graduate engineers and british trans-national business: elite human resource or technical labourers?

GRADUATE ENQINEERS AND BRITISH TRANS-NATIONAL BUSINESS ELITE HUMAN RESOURCE OR TECHNICAL

LABOURERS?

Bryn Jones, Peter Scott, Brian Bolton and Alan Bramley University of Bath

INTRODUCTION

The alleged shortcomings of British engineers’ qualifications and competences, and the superiority of those in other, comparable counties, have been hotly debated for many years. More recently, some attention has focussed on claims that British engineers’ designated tasks often under-utilise their qualifications, while their chances of career development are less promising than those of managers from non-engineering qualifications. During recent decades entry to the engineering profession has been predominantly from graduates; with concomitantly high expectations of challenging work and rapid promotion. Together these trends have exacerbated the problem of how best to optimise the potential asset of highly qualified technical labour. Yet, even in sectors such as electronics, where skill shortages and the necessity of stable R&D teams might be expected to stimulate concerted and detailed career development policies, large firms have difficulty in organising long-term planning specifically for engineers (Causer and Jones, 1993).

The increasing internationalisation of British business, not least due to the approaching completion of the Single European Market, might appear to present a possible remedy to criticism of graduate engineers’ career opportuni ties in large firms. One could envisage scope for the development of more varied careers on a much wider, trans-national scale and a ‘levelling-up‘ of pay, conditions and status for UK engineers towards the standards applying elsewhere, in northern Europe in particular. On the other hand, a contrasting interpretation of employment in British multi-nationals could stress the managerial sophistication and powers of control that stem from corporate size (Ramsay, 19911, leading to policies aimed at minimising professional status and autonomy vis-a-vis the firm’s organisational power (Smith, 1990:460). In extreme cases it would mean treating graduate engineers as another category of technical labour (Smith, 1987187).

Most professional engineers in employment are probably to be found in what are conventionally termed multi-national companies. In 1985 over 50 per cent of UK professional engineers, scientists and technologists were employed in establishments of over 1,000 persons (Mason, 1986). Often these will be branches of different types of multi-national firms. Large size and multi-national status convey an image of complex and sophisticated personnel and training policies. Many graduates’ decisions about prospective employment are probably influenced by this assumption. Such images proliferate in the companies’ glossy recruitment brochures. However, terms such as multi-national, or trans-national corporations often signify a generic type of institution. For a closer analysis such businesses need disaggregating into a number of different enterprise types; at least with respect to the interaction between operations and labour policies. Detailed discussion of this issue is not possible here, but differences in overall structure, including the nature of a multi-national level of organisation, mean different distributions of functions and operations, and thus firms’ use of, and interest in, qualified workers.

34 HUMAN RESOURCE MANAGEMENT JOURNAL VOL 4 NO 1

GRADUATE ENGINEERS AND BRITISH TRANSNATIONAL BUSINESS

For example there are firms which retain R&D and component manufacturing in their ’home’ territory and run only sales, service or possibly routine assembly - ‘screwdriver’ - plants abroad. Others however, such as North American automobile firms, may have national - or at least regional - R&D and core manufacturing operations systematically distributed outside their countries of origin. A further distinction would be the type of overall structure of the business. Some, such as the US auto firms, possess an integrated and bureaucratically organised structure. Other, often British, trans-national companies - of which the extreme case would be Hanson Industries - operate with a decentralised organisation structured by financial controls. A further distinction, of more recent importance, is the variety of trans-national business arrangements which fall short of single enterprise ownership and control. These various types of joint venture, or overseas contracting, fall outside the conventional model of the multi-national company. However, for the utilisation of qualified labour, the implications of their methods of operation may be as, or more, important than in some single-ownership multi-nationals.

Furthermore, the occupations at the centre of our research - graduate-level professional engineers - may be crucially affected by recent shifts towards the sub-contracting of activities such as specialised design, or R&D (Whittington, 1990; Ramsay, 1991). Increasing numbers of these professional workers may work on trans-national business operations without being employed by the conventional multi-national corporation. For all of these reasons, the nine companies whose graduate engineering workforces we have studied should be regarded examples of ’trans-national business’ (TNB), rather than employment in the more stere- otyped ’multi-national corporation’.

