The European Monitoring Centre on Change

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The European Monitoring Centre on Change
A pro-active approach to Industrial Change
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EMCC origins a little history

• Renault Vilvoorde closure 1997
• Gyllenhammar Report 1998 calls for creation of
  European Observatory on Industrial Change
• Nice Council 2000 agrees on EF in Dublin
• 23 October 2001 EMCC is launched
• Economic
• Social
• Technological
• Financial
• Territorial

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The European Monitoring Centre on Change is
designed to support the understanding,
anticipation and management of change
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What is the extent of corporate restructuring in
the EU?Jan 2002 May 2005
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Top five sectors affected by restructuring
activity Jan 2002 May 2005
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ERM Quarterly Spring 2005
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Top five sectors affected by restructuring
activity ERM Quarterly Spring 2005
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Announced job reductions due to restructuring
(per 10,000 people employed) during the 1st
quarter
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• Competition
• - National /International
• - Price Product
• - Labour costs

• Consumer expectations
• - Public pressures
• - Demand
• - New markets

Management Innovation - Need to reinvent
oneself - Organisational change - Business
strategy
Technical change - End of product cycle -
Technological developments
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Bankruptcy Closure
Mergers Acquisitions
Internal restructuring
Delocalisation
Outsourcing /Offshoring
Business Expansion Growth
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• Oxford English Dictionary Definition
• Restructure (verb) to organise a company,
  business or system in a way to make it operate
  more effectively
• Restructure (noun) the company underwent
  restructuring and 1500 workers lost their jobs

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Microwave Systems AB

• 1974 MBL Law
• sets up LIFO principle but also joint funds
• Early 90s deregulation
• Managing LIFO principle
• Genesis in 2003
• National Defence Budget reduced for 2004/05
• 500 / 2000 jobs to be cut in 2003
• To avoid this traditional approach.
• Internal Mobility / competence shifts
  anticipation

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Microwave Systems AB

• Competence Shift at Ericsson
• The announcement
• The coaching of managers
• The coaching of employees
• The implementation of measures
• Results
• 500 people left without any layoffs
• 20 cheaper than a traditional restructuring /
  redundancy

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• High degree of sensitivity in France
• 1997 Renault Vilvoorde 2001 MS, Danone
• Several players involved in managing
  restructuring
• Increased decentralisation and state intervention
• Moulinex from high growth to too much growth?
• Regional to International 10.000 employees
• First crisis symptoms in mid 80s death of
  Founder in 1991
• Succession of bad CEOs and failed recovery plans
• Sept 2001- files for bankruptcy
• 5000 jobs to go 2880 in Lower Normandy

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• State representative appointed
• Employee redeployment regional redevelopment
• Additional compensation
• Conversion agreements for employees
• Re-industrialisation
• Sites reassigned
• Financing for socio-economic revitalisation
• Redundancy program
• Adopted by all but 1 TU
• Financed entirely by the National Employment Fund

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Results of redeployment strategy
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EMCC Restructuring Toolboxwww.emcc.eurofound.eu
.int
European Restructuring Monitor (ERM)
Sectoral Research
Exchange Events
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EMCC list of ingredients for socially responsible
restructurings

• Managerial vision - anticipation
• Continuous communication and dialogue
• Careful and timely planning
• Shared commitment and trust
• Partnership Approach
• Healthy IR climate
• Imagination
• Where possible - Maintenance of workers
  employability

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• Thank you for your attention
• For further information, please visit
• http//www.emcc.eurofound.eu.int
• gcf_at_eurofound.eu.int