Structural changes in 2011
In June 2011, Wärtsilä signed an agreement to establish a joint venture for manufacturing medium-speed marine engines in China together with Jiangsu CuiXing Marine Offshore Engineering. Wärtsilä’s share of the joint venture is 49% and Jiangsu CuiXing's share is 51%. The joint venture’s production facilities in the Rugao city of Nantong, in Jiangsu province in Eastern China will focus on the assembly and testing of engines. Operations are planned to start early in 2013.
In July 2011, Wärtsilä announced the acquisition of Cedervall, one of the leading manufacturers of shaft seal and bearing systems for the marine industry. Cedervall is headquartered in Gothenburg, Sweden, and the company has subsidiaries in Spain, China and Singapore, with manufacturing facilities in Sweden, China and Spain. The company employs 211 people.
Wärtsilä inaugurated its new spare parts distribution centre in Kampen, the Netherlands in November 2011. The Central Distribution Centre is the core of Wärtsilä Global Logistics Services and integrates eight spare parts warehouses into one global supply chain operation. The new distribution centre began its operations in December 2010 and was fully operational by the end of 2011. The Central Distribution Centre will employ approximately 140 people.
A global project concerning support functions was kicked off already in March 2010. The global evaluation of every support function was carried out in the spring, and implementation plans were drawn up during the autumn. The main part of the implementation of the new business support functions has been done in due course in 2011 in order to create a new organisational design for the support functions. The main target was to improve the implementation of global initiatives, to harmonise processes across the Group’s companies and businesses and to reduce overlapping work.
In addition to direct employment, Wärtsilä employed also indirectly an external workforce totalling 2,374 man-years in subcontracting at its factories and units. The units located in Finland had a total personnel of 3,504 employees.
|Number of employees per business|
|No. of employees||Change|
|Industrial Operations||4 091||-119|
All in all, 617 employees were reduced globally during 2011 based on the redundancy programs started in 2010. In addition, part of the expired temporary employment, voluntary leavers and retirements was not replaced. At the same time, Wärtsilä continued to recruit in the critical competence areas and acquired Cedervall with 211 employees. Wärtsilä had 17,913 employees at the end of 2011 (17,528).
People management in 2011
The main goal of Wärtsilä’s human resources strategy is to support the group strategies and to bring them alive by developing Wärtsilä's organisation and competencies to meet the business needs. The key action areas of the people strategy are further development of leadership and leadership culture in the company as well as a high-performance culture throughout the organisation by promoting true employee engagement through a culture of open communication, integrity and innovation and finally by ensuring that the businesses have the requisite resources and skilled and motivated people at their disposal. This means supporting organisational design and changes, continuous competence development and stronger performance management processes with target setting, proper feedback, evaluation of overall performance and recognition of strong performance.
Wärtsilä Human Resources continued to develop its common people management processes and tools and common ways of working across national and organisational boundaries. Wärtsilä continued to invest in technologies and tools that enable virtual collaboration and conferencing. These measures have brought clear cost savings, and more importantly, they have increased efficiency and enhanced the balance between work and home life by reducing the time needed for travelling.
The performance management process supports Wärtsilä in reaching its business targets by translating business strategies to team and individual objectives. Each Wärtsilä employee needs to know and understand Wärtsilä’s business strategy and its goals. More importantly, they need to know the targets set for their own units and the main target areas related to their own work. As part of the performance management process, each employee will have a proper performance evaluation based on their overall job performance. Overall performance evaluation will be one of the inputs for the compensation decisions following the principle of performance-based rewarding.
Learning and development
Wärtsilä continued its leadership development activities in many areas. An annual executive development programme was held in November, and six global leadership development programmes for senior managers were carried out during 2011. The number of managerial training days is also followed regularly as one of the HR KPIs.
Learning at work, self-learning, mentoring, coaching, job rotation and assignments designed to enable the competence development and the transfer of competence and skills from experienced to younger employees are integral parts of the development of learning and competence within the company. Employees are given formal classroom training at all organisational levels: from induction training for new employees to training courses for the company’s top executives. Wärtsilä employees attend a total of 54,424 training days a year, averaging 3.0 days per employee. This indicates the broad scope of this function. Many of the training programs are tailored to the specific strategic competence development needs of the businesses.
|Managers and superiors||3.4||3.2||3.9||2.7||5.3|
|Other white-collar employees||2.5||2.9||3.8||3.3||2.9|
The positive trend in development discussion compliance has continued. The global, average coverage of annual development discussions was 89%. Strategy communication started in every division in December 2011 and will continue in 2012 both in the town hall meetings, online and in the individual development discussions, in which the targets for the next year are set. Wärtsilä will conduct its sixth global employee satisfaction survey, MyVoice, in March 2012.