China-USA Business Review

China-USA Business Review Volume 14, Number 8, August 2015 (Serial Number 146)

David Publishing

David Publishing Company www.davidpublisher.com

Publication Information: China-USA Business Review (ISSN 1537-1514) is published monthly in hard copy and online by David Publishing Company located at 1840 Industrial Drive, Suite 160, Libertyville, IL 60048, USA. Aims and Scope: China-USA Business Review, a monthly professional academic journal, covers all sorts of researches on Economic Research, Management Theory and Practice, Experts Forum, Macro or Micro Analysis, Economical Studies of Theory and Practice, Finance and Finance Management, Strategic Management, and Human Resource Management, and other latest findings and achievements from experts and scholars all over the world. Editorial Board Members: Kathleen G. Rust (USA) Moses N. Kiggundu (Canada) Helena Maria Baptista Alves (Portugal) Marcello Signorelli (Italy) Doaa Mohamed Salman (Egypt) Amitabh Deo Kodwani (Poland) Lorena Blasco-Arcas (Spain) Yutaka Kurihara (Japan) Shelly SHEN (China)

Salvatore Romanazzi (Italy) Saeb Farhan Al Ganideh (Jordan) GEORGE ASPRIDIS (Greece) Agnieszka Izabela Baruk (Poland) Goran Kutnjak (Croatia) Elenica Pjero (Albania) Kazuhiro TAKEYASU (Japan) Mary RÉDEI (Hungary) Bonny TU (China)

Manuscripts and correspondence are invited for publication. You can submit your papers via Web Submission, or E-mail to [email protected], [email protected]. Submission guidelines and Web Submission system are available at http://www.davidpublisher.com. Editorial Office: 1840 Industrial Drive, Suite 160, Libertyville, IL 60048, USA

E-mail: [email protected]

Copyright©2015 by David Publishing Company and individual contributors. All rights reserved. David Publishing Company holds the exclusive copyright of all the contents of this journal. In accordance with the international convention, no part of this journal may be reproduced or transmitted by any media or publishing organs (including various websites) without the written permission of the copyright holder. Otherwise, any conduct would be considered as the violation of the copyright. The contents of this journal are available for any citation, however, all the citations should be clearly indicated with the title of this journal, serial number and the name of the author. Abstracted / Indexed in: Database of EBSCO, Massachusetts, USA Ulrich’s Periodicals Directory, USA ProQuest/CSA Social Science Collection, PAIS, USA Cabell's Directory of Publishing Opportunities, USA Summon Serials Solutions, USA ProQuest Google Scholar Chinese Database of CEPS, OCLC ProQuest Asian Business and Reference Index Copernicus, Poland Qualis/Capes index, Brazil NSD/DBH, Norway Universe Digital Library S/B, ProQuest, Malaysia Chinese Scientific Journals Database, China GetCITED, Canada

CiteFactor, USA Polish Scholarly Bibliography (PBN), Poland SCRIBD (Digital Library), USA PubMed, USA Open Academic Journals Index (OAJI), Russian Electronic Journals Library (EZB), Germany Journals Impact Factor (JIF) (0.5) NewJour, USA InnoSpace, USA Publicon Science Index, USA Scholarsteer, USA Turkish Education Index, Turkey Universal Impact factor, USA BASE, Germany WorldCat, USA

Subscription Information: Print $640 Online $480 Print and Online $800 David Publishing Company, 1840 Industrial Drive, Suite 160, Libertyville, IL 60048, USA Tel: +1-323-984-7526, 323-410-1082 Fax: +1-323-984-7374, 323-908-0457 E-mail: [email protected] Digital Cooperative Company: www.bookan.com.cn

D DAVID PUBLISHING

David Publishing Company www.davidpublisher.com

China-USA Business Review Volume 14, Number 8, August 2015 (Serial Number 146)

Contents Economics European Countries Socio-Economic Development in the Context of Europe 2020 Strategy

379

Maria Klonowska-Matynia

Management Foreign Market Entry Strategies

395

Kenneth Shaw Additional Education and Training in Polish Agricultural Cooperatives

399

Małgorzata Matyja Effects of Delayed Mobilization of Resources on the Completion of Infrastructural Projects: A Case of Sondu-Miriu Hydropower Project, Kisumu County, Kenya

405

Maurice Paul Okeyo, Charles Mallans Rambo, Paul Amollo Odundo Transformations of Working Time as a Factor of Labour Dehumanization Renata Tomaszewska-Lipiec

417

China-USA Business Review, August 2015, Vol. 14, No. 8, 379-394 doi: 10.17265/1537-1514/2015.08.001

D

DAVID

PUBLISHING

European Countries Socio-Economic Development in the Context of Europe 2020 Strategy Maria Klonowska-Matynia Koszalin University of Technology, Koszalin, Poland This article discusses important and current issues of EU countries socio-economic development in the context of the “Europe 2020 Strategy” (a strategy for smart, sustainable, and inclusive growth). The main objective of this article is to prepare hierarchy and classification of the EU countries, showing the degree of core indicators implemented as described in the framework of the “Europe 2020 Strategy”. The author attempts to isolate groups of the EU countries which present similar development levels on the basis of accepted development indicators. It attempts to determine: (1) the level of socio-economic development EU countries (based on synthetic indicator); (2) trends in changing of socio-economic development level EU countries; and (3) the main factors determining the level of socio-economic development level EU countries. Based on estimated indicators, the following assumptions were verified: The development distance among EU countries has steadily decreased and the economical factors are the most strongly determining factors of sustainable development. Selected methods of multivariable objects hierarchy and classification have been used in the study. In order to measure the level of socio-economic development of the EU countries, linear ordering has been applied, based on the standardized sums method. As a result, a relative level indicator of development has been assigned to each country. The classification of the EU countries has been made mainly according to the Ward hierarchical agglomeration procedure. Thus, groups of countries appeared have been similar in terms of analyzed characteristics. It allowed an attempt to determine basic features of these countries’ groups in terms of factors determining their development. Analysis will be carried out in spatial and time dimension as a part of the research. The subject of spatial analysis will be the EU countries (including Norway and Croatia), in particular their socio-economic development indicators as described in the “Europe 2020 Strategy” framework. The time range of the study includes 2004 and 2014. Eurostat has been the main data source. Based on three pillars (social, economic, and environmental), it is concluded that the development gap among European countries has reduced, though the average level of development is slightly increasing in Europe. The catching-up process of development by the countries of Central and Eastern Europe, among which the leader is Poland, can be visibly observed. It turned out that as many as three of the five traits under examination (two of them economic pillars and one of the society pillars) are comparatively strong, this explains the value of the development index, as the environmental and educational component has proven to be of less significance. Keywords: socio-economic development, Europe 2020 Strategy, hierarchy, classification, European countries, Ward procedure Maria Klonowska-Matynia, Ph.D., Koszalin University of Technology, Koszalin, Poland. Correspondence concerning this article should be addressed to Maria Klonowska-Matynia, Ul. Kwiatkowskiego 6E, Koszalin 75-343, Poland. E-mail: [email protected].