What then are the current and prospective developments in the utilisation of graduate engineers? Are organisational variables, especially the nature of involvement in trans- national business, promoting the treatment of these employees as either an elite human resource, or a mass of technical labourers? The current and likely future trajectory of development, described below, follows from preliminary data from our TEST (Technicians’ and Engineers’ Skills and Training) project on the formation and utilisation of graduate engineers. Firstly, we review existing evidence of the ways in which large, internationally focussed firms use professional workers in general, and graduate-level engineers in particular. Modifications to these practices arising from strategic changes, such as increasing transnationality of business activities, have also to be considered at this point. In particular, we identify three ways of utilising engineers: as ’technical labourers’, engineering specialists, and as managerial cadres. Finally, the evidence from a number of our case studies is used to examine how far size, and the advantages of inter-national modi operundi, can be used by firms to improve the development and use of their engineering human resources.

POLICIES FOR UTILISING LABOUR IN BRITISH TNBS: A CORPORATE LOW PRIORITY?

A number of characteristics notable in the labour utilisation policies of UK-owned TNBs have been catalogued by commentators. Notable features include decentralisation and globalisation. As Enderwick (1985:93-4) argues, previous studies show that ’labour management is one of the most decentralised functions‘ within multi-nationals, with British firms

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BRYN JONES, PETER SCOTT, BRIAN BOLTON AND ALAN BRAMLEY UNIVERSITY OF BATH

seemingly in the vanguard of moves to localise bargaining both abroad and at home (see also Incomes Data Services/Institute of Personnel Management [IDS/IPM], 1988). Also, compared with European-owned TNBs, British equivalents have been argued to employ a lower ratio of their employees at ‘home’ and to be ‘globalising’ rather than ‘Europeanising’ their employment. Labour Research Department (1989) found the average percentages for ’home’ employment in French and German trans-nationals to be 70 per cent and 86 per cent respectively. Many British companies employ less than half their total workforce in Europe, not merely the UK alone (see also Ramsay, 1990 and 1991:546; Williams, Williams and Haslam, 1990). In general UK companies demonstrate a more ‘worldwide’ orientation.

It would seem that, in general, the greater trans-national focus of the British multi- nationals is not matched by any greater sophistication or integration of personnel policies. In the top-level corporate strategy of many businesses there are relatively few detailed controls and little cultivation of the human resource in firms’ constituent operations. This situation may be tempered by the completion of the Single European Market, for a growing number of companies are showing interest in becoming more involved in European activity. This is being achieved by several mechanisms, including acquisitions, joint ventures and ‘teaming-up’ with continental companies on individual major capital projects (IDS/IPM, 1988).

At least in principle, the non-parochial business outlook of British firms permits several clear-cut advantages in terms of maximising the development potential of highly qualified staff using the resources of the organisation as a whole. Staff may be transferred to different projects and countries, where their existing skills could be augmented or adapted. In fact, almost all of the current activity recorded in this field has been directed towards management development, with considerably less evidence of mobility in the engineering grades - other than in companies in the computing field. Where such programmes exist, the rationale is of spreading business expertise (Desatnick and Bennett, 19771, breaking down bamers, improving business integration, developing an inter-na tional management group, and enabling accelerated promotion (IDS/lPM, 1988). The exact nature of such schemes vanes with the company’s organisation, structure, and degree of inter-national integration. For instance, the Anglo-Dutch corporation Unilever has one of the most ‘homogenised’ forms of organisation, with a worldwide job evaluation scheme for posts at graduate recruitment level and above. Anyone within these levels is considered to be internationally mobile (IDS/IPM, 1988).

Common to all such management development schemes is at least some level of central coordination or control. Such agency is needed to track the development of the individuals concerned, and also to tackle the most important cross-national structural obstacles to mobility. These are many and daunting. They include a lack of equivalence of qualifications, differences in vocational education and training systems, difficulties with languages, comparability of wages, terms, conditions, grading, and non-salary benefits. Personnel from the UK are often considered to be at a disadvantage in many of the above respects. Competence in foreign languages is notoriously poor in UK companies trading internationally (Metcalf, 1991). The quality of management education has been considerably criticised (inter alh Handy, 1987; Mangham and Silver, 1986). Moreover, the remuneration of British engineers is remarkably low relative to other European standards (Barrie, 1991).



