Strategies to reach flexibility

1. Fragmentation? The future of work in Europe in a global economy Roma, 8 – 9 October 2008 Strategies to reach flexibility Key findings on employment relations and work organisation in work package 12.3 Ursula Holtgrewe | FORBA, Vienna

2. Organisation theory: dilemma of flexibility versus efficiency (Thompson 1967)‏Flexibility may be something companies want to get rid of! Increasing competition between segments (Rubery 2006)‏ Increasing contradictions between purposes and unintended outcomes Flexibility and restructuring: common assumptions and challenges • Flexibility as a general requirement on global, saturated ... markets • Outsourcing to increase numerical flexibility while retaining functional flexibility and commitment of core segment („flexible firm”, Atkinson 1984)‏ • Increasingly networked production to increase functional flexibility (Powell 1990)

3. Flexibility and restructuring: General findings • Restructuring of value chains does not always increase flexibility but may have other aims: • cost-cutting • Closeness to markets/customers • Access to knowledge • Requirements for flexibility may be passed on along the lines of power and position in the chain. • Intendedly or unintendedly, restructuring generates its own demands for flexibility.

4. Relocations and flexibility • Initially, mostly relocation of standardised and operative functions and processes: • Clothing: Taylorised production • Software: coding and testing • Spatial distance limits flexibility and responsiveness • Quality problems • communication • logistics

5. Flexible employment • Embedded with national labour market institutions (fx DK flexicurity, AT Freelance contracts)‏ - no overall patterns • Traditional, numerically flexible arrangements (= secondary labour markets)‏ • Seasonal work in food industry (segmented along ethnic lines)‏ • Clothing: Small businesses and informal sector in Italy • Initial fixed-term contracts in public sector

6. Flexible employment • New options • Public sector & services: outsourcing to escape secure and tenured employment • Meat Inc. DK: deboning relocated to East Germany, employment of fixed-term, temporary Polish migrants • Business-Software DE: implementation on customer sites left to consultancies and self-employed consultants = Proactively seeking access to new, lower-cost employee groups (where numerical flexibility comes cheaper)‏

7. Flexible work organisation • Expansion of value chains – multiplication of interfaces • Standardisation/Modularisation enabling further outsourcing • Emerging specialists for flexibility (in particular business functions)‏ • Call centres (numerically and functionally)‏ • Intermediaries in clothing or research (functional)‏ • New interfacing jobs and transactional labour • Intended and unintended externalisations to lower end of value chain

8. Flexible work organisation: standardisation • technological/hierarchical/contractual specification of products and services (fx service level agreements)‏ • (Remote) surveillance • Workflow systems across companies • Documentation • Often at odds with “real” work

9. Work complexity • Uneven picture (increase in Northern countries/NL, decrease UK, DE, IT, ES)‏ • Source: Greenan, Kalugina & Walkowiak, 2007: 33

10. Flexible work organisation: ad-hoc flexibility • Standardisation complemented/compensated by contextualisation and tacit knowledge (at both ends of value chain)‏: how to interpret an SLA or specification ... • Multiplication of perspectives • Research & marketing • Customer relationship, problem solving and contracts with clients • Interfaces up and down value chain • BUT Overall speed-up of work

11. Limitations to flexibility • Space • limited mobility of workers • Logistics of global relocation (nearshoring rather than global lowest cost)‏ • Time • Overall speed-up of work • Time to develop co-operation and trust • Standardisation  Contextualisation • Particular workers‘ bargaining power

12. Mapping restructuring and flexibility

13. References • Atkinson, J. (1984): 'Manpower strategies for flexible organisations', Personnel Management, vol. 16, n° 8, p. 28-31. • Flecker, J., Holtgrewe, U., Schönauer, A. & Gavroglou, S. P. (2008): 'Value chain restructuring and company strategies to reach flexibility. WORKS deliverable 12.3', Wien. • Greenan, N., Kalugina, E. & Walkowiak, E. (2007): 'The transformation of work? D9.2.2 of the WORKS project - Trends in work organisation', Centre d'Etudes de l'Emploi, Noisy-le-Grand. • Powell, W. W. (1990): 'Neither market nor hierarchy: Network forms of organization', in Staw, B. M. & Cummings, L. L. (eds.): Research in organizational behavior vol. 12, JAI Press, Greenwich CT, p. 295-336. • Rubery, J. (2005): 'Labor Markets and Flexibility', in Ackroyd, S. et al. (eds.): The Oxford Handbook of Work and Organization, Oxford UP, Oxford, p. 31-51. • Rubery, J. (2006): Segmentation theory thirty years on, European Work and Employment Research Centre, University of Manchester, Manchester, vxu.se/ehv/cafo/iwplms/papers/rubery_segmentation.doc. • Thompson, J. D. (1967): Organizations in Action, McGraw-Hill, New York et al.

14. Thank you!