380

EUROPEAN COUNTRIES SOCIO-ECONOMIC DEVELOPMENT

Introduction EU member states, over the years, have been trying to transform the EU economy into the most competitive knowledge-based economy in the world (Foray & Lundvall, 1996; Rodrigues, 2003; 2004; Stiglitz, 1999). The problem of defining a diverse knowledge-based economy has resulted in many papers which lead to the conclusion that it is extremely difficult to identify one universal definition (Klonowska-Matynia, 2013). Commonly used terms are: the new economy, the digital economy, the network management economy (also called the network economy) (Coyle & Quah, 2002), and the learning economy (Foray & Lundvall, 1996). The terms “knowledge-driven economy” stated by Stiglitz (1999), “the post-industrial economy” introduced by Bell (1973), and the “third wave” created by Toffler (1997), determine the service economy and tertiary civilization, which emphasize the dominance of a third sector in production and employment. The process of implementing reforms, using any combination of knowledge in Europe, was launched back in the 80’s through the implementation of the Lisbon strategy. Currently, the general priorities of building a knowledge-based economy are continuing based on the post-Lisbon agenda—the “Europe 2020 Strategy” (Klonowska-Matynia, 2013). It is emphasized that further socio-economic development of European countries (but not only) may be obtained by future generations only if coherence among the three components of development, i.e., environment, society, and economy, is maintained (Jones & Schneider, 2006). Seeking modern drivers of economic growth, Europe currently uses the concept of development, allowing it to unlock its development potential. Key factors of socio-economic development in this economic model are factors associated with the resource of knowledge, among which are included, investment in innovation and high technology, human capital, and economic cooperation between scientific and research centres (Bercovitz & Feldman, 2006; Anselin, Varga, & Acs, 1997; Antonelli, 1999; Nonaka & Takeuchi, 1995; Klonowska-Matynia, 2012). However, of all of these factors, modern scholars attribute the dominant role of human capital (Becker, 1964; Schultz, 1980; Mincer, 1962). The relationship between human capital and economic growth, among others, is described by researchers who have positively verified that an increase in the average IQ of a nation by one percentage point is associated with a permanent annual growth of 0.11% in GDP per capita (Romer, 1986; 1990; Lucas, 1988; Jones & Manuelli, 1990; Jones & Schneider, 2006). Mankiw, Romer, and Weil (1992) confirmed that the main reason for developmental differences in achievement by individual countries GDP is technology, but there is potential for countries that have “social potential” and manage to mobilize resources, such as investment, education and research, and development to catch up (Fageberg, 1994). In addition to smart growth, based on knowledge and innovation and of actions conducive to inclusive growth, this model promotes sustainable growth. This involves a movement towards a low carbon economy. This means an efficient use of natural resources, the promotion of energy efficiency, and the use of renewable sources of energy (European Commission, 2010). Securing economic growth and employment in Europe currently requires to increase the efficiency of the resources used. It is a condition of achieving progress in addressing climate change and reducing greenhouse gas emissions in the EU by 80%-95% by 2050. It is also necessary for the protection of valuable ecological resources, the functions that they perform, and the quality of life of both current, as well as future generations of people (European Commission, 2011). These priorities formed the basis for development undertaken in this article on the typology and classification of European countries on the basis of their synthetic index of socio-economic development. This is estimated on the basis of selected features describing changes in the areas


381

of environment, economy, and society, pillars of the reform program of the “Europe 2020 Strategy” (European Commission, 2011; Giovannini & Linster, 2005). This article attempts to obtain an answer to the question about the direction of changes in the level of development taking place over the years from 2004 to 2014 in European countries, as well as identifying factors which determined the levels of development achieved. In order to write this article, a decreasing gap in development among EU countries was assumed and at the same time the continuing disparities between the core countries and the periphery (countries that joined the EU after 2004). In addition, it assumes the key role of economic factors as a strong determining factor in the level of the estimated rate of socio-economic development.

Method and Scope of Data International research uses various indicators and measurements to measure and evaluate the differences in the socio-economic development of countries. The most popular, though imperfect in its design, is GDP and HDI is also used to assess development. This article is an attempt to create a synthetic index, based on the characteristics of those currently selected by the European Commission to assess the sustainable development of the EU countries included in the Europe 2020 program. The strategy takes into account three pillars in its design: economy, society, and a factor often overlooked in other comparative analyses, namely the environmental factor. In order to determine the level of development achieved by the EU in the framework of the “Europe 2020 Strategy”1, a linear ordering method based on the sum of standardized values was used. As a result of this, each of the countries is assigned a relative indicator describing to what extent the European strategy has been implemented. It involves adding up the value of standardized pre-included features, among which are negative stimulants, which are taken into account by multiplying the value by -1. A synthetic variable describing the overall level of sophistication of countries in implementing the “Europe 2020 Strategy” can be calculated by using the following formula (Nowak, 1990): Wi 

 kj 1 z ij

 

k

 max zij j 1

i

description:

zij  xij 

min

x  ij

i

and xij j are the value characteristics of the country number i. This gives an indicator of the level of development. It results in a value between 0 and 1, the bigger the value, the better it is in terms of the general criteria. The classification of countries was based on Ward’s hierarchical agglomeration procedure described by the following scheme (Nowak, 1990): (1) Each object is treated as a separate entity; (2) The distance matrix is searched for the minimum distance; (3) The closest objects are combined in one group of two elements; 1 The study involved 29 European countries and the choice of countries for analysis was conditioned by data availability. Among accepted for testing 29 European countries, Norway is not an EU member. Croatia has been a member of the EU on January 1, 2014.

382


(4) The distance between the newly created group and all other groups is determined; (5) Steps 2-5 are repeated until all the objects form one group. In Ward’s method, one of the variants of hierarchical clustering, the distance between groups of objects, is determined by the following formula (Nowak, 1990): d ir 

Ni  N p Ni  N r

d ip 

Ni  N q Ni  N r

d iq 

Ni Ni  Nr

d pq

d pq  min{d ij } i, j

where dij is Euclidean distance between classified objects; dip is the distance between one of the two groups joined on the stage of the procedure, that contains example elements and other groups (not to be joined at that stage), the number of which is Ni; diq is the distance between the other groups combined on the stage of the counting Nq elements Ni and other groups; and Nr is the number of elements in the newly formed group. To estimate the development of a synthetic indicator of the Europe 2020, the annual data reported for these areas, obtained from Eurostat, were adopted. The main objectives for this strategy are defined as:  X1 employment—the employment rate of people aged 20-64 as a %;  X2 sphere of research and development—an indicator of the size of spending on R&D described as a % of GDP;  X3 education—an indicator described as the share of persons aged 18-24 who are early school leavers as a %;  X4 poverty and social exclusion—an indicator of the proportion of people at risk of poverty or social exclusion as a %;  X5 CO2 emissions—the share of energy from renewable sources in gross final energy consumption as a %. The time component of the study included two points in time 2004 and 2014 shown in Table 1. Table 1 Output Characteristics Adopted for Testing (2004, 2014) Country

X1 Destimulant 2014 2004

Belgium Bulgaria Czech Republic Denmark Germany Estonia Ireland Greece Spain France Croatia Italy Cyprus

67.3 65.1 73.5 75.9 77.7 74.3 67 53.3 59.9 69.8 59.2 59.9 67.6

65.6 60.1 70.1 77.6 68.8 70.6 71.5 64 65.2 69.5 59.6 61.5 74.9

X2 Stimulant 2014 2004 2.28 0.65 1.91 3.06 2.85 1.74 1.58 0.8 1.24 2.23 0.81 1.26 0.48

