5% increase in global sourcing by multinationals from Irish business would lead to €500million annual boost to Irish economy
Global supply chain of multinational companies in Ireland among initiatives targeted by new Enterprise Ireland/IDA joint team
The Government is targeting the €80billion global supply chain of multinational companies in Ireland in an effort to help Irish companies win new business, grow exports and ultimately create new jobs, the Minister for Jobs, Enterprise and Innovation Richard Bruton TD announced today [Friday]. This is one of a series of initiatives driven by a new Enterprise Ireland/IDA senior management team established by Minister Bruton under the Action Plan for Jobs 2012.
Today’s announcement took place in Accenture, an IDA client company, which provides an example of the benefits that can be derived by Irish companies from engagement with multinationals. To date, Accenture has engaged with more than 17 Irish companies and a number have won new contracts from this engagement, including Daon, a leading Irish software biometric identity management company.
Multinational companies based in Ireland currently source approximately €80billion in goods and services globally, of which over €11billion currently comes from Irish businesses. The joint team is targeting an increase in this figure in 2013 through measures including:
·Identify 65 multinational companies, which offer particular potential for Irish companies;
·Develop a Joint Strategy by Enterprise Ireland and IDA to target these companies;
·Increased participation by EI clients on inward itineraries by IDA companies;
·Enhanced programmes to support EI clients capability to meet needs of global corporations;
·Additional engagements targeted with key procurement decision-makers within 65 companies.
Aside from global supply chains, the other two major areas targeted are attracting international start-ups and mentoring (see below).
Making today’s announcement, Minister Bruton said:
"A key part of the Government’s plan for jobs and growth is ensuring that we derive more benefit, as an economy, from the amazing group of world-leading multinational companies that have located operations in Ireland.
"Targeting increased links between these multinationals and our innovative Irish exporting companies can achieve two important goals: firstly, it will open major opportunities for Irish companies to secure more business and exports as part of an €80billion global supply chain; and, secondly, it will help us attract more investment from multinationals, by making the capabilities of Irish companies into a key selling point. Even a 5% increase in global sourcing by multinationals from Irish companies would lead to annual benefits of over €500million for Irish companies. I am determined to ensure that ambitious targets are set and met for this important initiative.
"In the short time that this joint team has been in existence it has made significant progress. Necessary research has been done, plans have been concluded and initial actions have been developed, with major benefits to both Irish companies and multinationals as we can see here today in Accenture. The next step now is to build on this progress with a comprehensive strategy to target growth, which is what will happen in 2013. I commend Barry, Frank and all at IDA, Enterprise Ireland and participating companies for their major work on this initiative. I am determined to ensure that in 2013 and subsequent years we will see increasing benefits for the Irish economy and in particular the jobs and growth we need".
IDA CEO Barry O’Leary said: "IDA client companies work with a range of Irish suppliers and sub-suppliers across a range of sectors. IDA Ireland is committed to acting as an intermediary to create even more of these sourcing partnerships in the future. We are confident that as Foreign Direct Investment grows in Ireland, there will be significant opportunities to increase sourcing relationships between foreign multinationals and indigenous supply companies’’
Enterprise Ireland CEO Frank Ryan said: "Enterprise Ireland would encourage more Multinational Companies as we have seen here today with Accenture, to engage with world class Irish companies and get a sense of the fantastic products and services that can add significant value to their operations both here and globally."
NOTES FOR EDITORS
1. Global supply chains:
The Global Sourcing project has been a major area of focus for the EI-IDA Senior Management team since its establishment in early 2012. In seeking to address the objectives of the Action Plan for Jobs, the Team has focused on an in-depth strategic assessment of the opportunities presented by Global Sourcing, and the development of a joint agency strategy to outline the core actions required by EI and IDA to advance this agenda.
Research was conducted by holding in-depth interviews with MNCs. This process, jointly conducted by EI and IDA, has provided strong evidence to support conclusions regarding the best supply opportunities, which will be addressed in the joint strategy document. Research has also been undertaken across EI client companies and this has highlighted the potential to enhance EI’s offer with client companies to help address capability requirements to win or sustain sales with MNCs.
Extensive third party research and interviews with leading supply chain experts has helped validate our conclusions. IDA has identified 65 operations from its circa 1,000 client companies that will be targeted in the first phase of the drive to secure additional sourcing opportunities from MNCs. Both organisations are finalising a joint strategy paper on Global Sourcing. This joint strategy paper will identify the core actions to be progressed during 2013.
2. Attracting inward entrepreneurs:
The Minister believes there is substantial benefit to be derived from enhanced cooperation between Enterprise Ireland’s activities in seeking to attract mobile international entrepreneurs to locate their businesses in Ireland, and IDA’s activities in targeting high-growth emerging businesses which have already established operations overseas but are looking to internationalise.
An initial aspect of the work undertaken by the EI-IDA Senior Management Team was to drive effective collaboration between respective teams in EI and IDA working on the inward entrepreneurs and emerging businesses agenda. This entailed:
·Developing a common understanding of both agencies’ respective target markets, and putting in place a robust mechanism to ensure that enquiries relevant to the other organisation could be passed on effectively;
·Common messaging and leveraging of marketing collateral to deliver the message overseas that Ireland is an excellent location for early stage companies;
·Sharing of pipelines and referral of potential clients between teams in the EI and IDA.
In order to maximise the impact of both agencies’ in this space, joint participation in two events overseas was progressed during 2012. The first such event was Tech Crunch Disrupt, hosted in San Francisco in September. Additionally, plans are well advanced for an EI/IDA presence at the Le Web event in Paris in December.
Plans are currently being progressed between EI and IDA teams as to the focus of marketing efforts and the potential for joint participation at impactful events during 2013.
3. Mentoring, informal adoption and peer-to-peer learning:
Accenture is an exemplar as to how a leading multinational can engage with Irish companies to develop supplier capability and to augment the product offering of the MNC to mutual advantage.
Activities to date:
The client engagement programme with Accenture is making traction for clients in international markets. To-date, over 17 EI clients have engaged with Accenture and it is expected additional companies in other sectors will be identified to engage with the process.
Some initial results:
·Daon – Accenture worked with Daon and its unique technology in biometrics to win deals in India, the US, the EU and Ireland in the border management and public safety space.
·Brite:Bill – Accenture has partnered with Brite:Bill to introduce its innovative bill and document presentation solutions to Accenture clients in postal, mobile operator and government entities globally.
·DataHug – Accenture is working with DataHug to give it access to its global network. Datahug works by using information organisations already have - communication data coming in and out of the business daily. It leverages analytics engines to show who knows who and even how well they know them.