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Journal cover: Journal of European Industrial Training

Journal of European Industrial Training

ISSN: 0309-0590
Currently published as: European Journal of Training and Development

Online from: 1977

Subject Area: Learning and Development

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Outward foreign direct investment and human capital development: A small country perspective

Document Information:
Title:Outward foreign direct investment and human capital development: A small country perspective
Author(s):Anthony McDonnell, (Department of Personnel and Employment Relations, University of Limerick, Limerick, Ireland)
Citation:Anthony McDonnell, (2008) "Outward foreign direct investment and human capital development: A small country perspective", Journal of European Industrial Training, Vol. 32 Iss: 6, pp.452 - 471
Keywords:International investments, Ireland, Management development, Multinational companies, Succession planning, Training
Article type:Research paper
DOI:10.1108/03090590810886562 (Permanent URL)
Publisher:Emerald Group Publishing Limited
Acknowledgements:The author would like to acknowledge the support received from the Irish Research Council for the Humanities and Social Sciences (IRCHSS), the Labour Relations Commission and the University of Limerick Research Office. In addition, the author would like to thank Jonathan Lavelle, Paddy Gunnigle and the Economic and Social Research Institute (ESRI) for their assistance and advice.

Purpose – The purpose of this paper is to examine the pattern of outward foreign direct investment (FDI) by Irish MNCs, and more specifically, to investigate their approach to human capital development and how these correspond to foreign MNCs in Ireland. In particular, it seeks to investigate training and development expenditure, adoption of succession planning, use of formal development programmes for senior management “potential”, and also the presence of a specific “key group” development programme.

Design/methodology/approach – Data were obtained through the largest, most representative study ever conducted on multinational companies (MNCs) in Ireland. The most senior human resources practitioner in these firms completed a questionnaire, through the personal interview medium, on various facets of their human resource management (HRM) practices. In total 260 usable interviews were completed equating to an overall response rate of 63 per cent. This represents a 78 per cent response rate for Irish MNCs, the primary focus of this paper, and 60 per cent for foreign MNCs.

Findings – Overall, Irish MNCs tend to compare favourably with their foreign counterparts in terms of the human capital development mechanisms examined. Only one statistically significant association was found regarding differences between Irish and foreign owned MNCs, Irish MNCs were found to be significantly less likely to have formal management development programmes.

Originality/value – The study is the first large scale, representative survey to be conducted on MNCs in Ireland helping to address the research lacuna on Irish owned MNCs.

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