The Challenges Facing Ireland Inc.

Jim Collins BSc, MBA, MCMI

Ahearne Collins & Associates Ltd.

© 2005 Ahearne Collins & Associates Ltd

Enterprise Strategy Group Report

“Ahead of the Curve” Report published 2004

Key Challenges identified• Exponential change in scale of Globalisation• Increased Irish cost base• Corporate tax rate competitive emulation• Limited export growth of indigenous companies• Imminent changes in EU state aid limits• Services becoming major GDP growth driver• Knowledge as driver of economic development

© 2005 Ahearne Collins & Associates Ltd

The Challenges

Globalisation• The China Price!

• 38 million educated citizens working in manufacturing facilities in Cities and a further 70 million in suburbs & rural locations

• Average city wage @ $1/hour, rural @ $0.45/hour

Irish Cost Base• 2003: € appreciated 20% vs $ & 8% vs £.

• Irish price levels deteriorated 14% & are now 12% above the average EU cost base.

• 1999: highest net job creation & highest job losses.

• Last 4 years: 33,000 jobs lost, over 50% in the high tech sector.

© 2005 Ahearne Collins & Associates Ltd

ESG Report / ctd

Making it Happen

© 2005 Ahearne Collins & Associates Ltd

Opportunities

High value-added manufacturing …..Will remain a fundamental component of Ireland’s enterprise environment

Export GrowthThe $100 billion club! 1

• 2004: 16 countries exporting >$100 billion of Manufactured goods• Next 2 Years: Joined by Russia, Malaysia & Ireland!

1 Stephen Gould VP US National Assoc. of Manufacturers, Future Manufacturing Forum, Sept 26 th 2005

© 2005 Ahearne Collins & Associates Ltd

Realising the Potential

World-class Skills, Education & Training• Upskilling general workforce

• Lifelong skills development

• Distinction in HE graduate quality

Cost Competitiveness• Partnership• Rewarding workplace productivity• Focus on Adding Value not Cost

Management Capability• Business networks

© 2005 Ahearne Collins & Associates Ltd

The Lean Solution

Engage & Empower Employees

Pursuit of Perfection & Elimination of Waste

Providing Added Value to Customers

Efficiency and Effectiveness

Partnership

© 2005 Ahearne Collins & Associates Ltd

Ohno…

The Toyota Way

Defining Work• Advance in the process &

enhance the added value• Motion ≠ Work

Respecting Humanity• Employees give valuable time

& energy• Company provides opportunity

to do meaningful work• People’s sense of value

requires worthwhile work

A man-hour is something that we can always count.

Manpower is beyond measurement.

Capabilities can be extended infinitely when everyone

begins to think !