1.86 0.49 1.2 2.48 2.5 0.85 1.23 0.55 1.06 2.16 1.05 1.09 0.37

X3 Stimulant 2014 2004



9.8 12.9 5.5 7.7 9.5 11.4 6.9 9 21.9 8.5 2.7 15 6.8

20.8 48 14.6 18.9 20.3 23.5 29.5 35.7 27.3 18.1 29.9 28.4 27.8

7.9 19 12.4 27.2 12.4 25.6 7.8 15 15.4 14.2 18 16.7 8.1

13.1 21.4 6.3 8.8 12.1 13.1 13.1 14.7 32 12.1 5.4 22.9 20.6

21.6 61.3 19.6 16.5 18.4 26.3 24.8 30.9 25 19.8 30.7 26.4 25.3

1.9 9.2 6 14.9 5.2 18.4 2.4 7.1 8.3 9.3 15.2 5.1 2.7


383

Table 1 continued Country


Latvia Lithuania Luxemburg Hungary Malta Nederland Austria Poland Portugal Romania Slovenia Slovakia Finland Sweden United Kingdom Norway

70.7 71.8 72.1 66.7 66.3 76.1 74.2 66.5 67.6 65.7 67.8 65.9 73.1 80 76.2 79.6

69.3 69 67.7 62.1 57.9 74.9 70.8 57.3 72.6 63.5 70.4 63.7 72.2 77.4 75 78.2

X2 Stimulant 2014 2004 0.6 0.95 1.16 1.41 0.85 1.98 2.81 0.87 1.36 0.39 2.59 0.83 3.31 3.3 1.63 1.66

0.42 0.75 1.63 0.88 0.51 1.93 2.24 0.56 0.74 0.39 1.39 0.51 3.45 3.58 1.67 1.57




8.5 5.9 6.1 11.4 20.4 8.6 7 5.4 17.4 18.1 4.4 6.7 9.5 6.7 11.8 11.7

35.1 30.8 19 33.5 24 15.9 18.8 25.8 27.5 40.4 20.4 19.8 16 16.4 24.8 14.1

37.1 23 3.6 9.8 3.8 4.5 32.6 11.3 25.7 23.9 21.5 9.8 36.8 52.1 5.1 65.5

14.7 10.5 12.7 12.6 42.1 14.1 9.5 5.6 39.4 22.4 4.3 6.8 10 9.2 12.1 4.7

46.3 41 16.1 32.1 20.2 16.7 17.5 45.3 27.5 45.9 18.5 32 17.2 16.9 24.8 15.8

32.8 17.3 0.9 4.4 0 1.8 22.8 7 19.3 17 16.1 6.7 29 38.7 1.2 58.6

The collected material allowed to try to assess and examine the relationship among the measured traits. For this purpose, the Pearson correlation coefficient was used (see Table 2). Studies have shown that there is a relatively strong positive correlation between the employment rate and spending on R&D (r = 0.603). An equally strong, but negative relationship exists between the threat to welfare and unemployment (r = -0.606), and R&D (r = -0.689). The use of non-conventional energy in the assessment of the level of development should be assessed as an important element. The environmental factor shows the highest correlation with the rate of employment (r = 0.405) and also demonstrates a positive relationship, but with less force occurring in relation to expenditures on R&D. A negative interdependence was observed in correlation with the number of early school leavers and the number of people at risk of poverty. All these relationships should be assessed as correct.2 The four countries with the highest level of development at the same time have the highest share of use of non-conventional energy, with Norway having twice as much as Denmark and Austria. Table 2 Correlations Between the Measured Trait 2014 Emp. Emp. R&D GasEmis. Edu. Pov.

1 0.603341 0.405058 -0.23358 -0.60612

R&D 1 0.32877 -0.24453 -0.6898

GasEmis.

1 -0.01923 -0.17088

Edu.

Pov.

1 0.299922

1

In view of this interdependence determining the strength and direction between the measured traits, the current efforts by EU governments to increase spending on R&D sector should be considered most reasonable. 2

The results show a similar correlation, but still greater interdependence in 2014 than that in 2004.

384


The first seven countries characterized by the highest rate of growth at the same time show the highest expenditure on R&D. Among the countries that spend the least on science and research is Poland. Apart from our country, Lithuania, Malta, Slovakia, Croatia, Greece, Latvia, Bulgaria, Cyprus, and Romania also spend less than 1% of GDP on these goals. It is definitely still not enough to boost innovation in these economies. Currently, the countries associated with the technological advantage are spending significantly greater than the national target for 2020, for example, in South Korea in 2010, investment was equal to 3.74% of GDP, US GDP 2.88%, Germany 2.82% of GDP, Finland 3.87% of GDP, and the United Kingdom 1.77% of GDP (Klonowska-Matynia & Sasin, 2015). Currently, Sweden, Finland, and Denmark invest the most in science and innovation (approx. 3% of GDP), as well as Austria and Slovenia (approx. 2.5% of GDP), based on Eurostat shown in Table 3. Table 3 Correlations Between the Measured Trait 2004 Emp. Emp. R&D GasEmis. Edu. Pov.

1 0.55202 0.445213 -0.25979 -0.55322

R&D 1 0.29639 -0.36209 -0.65488

GasEmis.

1 -0.25644 -0.06095

Edu.

Pov.

1 0.133726

1

Results of the Research The resulting hierarchy has enabled the countries to be grouped into five different classes, relatively homogeneous internally, in terms of the level of synthetic index of European socio-economic development for 2020. Typology results indicate that in both 2004 and 2014, they were characterized by the highest level of development of the Scandinavian countries (i.e., Sweden, Norway, and Finland) which obtained the highest index values. Bulgaria and Romania, the newest member states in the EU structure fared the worst in the evaluation, as well as Malta and the countries of Southern Europe: Spain, Greece, and Italy, who have been struggling with economic problems for several years (see Table 4). When assessing the low position of Bulgaria and Romania in the resulting typology, it should be emphasized that despite the fact that the level of development of these economies was estimated to be similar, and de facto, the lowest levels in Europe, their situation is significantly different. First of all, Bulgaria remained in the penultimate place in the standings but has improved by almost 44% compared to 2004. The relatively low position of this country could be determined by a factor associated with the social sphere. Bulgaria, despite a marked improvement, still recorded one of the highest rates of poverty risk in Europe (see Table 1). In addition, it is not without significance that there appears to be a low level of expenditure by the country in the field of research and development. It should be emphasized that both Bulgaria and Romania recorded the lowest rate of GDP percentages and in 2014 this share only amounted to 45% and 55% of the EU average respectively. In 2004, it was only 34% of the EU average, which directly affects the published information for the above purpose. In comparison, the world’s largest economies, e.g., the United States reached 150% of the EU average, and Norway 186%.3 In assessing the situation of Romania, there was a clear inhibition of the development process in the country. A causative agent of this situation could be, as in the case of Bulgaria, one of the lowest 3

Estimated value for the 28 EU countries are from Eurostat.