THE UTILISATION OF ENGINEERS

For graduate engineers specifically, a large body of literature has compiled an array of alleged shortcomings in their treatment. Fora long time, and on into the 1980s, the dominant concerns voiced by influential commentators in the UK were of poor pay, low status, a lack of professional vigour in training, and insufficient numbers entering the engineering profession (Gerstl and Hutton, 1966; Finniston, 1980). Our interpretation of the literature and of interviews with senior managers and training experts suggests the following contradictions in 1.

2.

3.

4.

the utilisation of graduate-level engineers. The enormous expansion of graduating engineers has been at the expense of training and employment of technicians. On recruitment, graduate engineers tend often to be assigned to technician-level tasks, from which it is later difficult to move because of inadequate career ladders and competition from the large numbers of peers. Corporate-level managements are distracted from reforming this situation because their preferences for corporate-wide career paths conflict with the short-term and direct skill requirements of the local managers of operations and functions, or because replacement from the continuing supply of new graduate recruits is possible. Without systematic and finely-tuned corporate-level procedures, it is often not clear to either graduates or managements whether engineers’ career aspirations would be best directed towards managerial roles or specialist engineering functions, such as R&D.

It is therefore unsurprising that from the mid-1980s the focus of concern has shifted increasingly towards topics informed by the broad agenda of human resource management. Among others, the difficulties that are now openly acknowledged as policy issues for major companies are defined as: initial training of graduate entrants, utilisation of engineering staff and their further career progression, and - at least prior to the recent recession - unacceptably low retention rates in some of the more ’high profile’ sectors, notably aerospace and electronics.

Training

Research on in-company training indicates problems in the amount, effectiveness, and sometimes the organisation of training given. Although the vast majority of new recruits probably receive formal training from their employer (Clarke and Rees, 1989; Keenan and Newton, 1984a1, Keenan and Newton found that 10 per cent of their survey population of graduate engineers received no training at all. The same sample of gaduate engineers were equally split on their satisfaction, or otherwise, with their training. The longitudinal survey on trainee engineers found that graduates evaluate poorly the effectiveness of much of the in-company training they receive, especially in non-technical subjects. Especially poorly regarded were all aspects of management training, but training in communication studies and design also came in for criticism. Also criticised were the lack of workshop practice in training, or emphasis on interpersonal skills or finance (Keenan and Newton, 1984b; Newton and Keenan, 1985). One fifth of this sample were not satisfied that their training was geared towards chartered status (Keenan and Newton, 1984a). From the employers’ point of view, even in R&D-focussed firms, some of these inadequacies may be explained by uncertainties in both budgets and knowledge of future skill requirements (Causer and Jones, 1993).


BRYN JONES, PETER SCOlT, BRIAN BOLTON AND ALAN BRAMLEY UNIVERSITY OF BATH

Utilisation and career development

Several research teams have recently drawn attention both to the underemployment and to the lack of further training and technical career development afforded to engineers. These factors are argued to be prime movers in the observable drift of engineers from technical into non-engineering forms of work. The most detailed of these studies are restricted to the UK electronics industry, but they raise more widely applicable issues. There is a characteristic gradual movement of British engineers - certainly in comparison with the 'technical expert' role of their American colleagues - out of strictly engineering work and into the ranks of management. Thurley and Lam's (1990) study of electronics firms owned by UK-based multi- nationals suggests that this movement arises from the unrewarding and unfulfilling experience of routine technical employment incommensurate with engineers' qualification level. Engineers are repeatedly assigned isolating and subdivided development work, much of which could, and should, be undertaken by technicians, were there enough technicians available to do so.

Causer and Jones's (1989, 1990, 1993) study of electronics firms of differing size and ownership type provides more detailed evidence on the interplay of technical and managerial tasks in the course of engineering careers. This study focusses mainly on engineers in research, design and development. Unlike Thurley and Lam, Causer and Jones find that large organisations and major multi-site companies in electronics are able to offer structured career paths and often fairly rapid promotion into the lower reaches of management to engineers aged up to approximately thirty. Not coincidentally, these types of firm are also by far the largest recruiters of graduate engineers. The companies concerned acknowledged that such a strategy is a means of retaining staff at their potentially most mobile phase by providing challenges and the possibility of gradual assumption of managerial responsibility. Smaller independent firms display more limited career structures, although here the possibility of fusing technical and managerial tasks is the greater. Such firms tend to be less constrained in their reward systems than the large companies, where there are greater industrial relations implications for wage differentials between various individuals and bargaining groups.

