Workforce Planning for a Global Automotive Economy

Abstract

Watson Wyatt Worldwide recently partnered with the University of Michigan Transportation Research Institute's (UMTRI) Office for the Study of Automotive Transportation (OSAT) to investigate how automotive suppliers manage their global human resources (HR). Based on 20 executive interviews at 14 major Tier 1 suppliers, this study shows that suppliers face unprecedented human resource challenges as they rapidly globalize their activities. Although Tier 1 suppliers recognize the importance of human capital to successful globalization, our results indicate that suppliers do not sufficiently use their HR departments to predict human capital needs. As these companies face critical talent shortages in required locales, particularly in highly-skilled positions such as engineering, a more systemic approach to staffing would reduce costs and improve efficiency. Suppliers often feel forced to choose managers with functional experience over those with local cultural and legal knowledge, but both are critical to succeeding overseas. In the end, HR is a major challenge - and solution - to globalizing an organization. Recruiting, retaining and deploying the right people to supervise and staff operations is difficult. Yet the ability of HR to anticipate and aid companies through workforce planning and monitoring, as well as training and supporting expatriate managers, can give companies a long-term competitive advantage. Offering HR a seat at the table before globalization decisions are made can ensure fewer negative surprises and a smoother entry into new markets and production locations.