385

expenditures on the R&D sector in Europe and the largest risk of poverty and the accompanying failure of a high proportion of people to continue their education. Over the decade, the level of Romania’s development index decreased by as much as 14% compared to 2004, which in the case of this country, is a negative phenomenon. A different specificity is characterized by Malta. The social and economic situation of the country does not differ significantly from other countries classified in the same group, with one exception, in 2004 and in 2014, a slight increase in the share of non-conventional energy use contributed to the relatively low score against Malta compared to other countries. In this country, there was also growth in the number of people at risk of poverty (see Table 1). Ultimately, however, Malta was among the countries with the highest human development index increment (47%). Interestingly, the results for Poland showed the largest increase (almost 52%) in estimated growth rate compared to the other European countries analyzed. Certainly, the outcome of this influence was to reduce the number of people at risk of poverty by approximately 45% (it had, along with Romania and Bulgaria, one of the highest rates in 2004). There was also a significant increase in expenditure on R&D by 55% and employment by 16% (although they are still among the lowest in Europe). The improvement in living conditions was certainly a consequence of the dynamic development of Poland during this period. In addition, Poland can boast one of the lowest rates of early school leavers, which may be affected by compulsory schooling and free higher education. But here this paper is not able to talk about the simple relationship with the quality of teaching, which remains outside the monitoring strategy. In looking at the situation of countries that achieved inferior results in 2014 compared to 2004, it can be concluded that the overall restless economic situation in world markets has also had an effect. Of the 29 analyzed countries, as many as 10 recorded a lower rate of socio-economic development than in 2004. Moreover, in 10 countries, there has been a decline in employment. It should, therefore, be no surprise that at the same time, in 12 countries, the number of people living in social poverty, as a direct result of loss of income has increased. This has led to a need to reduce spending on current consumption. Analyzing the dynamics of GDP also found that most countries recorded a slowdown in economic growth which continued in 2012. It is true that this was not a single incidence. The economic slowdown was felt in global markets from 2007 onwards. In 2014, it is visible that these losses resulted in a slow down in most countries, including Greece, Cyprus, Croatia, and Italy (see Figure 1). Turning to the typology of countries affected in 2004, based on the development of the estimated synthetic index, five classes were selected: The first and second were sets of three elements with the highest and a high level of development. Dominating here are the Scandinavian countries (Sweden, Norway, and Finland) as well as Denmark, Austria, and Slovenia. The grouping actually includes similar states because of their location and standard of living, except for Slovenia, which is a relatively new member of the EU structure. Norway remains outside the EU structure. The most numerous classes—the third (nine countries) and fourth (10 countries), include countries with a medium level of development. An extreme fifth group consists of four countries characterized by the lowest level of development in the year studied, including two (Poland and Malta), who formally became members of the EU in 2004, and two more (Romania and Bulgaria) not granted membership until three years later (see Table 4). The typology of countries conducted for 2014 allowed to extract, as for 2004, the five groups of countries, different from each other, but relatively homogeneous (internally similar). Moreover, the groups of countries


386

obtained are more equal in number to those of the previous period. The order of the top 10 countries actually remains very similar to 2004, with the dominant position of the Nordic countries and Western Europe. Also, similarly, as in 2004, the fourth and fifth grade European countries are dominated by the centre-east and south, which are characterized by the lowest levels of development (see Table 4). Assessing the changes that have taken place in the level of socio-economic development in the year 2014 compared to 2004, it was observed that, in general, positive changes in the level of development took place in 19 countries (i.e., 66% of those surveyed). Less variation in the level of development of the countries surveyed in 2014 than in 2004 is also seen. The difference between the estimated indicator for the most and least developed country (Sweden and Romania) in 2014 amounted to 0.64, while in 2004 (Sweden and Bulgaria), the difference was 0.7. In addition, there is an apparent rise in the average level of the human development index in 2014 of approximately 2.7% compared to 2004. Table 4 Indicator of Socio-Economic Development Strategy Europe 2020. Hierarchy of Countries Lp.

2014

Index value

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29

Sweden Norway Finland Denmark Austria Germany Slovenia Czech Republic Netherlands France Estonia Luxembourg Belgium Lithuania United Kingdom Latvia Slovakia Poland Ireland Croatia Portugal Cyprus Hungary Italy Malta Greece Spain Bulgaria Romania

0.896904 0.807868 0.763394 0.739106 0.738139 0.662552 0.654557 0.652928 0.609418 0.595367 0.578517 0.535435 0.526604 0.51802 0.504108 0.484441 0.478149 0.467284 0.461206 0.433058 0.41691 0.415598 0.384184 0.339417 0.291713 0.273963 0.267857 0.255466 0.254039

Groupsa 1

2

3

4

5

Lp.

2004

Index value

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29

Sweden Norway Finland Denmark Austria Slovenia Netherlands Germany France Czech Republic United Kingdom Luxembourg Estonia Ireland Belgium Croatia Lithuania Latvia Cyprus Slovakia Portugal Greece Hungary Italy Spain Poland Romania Malta Bulgaria

0.88499 0.881349 0.789791 0.734996 0.685056 0.629934 0.600001 0.596985 0.59279 0.561631 0.557664 0.527686 0.526713 0.501432 0.499912 0.453243 0.45059 0.447386 0.439295 0.410853 0.394133 0.379778 0.378074 0.358159 0.357871 0.306499 0.295349 0.198762 0.177762

Notes. a Span class 0.128573, compartments of equal span; b Span class 0.141446, compartments of equal span.

Groups 1

2

3

4

5


387

Countries, classified in the first, second, and the third group in terms of the level of development achieved (except Estonia, Slovenia, and the Czech Republic), generate a higher GDP than the EU average. There are interesting cases of standards that cannot be described by the template. Some countries: Estonia, Slovenia, and the Czech Republic, which are against the background of countries of Central and Eastern Europe, are characterized by a higher level of development, while their GDP is calculated at a level lower than the EU average (72%, 83%, and 80% respectively). The attempt to establish a statistically significant dependence between the resultant level of the indicator of development and the size of GDP showed that, among the measured traits, there is a positive correlation of medium intensity (r = 0.632 in 2014; r = 0.49 in 2004). So it can be accepted that the greater the GDP a country generates (here measured as a % of the EU average for 28 countries), the higher the rate of growth is achieved (see Figure 1). 10 8

in %

6 4 2

-2 -4 -6 -8

EU (28 countries) Belgium Bulgaria Czech Republic Denmark Germany Estonia Ireland Greece Spain France Croatia Italy Cyprus Latvia Lithuania Luxembourg Hungary Malta Netherlands Austria Poland Portugal Romania Slovenia Slovakia Finland Sweden United Kingdom Norway

0

2004

2012

2014

Figure 1. GDP growth rate (%) in 2004, 2012, and 2014. Source: Own elaboration based on Eurostat.