After this age point of about thirty, Causer and Jones draw attention to a phenomenon of 'career plateaus'; after which promotion opportunities within the same organisation become decidedly slimmer with obvious effects upon morale. Such opportunities as do exist almost invariably presuppose the substitution of managerial for engineering work. Some establishments in the study with large engineering departments attempted to circumvent such problems with the establishment of dual 'managerial' and 'technical' promotion ladders. However, these seem to be no panacea for retaining engineers within engineering work even the 'technical' ladder involves the increasing assignation of 'managerial' tasks such as leading sections or project teams, and the ceiling for advancement on the 'technical' track is more circumscribed (Causer and Jones, 1990 and 1993).

Wastage and graduate mobility

Research into the early stages of careers of graduates of all subjects finds a high initial mobility between employers (Brennan and McGeevor, 1986; Parsons and Hutt, 1981). This general trend is replicated amongst engineering graduates (Berthoud and Smith, 1980;



Parsons, 1985). Despite being more oriented to a specific professional career than other undergraduates who enter industry, it has been argued that job changing is typical of the early working lives of engineers (Williamson, 1981). Berthoud and Smith (1980) also found a distinct early movement out of practising engineering work into other types of job, as the graduates form clearer future career goals.

EVIDENCE FROM THE ‘TEST’ CASE STUDIES

Most major recruiters of graduate engineers could be described as multi-nationals; if we use the term ’multi-national’ -at least in the British context - to describe several types of enterprise and ways of managing labour. In addition to the conventionaI types of multi-national firms, the increasing internationalisation of business and the further integration of European markets is also now influencing highly qualified engineering employment amongst the TNB operations of other large British firms. Three main questions can therefore be put to our preliminary set of data. 1. Do some types of trans-national business have special resources to help resolve the

problems of routine employment of graduate engineers? 2. If they do have those resources, are they actually applying them? 3. Are the policies that are being implemented aimed at treating engineers as a ‘mass

occupation’ (Braverman, 1974243) like other industrial jobs, or at rescuing and cultivat- ing them as a potential elite by sophisticated human resource management policies?

The initial results from our investigations within eight multi-divisional British firms suggest that many of the above problems have not, as yet, been remedied by new policies. The interviews confirm that graduate engineers are often employed in jobs requiring considerably less than their full capabilites. In many such cases, more detailed personnel needs analysis might indicate that technician-level employees are more appropriate. Even then, work practices, middle management norms and attitudes, plus organisational politics may well present obstacles to actually changing the status quo.

There is, however, a widespread, though by no means universal, expectation that many of the current generation of engineers are destined for eventual transfer to the ranks of future management. Selection procedures often anticipate this development. It is particularly important for the chemical industry, which faces a ’generation gap’ of managers in the near future. The actual likelihood of progression into management does of course vary. It is perhaps somewhat less likely in sectors such as aerospace and electronics, which have traditionally taken in large numbers of technically specialised graduates in the past. Interviews detected some internal dissension about the extent to which future career patterns will move towards a ‘generalist managerialist’ model rather than a ’technical specialist’ one.

Barriers to career development were certainly still evident, with restricted promotion opportunities often reported. Indeed, the perpetuation of graduate under-utilisation in some companies may be directly linked to insufficient opportunity for long-term career progression for graduate engineers aged in their late twenties to early thirties. Traditional career routes from engineering into managerial work are blocked. As managers at firms such as Airlines, Rotors, and Phones argued, there are currently ’insufficient dead men’s shoes available’ to promote new graduates to more senior positions. Increasing recruitment



of other graduates directly into general management, similar congestion in their ranks, and organisational streamlining have all contributed to these blockages, which become evident several years after the graduate has been with the company. In our sample they occur especially in graduate-heavy large organisations such as those within the aerospace and electronics sectors, and have been intensified by the labour shake-out of the post-1990 recession.

