulatory/cultural barriers,
    transferability of qualifications, variability by

Strategy dimension 1 scope
Variations in office networks
Strategy dimension 2 FDI policy
  • Different modes of market entry and subsequent
    growth greenfield/organic, acquisition,
    franchise (e.g. CDI) and Internet-based (e.g.
  • Shaped by both complex intersection of firm
    strategy and host market conditions
  • Highly variable in both space and time (e.g.
    timing of entry relative to competitors)
  • In some markets, firms are driving development
    of the industry (e.g. Eastern Europe)
  • In others, same firms are responding to local
    regulatory, institutional and competitive
    conditions (e.g. Japan, Australia)

Strategy dimension 3 varying degrees of central
  • Federal…
  • Our decentralised management structure is
    designed to enhance communication and minimise
    corporate overheads. Local management retains a
    high degree of autonomy in the day-to-day running
    of their business including hiring, prices,
    training and sales and marketing. This enables
    them to respond quickly to market changes. The
    organisational structure stimulates an
    entrepreneurial working environment
  • … vs more centralised models
  • Its strategy at the top, execution driven down
    and localized strategy, localize as it goes down.
    And when you have global customers, were
    different. We have to be different than other
    companies because we have 100 client companies
    and we do 70 of our business with them, and they
    demand a consistency across our enterprise...

Dynamic not static terms…
  • Increased centralisation, e.g. Adecco 2005-06
  • All businesses under one name and moved to six
    global professional business lines (e.g. human
    resource solutions, finance and legal) and four
    global functions (e.g. finance, HR)
  • Increased decentralisation, e.g. Kelly Services
  • Implemented a new business structure designed
    around three regions the Americas, Asia-Pacific,
    and EMEA. Business leadership, sales, and
    marketing teams realigned to support this new
    structure and accelerate worldwide expansion.

Strategy dimension 4 varying degrees of
  • Particularly in terms of branding and
    sales/marketing strategies
  • We have an advantage, or disadvantage, our size
    disadvantage is actually an advantage because I
    can still execute a global sales strategy in a
    very orchestrated manner, whereas my bigger
    competitors struggle with that …we are now being
    frequently told that we appear far more global
    than some of our much bigger competitors
  • The brand needs to be flexible enough so that it
    can be relevant locally and needs to be able to
    reflect whats important in the cultures of the
    local market. But you need to have some
    linkage…a global brand

Modes of national staffing regulation
  • Mode 1 liberal industry regulation, liberal
    labour market regulation (e.g. Ireland, UK, US)
  • Mode 2 liberal industry regulation, lightly
    regulated labour market (e.g. Australia, Czech
    Republic, Poland)
  • Mode 3 liberal industry regulation, highly
    regulated labour market (e.g. Germany, Japan,
  • Mode 4 strict industry regulation, lightly
    regulated labour market (e.g. Belgium, Italy)
  • Mode 5 strict industry regulation, strict labour
    market regulation (e.g. France)

Producing national temporary staffing markets
Key parameters of five national markets
(No Transcript)
Modes of transnational activity in making of
  • Different types of transnational presence in
    different national markets
  • Market-making involved in the opening up,
    creation and institutionalising of national
    staffing market
  • Market-mediating involved with other labour
    market institutions in the expansion of market
    size and scope
  • Market-responsive range of domestic labour
    market institutions lead on the creation of the
    market, with transnationals responding to
  • Transnational agencies role in market
    construction is variable same firm can lead in
    one market, respond in another

  • TNCs as the nodal points of and interface
    between two realms that of internationalization
    in global structures, and that of embeddedness in
    the domestic structures of national/regional
    political economies (Sally, 1994 162)
  • Extending notions of the embedded
    transnational to look at market-seeking FDI
    heavily shaped by host market extra-firm
    connections range of labour market institutions
  • National staffing markets made through the
    interaction of a range of actors and institutions
  • In different national staffing markets
    transnational temporary staffing agencies play
    different roles