Assessing the dynamics of changes in the level of the human development index, which occurred in 2014 in comparison with 2004, the biggest positive changes were observed in Poland, Malta, and Bulgaria. Slightly smaller, but also positive changes have taken place in Lithuania, Slovakia, and the Czech Republic (Figure 2). If this paper looks in more detail at the situation of these countries, very clear changes are observed in the evolution of the individual traits accepted for testing, and so, for example, in the case of Poland, influence on this progress was increased by the use of renewable energy (almost 61%), employment (16%), and a significant drop in poverty (almost 45%). Malta recorded an improvement, mainly in the field of education, by reducing the number of early school leavers by nearly 52%, changes have occurred in the labor market, where it increased employment by 15%, and in the use of non-conventional energy. Bulgaria recorded a change comparable to Malta. Poverty was reduced by approximately 22% and the number of people leaving early education by almost 40%. Estonia and Slovakia have invested primarily in the R&D sector (104% and 63% respectively) and in the use of non-conventional energy (by 39% and 46%) (see Table 1). In 10 countries, including the highest placed in the typology, i.e., Norway and Finland, regression was observed. The most dramatic drop in the level of development was observed mainly in Greece and Spain (28% and 25% respectively), as well as in highly developed countries in Europe, such as Ireland, Italy, and the UK.


388

The decrease in growth rate occurred even among the newest members of the EU, i.e., Croatia, Cyprus, and Romania. There has been particularly pronounced progress in Poland, Bulgaria, and Malta. These countries have improved their efficiency in the implementation of development goals, among which Poland recorded the highest progress and development. This had positive implications in moving from the fifth to the fourth group and a clear improvement in the human development index in 2014 by almost 52% (see Figure 2 and Table 4). Analyzing the growth rate of development in relative terms, i.e., in relation to the average index in 2004, a unidirectional positive rate of change of the development indicator in all countries was observed but with varying intensity. Given that the average growth rate of development in the period 2004-2014 amounted to approximately 13%, the countries were classified into four groups:  Group 1: characterised by higher than average growth rates and a higher index than the relative average level of development—United Kingdom;  Group 2: characterised by a higher than average growth rate index but lower than the relative average level of development—13 countries;  Group 3: characterised by a lower than average growth rate and higher than average level of relative development—11 countries;  Group 4: characterised by a lower than average rate of increase in rate indicator and a lower than average relative level of development—four countries (Belgium, Croatia, Cyprus, and Ireland). 35% MT

25%

20%

15%

10%

5%

The growth rate of relative development index 2004-2014

30%

RO ES PL SK GB PT

BG IT

HU GR

LV LT IE

SL

LU NE EE

HR CY

BE

SE

FR DE

N

CZ AT

DK

FI

The relative development index 2004

0% 0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

Figure 2. Changes of the relative development indicator Europe Strategy 2020. Source: Own elaboration.

2


389

In conclusion, the so-called new (referred to as peripheral) EU countries are characterized by a still lower than average level of development than the countries of the so-called core of the EU, but the rate of change is much higher. In some countries, it is more than twice the average rate in Europe. The southern countries of Europe, i.e., Portugal, Greece, and Italy, are performing similarly but the most dominant countries are Spain with a growth rate of 23% and Malta with 32%. Changes in the levels of development of countries in the so-called core countries/core EU are less dynamic, which may indicate that those countries have reached a relatively high level of development. The exception is the United Kingdom which is the only country that acquired the highest status, although the rate of growth of development at a level of 17% is not as high as it is in, for example, Malta and Poland. However, it gives rise to the recognition of these trends as very favorable. The regularity of the verified statistical test was also observed. The Pearson correlation coefficient (r = -0.7) gives rise to the acceptance of the thesis about the existence of a negative relationship between the relative level of human development index and the rate of its growth.

The Grouping of Countries Using Ward’s Method The application of Ward’s method in the above procedure allowed to make a grouping of countries which are similar in terms of their analyzed qualities, which enabled the determination of the basic properties of (these groups) countries in the context of the factors determining their sustainable development. The charts below illustrate the mutual absolute distances of individual countries or their sub-groups called bond distances and the relative distance as a percentage of the maximum distance. The classification of countries was made based on data for 2004, when the maximum distance of bonds amounted to 16.99. As a result of the application of Ward’s method, several different classifications in terms of the number of groups and the degree of their homogeneity can be obtained. Of course with a larger number of clusters, there are also shorter distances within these clusters. For 2004, by cutting the “tree branches” at the level of 3.73 (22% of maximum distance), five clusters are got, while for 2012, by cutting branches on a relatively similar level of 4.77 (24% of maximum distance) six clusters are given (Klonowska-Matynia & Sasin, 2015). In the grouping carried out for 2004 on a relatively large number of nine cluster distances, the bonds did not exceed 2.41, which was slightly more than 14% of the maximum distance. In a similar grouping for 2012, the maximum distance within the cluster totaled a little more than in that 2004, because it was less than 2.44. This was, however, a smaller percentage of the maximum distance amounting to 12.2%. As a result of this, the grouping obtained was at the same time smaller by one number of clusters. Despite the increase in the maximum distance among the clusters in 2012, some countries “drew nearer to each other”, so the eight groups could be extracted (Klonowska-Matynia & Sasin, 2015). In 2014, by cutting off the branches of the tree at a distance of bonds equal to 8.64, two groups of countries were obtained and the distinction between the core countries (countries of the old EU) and the periphery (countries adopted after 2004 together with the countries of southern Europe) is clearly visible here. A similar picture was obtained with the rest in 2004 and 2012, but that was cutting off the branches at 9.32 and 9.8 respectively. At a distance equal to five, the effects of the grouping in 2014 allow you to distinguish four groups of countries. The relatively greatest number of bonds—10, can be observed at the level of binding of 2.41 (see Figure 3).


390

Diagram drzewa Metoda Warda Odległ. euklidesowa 18 Odległość wiąz.

16 14 12 10 8 6 4 2 Belgium

Germany

Luxembourg

France

Czech Republic

Slovenia

Denmark

Netherlands

United Kingdom Ireland Denmark United Kingdom

Austria

Cyprus

Austria

Finland

Sweden Finland

Norway Sweden

Bulgaria

Romania

Lithuania Estonia

Latvia

Slovakia

Hungary Greece

Croatia

Spain

Poland

Italy

Portugal Malta

0

(a) 2004 Diagram drzewa Metoda Warda Odległ. euklidesowa 20

Odległość wiąz.

18 16 14 12 10 8 6 4

France Belgium

Luxembourg Netherlands Czech Republic Slovenia

Germany

Estonia

Norway

Romania Bulgaria

Malta Spain

Ireland Portugal Italy

Hungary

Poland Cyprus

Lithuania Latvia Slovakia

0

Croatia Greece

2

(b) 2014 Figure 3. The effects of grouping countries by Ward 2004 and 2014. Source: Own elaboration.

Mean levels of the traits studied were also presented in the figure, but in the interests of clarity and to illustrate the relationship of the average levels of the variables tested in separate groups, mean values of standardized variables were used.


391

Table 4 Classification of Countries 2004 and 2014 Group 1 2 3 4 5 6 7 8 9

Countries 2004 Portugal Malta, Italy, and Spain Poland, Croatia, Slovakia, Hungary, and Greece Latvia, Lithuania, Estonia, Romania, and Bulgaria Norway Sweden and Finland Cyprus, Netherlands, United Kingdom, and Ireland Austria, Denmark, Slovenia, and Czech Republic France, Germany, Luxembourg, and Belgium

Group 1 2 3 4 5 6 7 8 9 10

Countries 2014 Croatia and Greece Latvia and Lithuania Poland, Slovakia, Cyprus, Hungary, and Island Portugal, Malta, Italy, and Spain Romania and Bulgaria Norway Sweden, Finland, Austria, and Denmark United Kingdom, Germany, and Estonia Luxembourg, Czech Republic, and Netherlands Slovenia, France, and Belgium

6 5 4 3 2 1 0 -1 -2 -3 -4 group 1 group 2 emp

group3 group 4 D&R

group 5 group 6 group 7 group 8 group 9 gasemis

edu

poverty

(a) 2004 4 3 2 1 0 -1 -2 -3 group 1 group 2 group3 group 4 group 5 group 6 group 7 group 8 group 9 group 10 emp

D&R

gasemis

edu

poverty

(b) 2014 Figure 4. The average values of each indicator for groups of countries 2004 and 2014. Source: Own elaboration.