A similar story occurred, slightly earlier, in parts of the chemical industry. Because the sector expanded rapidly in the sixties and then stagnated in the following decade, there are now extremely limited promotion possibilities for engineers in their early thirties into the more senior management posts. These are currently staffed by engineers in their forties and fifties. Within existing parameters, only judicious use of international career moves can overcome this blockage; a strategy to which we return below. As a tool for analysis, let us identify three loose ‘models’ according to which TNBs may utilise graduate engineers. 1. As general technical labour. In this model there is little distinctive or special significance

attributed to the fact that the engineer possesses a degree. Decisions on the tasks allocated to engineers are made at the level of the individual work unit concerned; there is no corporate intervention in preferring the allocation of particular sorts of task to given grades of labour. Technicians and graduate engineers may be treated as interchangeable categories of labour in many respects. This type of approach occurs most frequently in highly devolved business units.

2. As engineering specialists. Engineers will tend to be concentrated in business functions traditionally demanding relatively high conceptual or innovative inputs. Primarily, this concerns the research and development and the more abstract design functions. Less interchangeability with technicians, either functionally or locationally, is apparent than in the above scenario. This model does not necessarily presuppose a much enhanced role for the corporate level, although the TNB may well spatially reconstitute the division of manufacturing functions. However, where, for example, innovation is a corporate priority, the corporate level may be more directive. In some cases it may promote central R&D laboratory facilities, which concentrate large proportions of scientists, technologists and engineers, and which sell their activities to other cost centres in the corporation.

3. As a corporate human resource. Here there is significant intervention at corporate level in the recruitment, training and career development of graduate engineers, which may override local autonomy of operating units. Graduates are viewed as having superior knowledge, analytic, planning or technical skills, or specific leadership potential - notably as future managers - which must be centrally nurtured and guided if it is not to be dissipated. The extensive variety of resources specifically open to firms with TNB dimensions are brought to bear. This model implies strategic decision-making over labour resource issues; at least at graduate entry level and above.

Below we present relevant evidence from case studies of eight businesses in our cross- sectoral research on the skills, utilisation and training of technical staff in UK industry. All eight cases are multi-national at least in terms of ownership or markets and, in four cases, in terms of operation as well. Detailed interviewing of engineeers, technicians and managers at particular sites is continuing. Although we report here only the initial enquiries, carried out mainly at company or group level, they have the advantage of covering a wide range of

40 HUMAN RESOURCE MANAGEMENT JOLJRNAL,VOL 4 NO 1


different operations, within the overall company’s sphere of activities. Further details of these cases are included in the Appendix below. The businesses studied can be divided into three groups, as follows.

Companies having mainly UK or some degree of ultimate trans-national ownership, with plants in the UK only, but national or international markets (Electrogroup, Phones,

Engines, Rotors, Microflight). ’International cooperative links‘. Companies operating as multi-national consortia,

with plants in more than one country, or teamed up with foreign manufacturers for particular ‘one-off‘ major manufacturing projects. These firms also have international markets (Airlines, Powerplant).

‘True trans-nationals’. UK-based companies having trans-national ownership, plants in more than one country, international markets, and with sufficient central control to

intervene throughout the conglomerate at least on certain policy matters (Partsgroup, Chemicals). Amongst the three types, differences are especially noticeable between the practices of the

first category on the one hand and the final two groups on the other. The first type are able to provide experience ’in the field‘ for engineers’ career development in cases where the companies’ markets are international. It consists largely of their use as technically-trained sales personnel - with engineering knowledge - or as service or installation engineers. This was found particularly in the aerospace category. At Engines, for example, recruitment to positions in the sales and marketing sphere tended to be reserved as promotion slots for engineers of some years’ previous standing in a technical specialism. For the current discussion, the practices of the last two types are particularly interesting: they seem often to permit greater potential for aspiring graduates in both the initial training and the career development phases of employment. Tnternational cooperative links’ and ’true trans- nationals’ have at least the possibility to exploit the multi-national aspects of their businesses in terms of the scale and technological complexity of a range of trans-national operations.

