Volvo Cars Engine, Sweden: Fostering employability
Volvo Cars Engine (VCE) is part of Volvo Cars, a company fully owned by Ford. VCE produces engines for car production in Volvo cars. VCE is a leading user of total productivity maintenance (TPM). The competence development process is supported by a competence agreement between the local partners. Individual development is based on a personal review between worker and manager which is supposed to lead to a development plan. The Volvo Centre for Competence is an in-house unit supporting training and other learning activities in the organisation.
Volvo Cars Engine (VCE) is a part of Volvo Cars, a company fully owned by Ford. VCE produces engines and other components for other units. The main part (1,700 employees out of 2,900) is situated in Skövde, a mid-sized city in the west of Sweden. For a number of years, VCE has been a leading user of the total productivity maintenance (TPM) concept. In Skövde, an internal training centre has also been established – the Volvo Competence Centre (VCC), which provides technological, business and social training. Due to the success of the TPM concept, part of the training is also available for external clients. In Skövde, a majority of the workers (over 90%) is organised either in the Swedish Metal Workers Union (blue collar), the Swedish Confederation for Salaried Employees (white collar) or the Confederation for Professional Associations (mainly civil engineers). Only about 23% of the employees are women. A target was set for 2006 to achieve female representation of 16% on all levels, reflecting the distribution in the workforce.
In the late 1990s, Volvo was bought by Ford and since then has been in a process of integrating different systems and processes. Some of the adjustments to the Ford management and production system have included the process-based organisation, together with work in larger, goal-oriented teams (modules).
The Swedish industry is deeply involved in issues on vocational training and faces some problems in making industrial work attractive for young people, especially in light of an increasing number of retirements in the near future. Many companies, Volvo Cars included, are engaged in setting up special upper secondary schools. The Volvo Gymnasium has been in operation since 1952. There is a central agreement in Volvo Cars, Sweden between the employer and the Metal Workers Union on vocational training, including trainee positions and occupational health and safety (OHS) and introduction programmes for trainees, cooperation between companies and schools, etc.
Description of the initiative
Competence development is built on a competence agreement at Volvo Cars level which regulates the conditions for training based on the need of an individual for the competence development. Competence development on a general level takes its starting point in the Volvo vision on teamwork, leadership and co-workership. A special local competence committee with representatives from HR management and the union (Ifmetall – a blue-collar union) monitors the process. There is a set of measures:
- a process for competence analysis showing the competence profile for the company;
- personal reviews between manager and worker;
- an individual development plan based on a contract between manager and worker stipulating agreed training and other measures one to three years ahead;
- measures to be taken in the event of organisational change, downsizing, etc.;
- subsidies for training costs (fees and material) for job-related individual training outside working hours.
The competence development is based on the five-year business plan and the two main processes as well as external regulations (OHS, environment) and internal ones (TPM).
Each operational manager has two days each year at his disposal for teamwork training. It could be based on the general personnel attitude survey carried out every second year. Supervisors are offered support from the HR department. There is also a management course on business and personal leadership twice a year.
Training has also been an important issue in shifting people between different flows (100 were trained in going from assembly to melding) as well as demands on a higher functional flexibility due to more intensive, lean production and the TPM system (e.g. on maintenance). There is a trend in the company going from a more centralised approach built on formal training through courses to more workplace-oriented learning built on a larger responsibility from operational managers (personal reviews and competence plans). Part of this strategy has been to appoint local training representatives in the production teams to take on responsibility for different parts in the process. To support this, there is a training strategy built on ‘short stop training’, i.e. half-day training directly on the work floor. Another important development is recognising training issues earlier in the project development in order to achieve a more effective implementation process.
There is also a component in the individually and competence-based wage system that is being appraised – the capacity for teaching others. The wage system in general is built on a competence ladder and individual wage reviews (follow-up to the personal reviews).
In order to secure specific competence needs, every year a number of candidates (15 in 2005) for managerial and/or technical positions are appointed for a training programme for 12 to 18 months. For those who study core subjects at upper secondary school level, there is a bonus of EUR200 for literature, etc.
VCC plays an important role as internal supplier of training facilities and trainers/teachers. They have about 25 employees (trainers, etc.), half of them working for external clients. VCC gets their revenue from the organisation and externally (turnaround of EUR4 million) and is supposed to cover its own costs. The internal services they provide are regular training programmes on technical and administrative issues to support managers and employees on validating individuals and profiling competence needs. They also develop more individual- and workplace-based learning methods (short stop training, supervised internal company-based self-studies, training of local training representatives and competence controllers).
There are a number of external training actions also taking place, many of them organised by VCC. For instance, every year a summer course is organised for 14- to 15-year-old girls in order to stimulate women’s career choices. VCC also runs an automotive-oriented programme as a so-called ‘free school’ in the upper secondary school, with around 30 pupils every year who are employed from the first day.
Volvo Cars has a long tradition of competence development, some of it based on a Volvo tradition of co-workership and the development of work organisation. Management and the blue-collar worker union (If Metall) work as partners on competence development based on the competence agreement and joint committees. White-collar unions and professionals are not part of that system. Through the process-oriented work based on TPM, the competence process is visualised in itself and the measures that need to be taken and the responsibilities are clarified. The internal competence centre (VCC) plays an important role in supporting managers and co-workers.
The Volvo system for competence development is changing both in regard to changes in production and to new competence strategies. Lean production limits the time available for competence development. Larger teams limit the possibilities for team-based competence development, but at the same time increase the demand for multi-skilled personnel in order to move between different stations. TPM upgrades the need for maintenance competence. There is still much to do in order to have a better impact on some measures, such as personal reviews and written development plans/contracts. Regarding diversity, a target of female representation of at least 20% on all positions has been set.
At the same time, the competence strategy is slowly changing from a supply-driven to a more demand- and organisational-driven strategy where line managers play an increasingly important role. Measures are taken to create more workplace-based learning opportunities, but are also more individually adjusted. This is done in the framework of a highly conscious competence development infrastructure linked to the process-oriented work (TPM) and joint cooperation.
Exemplary and contextual factors
Volvo Cars illustrates a very structured competence process linked to the production process, but at the same time with much support for the individuals and their competence development needs. It is also built on a co-partnership between management and the workers union relating to an agreement as well as joint committee work. The internal competence centre is a unique resource in supporting training and workplace-based learning. Line management is obtaining an increasingly important role in the strategy. Through the competence centre, it also goes beyond company boundaries and short-term training by offering young people in the area education on a more long-term basis.
Per Tengbland, AB & ATK Arbetsliv, Stockholm