392


The effects of the grouping for 2014 are slightly different from 2004, both as to the size of the particular groups and the classification of the countries in each group. Generally 10 groups are obtained. These are separated into two distinctive concentrations, better than the average level of employment and share of renewable energy (group 6 and 7). Norway (group 6) constituting a single unit collection stood out among all the analyzed groups for having the highest share of renewable energy, the lowest share of people at risk of poverty, high employment, and a slightly higher than average share of people leaving early education. Group 7 (Sweden, Finland, Austria, and Denmark) is a group with a relatively favorable situation with respect to other groups. In relation to group 6, this group has a better situation in the field of education and decidedly higher expenditures in the field of research and development. Just like in the grouping in 2004, the situation in the countries of these groups was the most advantageous. The worst situation in terms of the traits studied appeared in the second (Croatia and Greece) and fifth (Romania and Bulgaria) groups. Aggravating the situation in particular, are poverty, low employment, and a lack of investment in R&D. An interesting conclusion must be based on the analysis bonds at a distance of 8.64. On this basis, two clearly differentiated groups of countries were selected in terms of the level of sustainability for both points in time. A characteristic division into two clusters of countries can be observed, “the poorer and the richer”. In the group of richer countries are the 14 countries (apart from the Czech Republic, Estonia, Slovenia, and Norway) that form the core of the EU, obtaining a GDP percentage above the EU average. The second concentration, amounting to 15 countries, is the decidedly poorer European countries, mainly including the new members of the EU and four countries (Greece, Italy, Spain, and Portugal) of southern Europe, who have been in the EU since the 1980s (and Italy since 1952), but which have been struggling with serious economic problems (mainly mounting debt and the lack of sustainability in public finances) in recent years. This clearly outlines the division of countries here based on the historical-political-geographical criterion for the countries of the former Eastern bloc countries (core and periphery), and the division between the rich North and the poor South, which also has its explanation in economic theories. The described effect was noticeable at both time points (in 2004 and 2014 and also in 2012), comparing to results of researches described in Klonowska-Matynia and Sasin’s works (2015). In an attempt to verify the strength of the factors determining the level of the synthetic indicator of growth in 2014, a regression equation was used. Two factors of comparable strength determined the index level of development. First of all employment, a feature associated with the activity in the labor market, at 66% explained the human development index level and the level of expenditure on research and development (R2 = 67%) were also selected. The number of people at risk of poverty at 62% explained the level of the human development index. Other features namely the number of early school leavers and the environmental component seem to have a weaker explanatory power (R2 = 26 respectively and R2 = 30%).4 The results indicate a slightly weaker strength shown by the key features than for 2012 and 2004, comparing to results of researches described in Klonowska-Matynia and Sasin’s works (2015). With each subsequent period, an increase in the explanatory power of the social dimension of the obtained level of socio-economic development was observed.

Conclusions The hierarchy and classification of European countries in terms of a socio-economic development 4

The attempt to assess the determinants of human development index in 2004 shows similar accuracy, with a slightly lower explanatory power of the studied traits.


393

indicator reached were carried out using several applications. Conclusions are drawn as follows: (1) Based on three pillars (social, economic, and environmental), it is concluded that the development gap among European countries has reduced, though the average level of development is slightly increasing in Europe. A study conducted in the 10-year interval, in the context of these results, confirms that the process of reducing disparities and development is a slow and long-term process. At present, strong spatial differentiation of European countries, in terms of development, continues despite the undisputed dynamic and positive changes occurring in the less developed European countries. However, the catching-up process of development is highly diversified. (2) The performed analyses allow three groups of countries (both in the resulting hierarchy and the method of grouping) to be distinguished. Nordic countries and the countries of the so-called EU core are characterized by the highest standard of living and the best economic situation. The changes taking place in these countries, however, are characterized by a relatively low growth rate, which is a characteristic of mature economies. The exception is the United Kingdom which continues with an above-average relative level of human development index, while the pace of its growth is above average. The second group of countries is the countries of the former “Eastern bloc” who joined the EU during the enlargement in 2004. They are currently in the process of catching up with their richer neighbors. Especially dynamic are the changes taking place in three of them: Poland, Bulgaria, and Malta. They are characterized by relatively high dynamics of changes, mainly in the social sphere. These changes should be assessed positively. The third group is countries which have been in the EU over the years, the countries of southern Europe (Spain, Greece, Italy, and Portugal) and Malta. The results of the statistical analysis indicate that the compositional characteristics of the economic component (mainly employment and investment in R&D) determine the level of the strongest indicator of growth. It may, therefore, be presumed that due to a decrease in labor market activity during the period, which is a result of the economic crisis, these countries’ developmental changes were poor or were not noticeable. Despite the relatively low level of human development index, high dynamic changes in the relative level of development took place in Malta and Spain, which positively distinguish these countries from the group analyzed. (3) It should be emphasized that the emerging groups are internally heterogeneous, which means that they exhibit differences in accepted characteristics in environment-economy-society for testing. They are also characterized by varying paces of change in the period analyzed (2004 and 2014) and different levels of socio-economic development of the synthetic indicator. (4) By analyzing changes in the level of development of European countries at two time points (2004 and 2014), the catching-up process of development by the countries of Central and Eastern Europe, among which the leader is Poland, can be visibly observed. (5) Among the newly admitted (after 2004) countries, the situation is most favorable in the Czech Republic, Estonia, and Slovenia, which are at a higher level of development than Poland and other countries of the former Eastern bloc. Even in countries with the lowest level of development, i.e., Bulgaria and Malta, very dynamic positive changes, primarily in the social sphere also occurred, but this does not change the fact that the level of development in these countries compared to other European countries is relatively low. (6) The attempt to identify the main features (from the areas of environment, economy, and society) which determine the synthetic indicator’s crucial level of development does not allow to identify any one particular determinant of the studied traits as critical. If as many as three of the five traits under examination (two of them economic pillars and one of the society pillars) are comparatively strong, this explains the value of the index.

394


They are indisputably linked to the factors of knowledge and human capital. As the environmental and educational component has proven to be of less significance, the value of the model’s interpretation should be considered unsatisfactory.