Most of the companies deployed their engineer graduates as engineering specialists, concentrating them in product design and development functions in particular. Neverthe- less, in several cases -particularly in development or production areas - there was evidence of considerable overlap with more routine work that would more normally be considered the province of technicians. Yet, as we discuss below, the type of trans-national business undertaken, together with other factors, could mitigate the effects of this overlap. Although internal promotion paths are normally national within the same subsidiary.

It is when multi-national companies are willing to intervene in personnel policy matters affecting their subordinate businessunits that one sees the true potential of TNBs to optimise staff utilisation and to exploit the advantages of multi-national status. Our research has uncovered some examples of these arrangements; although it should be borne in mind that both of the following examples are in some senses atypical of wider corporate behaviour. The firm taking part in a joint business link with a continental European corporation (Powerplant) provides an illustration of upgrading training and career development. The company business now involves frequent interchange with the European partner, involving improvement of language capabilities, as well as sending more engineers to the European plants. This is one means by which a company may augment an existing reputation as a



provider of training by alsoappearing as a potential source of wider career development. We hope that further data, currently being processed, will show whether the renowned high status of European engineers may boost the career development available to engineers based in the UK plants. Similar inter-national mobility -albeit more short-term and project-specific - exists at Airlines for some engineers participating in the European project team on a major aircraft.

Both Partsgroup and Chemicals represent, to different degrees, attempts to apply a ‘strategic’ HRh4 approach to the utilisation and development of graduate engineers. Both corporations have treated graduate recruitment and training as a corporate responsibility in recent years. In the expansion of graduate recruits, mechanical engineering lagged somewhat behind aerospace and electronics. Consequently, Partsgroup has gained some of the ’advantages of backwardness’ in their more recent corporate promotion of graduate recruitment at plant and divisional levels. During the eighties Partsgroup developed a gradual corporate centralisation of responsibility for graduate recruitment and training, as part of a conscious strategy initiative to increase constituent companies’ use of graduates. This was then an unusual policy development for the group. Normally no corporate intervention, beyond the financial sphere, occurred in matters affecting the running of subsidiary businesses. Partsgroup had previously exemplified Loveridge’s (1981) concept of the ’federal firm’: loose central management and quasi-autonomous personnel practices of local operations. The 1960s’ failure of a corporate graduate training scheme shows the subsidiaries‘ associated independ- ence in staffing policies. It failed, at least partly, because the subsidiaries saw it as ‘outside interference‘ in the running of their affairs.

In 1983 Partsgroup’s main R&D subsidiary conceived a scheme to boost the hitherto minimal penetration of graduate engineers into the group’s somewhat traditional manufacturing businesses. In their words, ’we had to create the demand, for expanding the territory of graduate engineers beyond the R&D function into operational areas too.’ The managers in the former subsidiary linked the scheme to improving the qualification level and the technological sophistication of manufacturing in the group as a whole. Graduates would be recruited to the subsidiary and then ’hired out‘, free of charge, for two years to other companies within the group; although ultimately the graduate training scheme is not ’free’ to constituent companies, as they pay to corporate level through a financial levy. By providing practical proof of the value of graduate-level skills to subsidiaries, it was hoped that the latter would then want to employ the graduates directly themselves. After five years the administration of the scheme was transferred to one of the group’s main automotive parts manufacturing subsidiaries; in 1991 Partsgroup took on the running and funding of the scheme at corporate level. In this stage, the graduate programme now runs an engineering and a business stream, and it covers all the UK Subsidiaries. It was planned to extend the scheme to cover the company’s joint ventures and European businesses.

This two-year graduate training scheme gives to graduates working placements provided by the company’s UK and international subsidiaries. It has proved relatively easy to ‘export‘ UK graduate trainees to European subsidiaries, but the company admits that there is less traffic of graduates in the opposite direction - because of what are perceived as relatively lower wages and conditions in the UK. Considerable reduction in the group’s graduate wastage figures is claimed. The scheme’s originators attributed its success to a gradual

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achievement of widespread respect for the scheme throughout the company’s subsidiaries, and commitment from top group management. For graduates, the programme incorporates a number of attractions that they have themselves demanded in the past; such as ability to assume responsibility, to learn a foreign language, and overseas employment opportunities. The genuinely multi-national focus of this firm’s trade and organisation is clearly stimulating and facilitating a proactive and, to a certain extent, trans-national concentation of graduate engineers as a high grade human resource.

