Does Innovation goes with Social Inclusion? OEMs & Auto Suppliers in Mexico

Résumé:

By using the approach of global production networks (GPN) and of the innovation systems, we seek to get a deeper understanding of the Mexican economic evolution by examining the impact on labour of multiple automotive firms located in Mexico.
Five companies were selected (VW, Ford, Magna, Delphi & GKN) in order to attain a certain degree of diversity in regard to: position in global value chains, country-of-origin and regional location. This longitudinal study has been realized from 2003 to 2013. These companies shared a common characteristic within the Mexican context: they have proven themselves to be innovative entities. We intend to answer this main question: Does the economic and technological upgrading are accompanied with social and labor counterpart? More precisely, does innovative multinational companies have a positive impact amongst the supply chain, the ecosystems where they’re located and the human resources that work for them?
Five observation units are analyzed with the case study methodology, which is combining three analytical approaches and three different frameworks: macro (encompassing the global dimension, seen through the GPN perspective – Gereffi, et. al., 2005), meso (including both the local and regional dimension and using the innovation systems perspective – Lundvall, 2007) & micro (from a firm-level perspective, through the cognitive theory of the Company – Noteboom, 2001, and its social impact – Barrientos, et. al., 2011).
There’s been a growing part of research that shown that the balance of power between work and capital has changed significantly in the past two decades, mostly in favor of capital in developed and developing countries. Through their integrated production and distribution processes and their outsourcing agreements, multinational companies are now capable of moving their production throughout the globe, looking forward to extract the added value of the activity from different locations.
They have an active role in how globalization is managed by controlling not only the global value chain, but also by its major influence on science, technology, innovation and labor dynamics in accordance to their own interests. Even within regions with highly-regulated institutions like Germany, multinational companies are capable of re-defining the inner workings of the committees in the company, in order to adapt them to their needs (Pries, 2008). This capability in some developing countries to shape work relations in permissive institutional environments manifests itself without any restrictions (Bensusán, 2011).
There are, however, some counterpart to these trends, such as: de-globalization, limitations to the multinational companies to shape work relations, the relations with suppliers and the relations with the local innovation systems. First of all, their capability to move production from one place to another isn’t limitless. In fact, has been shown by economic geographists, the capital can be as fixed (e.g., being in one location) as the workforce (Herod, 2003; Sassen, 2008). Secondly, even when we take into account the power asymmetry between the workers and management, the former will always find a way to resist and to influence some of the decisions made by the managers (Edwards, 1986). Thirdly, the multinationals, far from their generalized image (which are powerful actors who have a tight control on their operations, who fight with others to win profitable arenas and who are characterized by a series of tensions between the competitors – Edwards & Bélanger, 2009), are composed of different actors who pursue different objectives.
In this regard, this paper analyzes the innovation process in five multinational companies located in Mexico and their relationship with employment and the labor situation in general. Our conclusions seem to lead to a diversity of situations whereas the firm and the institutional settings define the articulation between these two aspects (innovation and social inclusion).