References Anselin, L., Varga, A., & Acs, Z. (1997). Local geographic spillovers between university research and high technology innovations. Journal of Urban Economics, 42(3), 422-448. Antonelli, C. (1999). The microdynamics of technological change. London: Routledge. Becker, G. S. (1964). Human capital. New York: Columbia University Press. Bell, D. (1973). The coming of post-industrial society: A venture in social forecasting. New York: Basic Books. Bercovitz, J., & Feldman, M. (2006). Entrepreneurial universities and technology transfer: A conceptual framework for understanding knowledge-based economic development. The Journal of Technology Transfer, 31(1), 175-188. Coyle, D., & Quah, D. (2002). Getting the measure of the new economy. London: The Work Foundation. European Commission. (2010). Europe 2020. A strategy for smart, sustainable and inclusive growth. Retrieved from http://www.mg.gov.pl European Commission. (2011). Efficient Europe resources—Flagship initiative strategy “Europe 2020”. Retrieved from http://www.eur-lex.europa.eu Fageberg, J. (1994). Technology and international differences in growth rates. Journal of Economic Literature, 32(3), 1147-1175. Foray, D., & Lundvall, B. A. (1996). The knowledge based economy: From the economics of knowledge to the learning economy (in OECD documents: Employment and growth in the knowledge-based). Giovannini, E., & Linster, M. (2005). Measuring sustainable development. Achievements and challenges. Retrieved from https://www.regjeringen.no/globalassets/upload/FIN/berekraftig/Giovannini_Linster.pdf Jones, G., & Schneider, W. J. (2006). Intelligence, human capital, and economic growth: A Bayesian averaging of classical estimates (Bace) approach. Journal of Economic Growth, 11(1), 71-93. Jones, L., & Manuelli, R. (1990). A convex model of equilibrium growth: Theory and policy implications. Journal of Political Economy, 98, 1008-1038. Klonowska-Matynia, M. (2012). The level of education vs. human capital employment. Annals of the Association of Agricultural and Agribusiness Economists, 14(6), 114-118. Klonowska-Matynia, M. (2013). Economics of European integration. Towards the knowledge economy. Selected problems. Koszalin: Publishing College Koszalin University of Technology. Klonowska-Matynia, M., & Sasin, M. (2015). The sustainable development of EU countries in the context of Europe 2020 strategy. Annual Set The Environment Protection, 17, 771-791. Lucas, R. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22(1), 3-42. Mankiw, N. G., Romer, D., & Weil, D. N. (1992). A contribution to the empirics of economic growth. Quarterly Journal of Economics, 107, 407-437. Mincer, J. (1962). On-the-job training: Costs, returns and some implications. Journal of Political Economy, 70(5), 50-79. Nonaka, I., & Takeuchi, H. (1995). The knowledge creating company. Oxford: Oxford University Press. Nowak, E. (1990). Taxonomic methods in the classification of socio-economic objects. Warsaw: PWE. Rodrigues, M. J. (2004). European policies for a knowledge economy. Cheltenham: Edward Elgar. Rodrigues, M. J. (2003). Introduction: For a European strategy at the turn of the century. In M. J. Rodrigues (Ed.), The new knowledge economy in Europe: A strategy for international competitiveness and social cohesion. Cheltenham: Edward Elgar. Romer, P. M. (1986). Increasing returns and long-run growth. Journal of Political Economy, 94, 1002-1037. Romer, P. M. (1990). Human capital and growth: Theory and evidence. Carnegie-Rochester Conference Series on Public Policy, 32(1), 251-286. Schultz, T. W. (1980). Investment in entrepreneurial ability. Scandinavian Journal of Economics, 82(4), 437-448. Stiglitz, J. (1999). Knowledge in the modern economy. Proceedings from Economics of the Knowledge Driven Economy Conference. Toffler, A. (1997). The third wave. Warszawa: PIW.


D

DAVID

PUBLISHING

Foreign Market Entry Strategies Kenneth Shaw State University of New York, Oswego, USA This paper discusses issues surrounding foreign market entry. Initially, the paper attempts to determine why and how a company makes a decision to enter a foreign market. Then there is a discussion of the timing and scale of entry which must be considered. Next is a discussion of government resources and organizations that can assist in entry decisions. Modes of entry are then examined followed by three case studies in foreign market entry. Keywords: foreign market entry, timing, scale, government resources, international business, US Export Import Bank

Introduction In recent years, foreign market entry has become increasingly popular. Entry decisions are also gaining attention from researchers of international business. Entering into a foreign market can potentially offer a firm many benefits in the global marketing area. The primary obstacle encountered by a multi-national enterprise when entering a foreign market is the selection of an entry mode. There are many decisions that need to be made when choosing to enter a foreign market. These decisions include which foreign markets to enter, when to enter them, on what scale, and the choice of entry mode. All comprehensive foreign market entry strategies offer unique benefits and costs and no two specific firm’s entry strategies and results are the same. This review will look at various cases of foreign market expansion and seek to find if there is a best entry strategy. When deciding which foreign markets to enter, the choice is based upon an analysis of a nation’s long-run profit potential. Not all nations can offer the same profit potential to a firm and the potential is based on factors such as the economic and political environment of the country. The economic attractiveness of a country is comprised of the size and demographics of the market, the present and future wealth of the country, the living standards, and potential economic growth. A country’s attractiveness can also depend on the benefits, costs, and risks associated with doing business in that country. Costs and risks involved with conducting business in a foreign country are generally lower in countries that are economically advanced and politically stable which have a free market system with little inflation or private sector debt. However, the potential for growth may be greater in an undeveloped country. Lastly, the value an international business can create in a foreign market is another important factor. This is dependent on how suitable the product offering would be to that market and the nature of competition in the country. Entry in a foreign market will be successful, if the international business can offer the market a product that is not readily available and satisfies an unmet need. That value will Kenneth Shaw, Ph.D., associate professor, Department of Management and Marketing, State University of New York at Oswego, USA. Correspondence concerning this article should be addressed to Kenneth Shaw, 312 Rich Hall Oswego, NY, 13126, USA. E-mail: [email protected].

FOREIGN MARKET ENTRY STRATEGIES

396

offer the business the opportunity to charge higher prices and rapidly increase sales. Taking all of these factors into consideration, a firm should then rank countries based on their long-run profit potential and attractiveness (Porter, 1980).

Timing and Scale After a firm has chosen an attractive market, the next decision to be made is the timing of entry. Entry is considered early, when an international business enters the market prior to other foreign firms and late when it enters after other firms have already established themselves in the market. Entering the market early brings first mover advantages that include the opportunity to establish a strong brand name, acquire demand from the market, increase sales volume, and create switching costs that attach a customer to a given product or service. However, entering the market early can bring pioneering costs that a firm that enters the market later may be able to avoid. Pioneering costs include the costs of promoting and establishing the product. The probability of a firm surviving in a market increases, if they enter after several other firms have already established the market. Government regulations can also put an early entrant at a disadvantage, because laws can hinder the value of the early entrant’s investment (Hill, 2013). The next decision that needs to be made is the scale of entry and strategic commitments. Significant assets and resources are needed for a large scale foreign market entry, which commits a firm to the market. Strategic commitments alter the competitive playing field for other firms and produce various changes and inflexibility for the firm. Large scale market entry implies rapid entry and offers the first mover advantages, such as demand acquisition, scale economies, and switching costs. An entry on a smaller scale allows the firm to build themselves up gradually while becoming better acquainted with the market and limiting exposure to the market. Small scale market entry can also make it difficult for the firm to increase market share, because of their lack of commitment to the market. The small scale entrant reduces potential risk but also misses out on the opportunity for first mover advantages (Porter, 1980). Taking all of these considerations into mind, there are not right or wrong decisions for a firm to make. Each series of decisions offers unique rewards and benefits and costs and risks. Entry strategies that are associated with high risk include entering into a developing nation and entering on a large scale. Such entry strategies offer many benefits as well. Entering on a large scale can offer first mover advantage and long-run potential in the market.