Chemicals has a more intermittent experience with corporate graduate training schemes, although most graduates are recruited by the corporate level in the first instance. In the mid- 1980s the company used a corporate approach to the intake of engineers to ‘kick-start‘ graduate recruitment. For there had been a lengthy period during which the chemical industry as a whole had undertaken little recruitment as a result of ’over-expansion’ in the sixties. A corporate graduate training budget was set up to assist the introduction of new engineering personnel who could eventually fill an approaching ‘generation gap’ of managers.

Presently, Chemicals has relinquished this approach, preferring to devolve all training costs to plant level. This reversion to individual cost centres taking responsibility for training does not appear to have significantly undermined the historical principle of global mobility for engineers in the company. However, some specific problems have been encountered with plant managers trying to retain scarce control engineers. There is a fairly sophisticated process of corporately overseeing graduate engineers’ career development; with movement to various global positions in the plants before return to corporate level as managers some years later. Currently, corporate managers feel that a central approach to funding training may soon have to be reapplied to overcome some shortfall arising from intense cost-cutting pressures at plant level.

Chemicals also confirms the qualitative difference that a genuine spread of centrally coordinated multi-national operations can make to the utilisation of the graduate engineer. Recruitment is corporately controlled and the centre has demonstrated its capability to plan career paths for individuals throughout its globaloperations, over and beyond the needs and demands of local managements. Even here, however, in a firm with longstanding central controls and resources, the corporate role has become partly reactive as a result of the deleterious effects of financial controls based on cost-centre forms of autonomy.

CONCLUSION

The overall picture emerging from these research findings is one of considerable variation in corporate intervention into the career development of graduate engineers. As we noted above, strategic intervention to provide corporate-level career paths for engineers may be weakened by the strength of the pressure towards decentralisation of UK-based companies during the eighties. Engineers are still employed either as technical specialists or as surrogate technicians. Specific forms of work organisation may mean that they are often underem- ployed in such roles. Compared with non-engineering based management specialists their promotion prospects remain relatively poor. However, while their work roles may, in some cases, resemble that of highly qualified technical labourers, their employment relationship and career potential are more ambiguous. The high turnover in some firms suggests that


BRYN JONES, PETER SCOIT, BRIAN BOLTON AND ALAN BRAMLEY UNIVERSITY OF BATH

advancement is sought by quitting the firm. The dividing line between 'engineer' and 'manager' is imprecise, and it becomes more so as careers progress. At the moment, however, the non-engineering 'management specialist' is more commonly seen as the 'elite human resource' of the TNB.

On the other hand, there are some determined interventions to break this mould. Involve- ment in international collaborative business links and project teams constitutes an independent influence to widen firms' focus towards the broader development of engineering personnel. More proactively, TNBs such as Partsgroup have gradually adopted a strategy of upgrading their technical manpower capabilities on a European basis. Important parts of this strategy concern the spread of graduate-level engineering knowledge throughout the company's operations and the use of European integration to incorporate the lessons of continental manufacturing success.

Central interventionist policies, such as those pursued by Partsgroup, may be exceptional - in both senses of the word - amongst British trans-national business in general and the narrower form of the singly-owned multi-national operations corporation. Our, admittedly selective, sample of firms suggests that the British syndrome of localised operations with loose central controls - Loveridge's 'federal firm' - has tended to go hand in hand with a pattern of work and employment resembling a technical labourer model for graduate engineers. However, graduate aspirations - a factor that we are currently investigating in these firms - have persisted and been manifested in high labour turnover. Moreover, most of the corporate-level managements in these businesses, whatever their structural and trading characteristics, acknowledge this 'degradation' problem. They see it as their priority to construct, and sometimes control, promotion and career tracks that will optimise use of the best of the graduates consigned to the technical coal-face of their operations.

Yet the limits of this new approach are also important. Other authors have noted the difference between British generalist, commerce-oriented management formation and the more routine ascension of qualified engineers into a different style of management in German firms - one which is based more on product and process competences (Warner, 1992). It is even possible, we would suggest, to envisage the development of a new compromise British model as a response to the renewed pressures of international, and especially European, competition and collaboration. If some of the practices emerging in our case studies are indicative, then British trans-national businesses may be groping towards a new system. This would be one of elite sponsorship of engineers into management-level posts, through selected human resource management techniques, rather than the upgrading of engineering competence in general.



APPENDIX

METHODS AND CASE STUDY FIRMS

The initial phase of our research reported here provided overall data on graduate engineers‘ skills and training through semi-structured interviews with senior recruitment, staff development, and training managers in some of the largest firms in different manufacturing sectors. Most of these managers held positions at grouplevel. The case-study companies were chosen on the basis that they are large employers of graduate engineers in their UK operations and exhibit product and organisational characteristics that are typical of the sectors in which they operate as a whole.

The firms involved operate in the following sectors: electronics, aerospace, chemicals, and the machinery/metal goods industries. Companies have been allocated codenames to preserve anonymity.

Electrogroup. This is a group of mainly electronics sector subsidiaries, operating under the overall ownership of one of Britain’s largest private manufacturing companies. Two subsidiaries of this group are included in the project in their own right. la. Phones. This is one of Britain’s major manufacturers of telecommunications

equipment, formed recently through a merger of two leading companies in this field. Its sales in the financial year ending March 1990 were €877 billion. It employs approximately 20,000 workers overall on several sites throughout the country, although significant redundancies have occurred in 1992. Microflight. An aerospace electronics company concerned with electronic flight equipment for both civil and military customers. The firm’s main site is in the Home Counties and the company presently employs some 5,500. Current data for sales are unavailable.

lb.

Engines. This is part of a diversified group with interests in aerospace, power and other engineering. Group sales in 1989 were €3 billion. The division under investigation is a large manufacturer of jet aero-engines. It has 8,500 employees on the case-study site, which makes mainly military engines. Rotors. A manufacturer of helicopters and aircraft parts. Now partly foreign-owned, it is mainly known for military helicopters. It also makes a range of civilian products and is currently trying to expand this side of the business. 1989 sales were €432 billion. It operates mainly from the site being studied. Airlines. A major British manufacturer of aircraft and allied equipment, although it has diversified into various other business areas too. A reorganisation of the management structure took effect in February 1992. Sales for the whole group in 1990 were €10.5 billion. Our case study is the company division manufacturing a major European civil airliner: a project involving considerable collaboration with a European manufacturing unit. This division of the company has 5,000 employees on the site under study. Manufacturing capability is also located at one other plant in Britain and one on the continent.


BRYN JONES, PETER SCOTT, BRIAN BOLTON AND ALAN BRAMLEY UNNERSITY OF BATH

5. Partsgroup: A divisionalised UK-based trans-national company which is concerned with a very wide range of automotive components and basic metal goods, and has also diversified into a number of service industries. Employment for the whole group is currently 35,900, approximately 6,000 of whom are in the UK, and sales in 1989 were €2,000 billion. The company has developed a very strong European presence in its manufacturing base in recent years.

6. Chemicals. A major British manufacturer of general and special chemicals, agricultural chemicals, phosphates, detergents, etc., but with ultimate ownership by an American trans-national corporation. Chemicals operates on five sites in the UK and also has over twenty factories in thirteen other countries worldwide. Group turnover figures for 1990 were approximately €600 billion and the company employs some 6,200 workers in total.

7. Powerplant. A cooperative link between the power generating equipment division of a UK-owned parent company and the parallel division of a continental European firm. The group as a whole employed some 40,000 persons in total and had sales of €881 billion in 1990. The Anglo-European subsidiary under investigation manufactures turbine generators and heavy power generation equipment at various locations. The site studied currently employs approximately 1,800 workers.

In addition to these firms/sectors the TEST project is also studying a privatised regional electricity distribution company, operating in sub-national markets, without any international activities.



NOTE

An earlier version of this article was given as a paper to the Warwick VET Forum National Conference on ‘Multi-National Companies and Human Resources: A Moveable Feast?’, University of Warwick, 22-24 June 1992. The research on which it is based is funded by the ESRC/SERC Joint Committee’s initiative on the Successful Management of Technological Change. The authors are grateful to Keith Sisson for advice on revisions.

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graduate engineers and british trans-national business: elite human resource or technical labourers?

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