Resources There are many resources available through governments, non-governmental organizations, and multinationals which facilitate a solid framework for entering any foreign market. Most of these resources are free or have very low costs. Some examples of these resources include the United States Commercial Service, which administers market reports, local partner searches, trade missions, and support for U.S. firms interested in pursuing exporting or entering target markets. This service operates in the U.S. and 100 other foreign countries. Another example is the Overseas Private Investment Corporation, an agency of the federal government that provides political risk insurance and project financing for projects that seek direct investment by U.S. firms. The U.S. Export Import Bank is an export credit agency of the federal government that provides insurance and financing for various projects that involve direct investment by U.S. firms across various industries. The U.S. Trade Development Agency offers grants for overseas projects that involve U.S. exports.


397

The Overseas Security Advisory Council aims to help U.S. businesses better protect their foreign operations, especially in countries with unstable conditions. The American Chamber of Commerce offers advocacy and support for U.S. firms in various foreign nations. A last example is The Princeton Council on World Affairs which offers education, information, and strategic business development services for firms looking to expand in foreign markets (Gordin, 2011). Once a firm decides how they are going to enter the market, the next decision to make is what mode of entry they are going to pursue. There are six different modes of foreign entry: exporting, turn-key projects, licensing, franchising, establishing a joint venture with a host country firm, or establishing a wholly owned subsidiary in the host country. Each mode of foreign market entry offers various advantages and disadvantages (Root, 1987). In a case that examined 20 Romanian companies and their strategy of foreign market penetration, various conclusions were made. The objectives of this study were to identify a Romanian exporting company profile, to highlight the organization of marketing activities for exporting enterprises, to identify the areas of activity for exporting enterprises, to identify the main export markets of the Romanian exporters, to identify the international experience of the Romanian exporting companies, and to identify the type of strategy used for entry into foreign markets by exporting Romanian enterprises and testing the model for grouping strategies on the proposed foreign market penetration (Harangus & Duda, 2009). The main export markets of the surveyed companies were those of the European Union (EU), with over 88% of exports in 2007 being directed to markets in the EU. The most targeted foreign markets were, in order of relevance, Italy, Germany, France, Hungary, Bulgaria, Austria, and also the United States (Harangus & Duda, 2009). The results of the research concluded that approximately 60% of companies with high turnover used forms of direct export or had representation abroad. High turnover is defined by the study as having over 51 billion lei in capital (lei being the plural of leu, Romania’s currency). It was also concluded that 50% of companies with turnover less than 50 billion lei preferred cooperating with a foreign intermediary for their products to enter the foreign markets. This study also concluded that the most common strategy of foreign market entry for Romanian exporters in the developed markets of the EU or the U.S. was direct exporting, while the emerging markets of Central and Eastern Europe or Asia used the more cautious approach of a local intermediary in most cases. Another case looked at Tesco, the largest grocery store chain in the United Kingdom that owns a 25% share of the British market. By the early 1990s, their business was already booming and the company was generating a large amount of free cash flow. Senior management had to decide what to do with the excess money they were earning and one strategy they agreed upon was foreign expansion. They decided that they were interested in entering emerging markets in Eastern Europe or Asia. These emerging markets offered them one limited competitor and strong potential for growth. Their first endeavor was into a state-owned grocery chain with 43 locations in Hungary in 1994, when Tesco acquired a 14% market share. Then in 1995 they acquired 31 stores in Poland. In 1996, they acquired 13 more stores in the Czech Republic and Slovakia (Hill, 2013). Tesco began expanding into Asia in 1998 in Thailand, when they purchased 75% of Lotus, a local food retailer. Then they expanded into South Korea in 1999, when they partnered with Samsung. They then entered into Taiwan in 2000, Malaysia in 2002, and China in 2004. They were initially attracted to the Chinese market because of its large size and rapid growth. They ultimately settled on a 50-50 joint venture with Hymall, a hypermarket chain. In 2007, Tesco entered the U.S. grocery market. By 2010, they had generated over 19


398

billion euros outside the United Kingdom. They believe that their success was based upon devoting a large amount of attention to transferring its core capabilities in retailing to the new acquisitions instead of sending expatriates, their partnering strategy with Asia, and their focus on markets with good growth potential (Hill, 2013). Another case involves the 2004 strategic alliance of Cisco Systems and Fujitsu, a Japanese computer, electronics and telecommunications equipment company. By entering into this alliance with Fujitsu, Cisco believes that it can accomplish a number of different goals. First, both firms are pooling their research and development efforts that enable them to share technology and produce new products more easily. Second, by combining Cisco’s cutting edge technology and Fujitsu production skills, they believe that they will be able to offer more reliable products for consumers. Third, Fujitsu will provide Cisco with a more prominent sales presence in the Japanese market. Fourth, sales may also increase by the bundling of the co-branded routers together with other telecommunication that Fujitsu offers and creating a marketing plan that provides a comprehensive solution to consumers. The alliance began offering their first products in May of 2006. Both firms benefit from the alliance.

Conclusions As can be seen from the various cases and examples of foreign market entry, there is no right or wrong way of entering a market. Each case is unique and requires a special strategy that is completely different from any other. There is also no entry strategy that is superior to others. Each different strategy can be successful if the firm takes the time before hand to extensively research the attractiveness of possible countries, their political and economic environment, their potential for long-term growth, and the benefits and costs associated with entering any given market.

References Gordin, A. (2011). Destination unknown, opportunity certain. Industry Week, 260(2), 52-54. Harangus, D., & Duda, D. D. (2009). The strategies of foreign market’s penetration used by Romanian enterprises from Western five region. Proceedings from Annals of Danube Adria Association for Automation and Manufacturing (DAAAM). Hill, C. W. I. (2013). International business: Competing in the global marketplace. New York: McGraw-Hill Irwin. Porter, M. E. (1980). Competitive strategy: Techniques for analyzing industries and competitors. New York: Free Press. Root, F. (1987). Entry strategies for international markets. Lanham: Lexington Books.


D

DAVID

PUBLISHING

Additional Education and Training in Polish Agricultural Cooperatives Małgorzata Matyja Wrocław University of Economics, Wrocław, Poland Environmental conditions require, from companies and their employees, continuous learning and acquiring new knowledge, skills, and competences, which generally may be named as shaping the human capital. The same refers to agricultural cooperatives and more specifically their members and employees. The article describes the usage of one of cooperative principles, concerning education, training, and information, in Polish agricultural cooperatives. The purpose of the article is to describe the educational needs of members and employees of agricultural cooperatives. The article brings the answers for the following questions: What is the interest of additional education and professional development in Polish agricultural cooperatives? What are the areas of interest of education? What forms of education are appropriate? Who most needs education? The article utilizes the results of research conducted in 2013. The research method was a survey sent electronically to the managers of 1,147 cooperatives. Approximately 50 respondents took part in the research. Data analysis included the method of logical inference. The findings are disturbing. It turns out that the level of educational needs in Polish agricultural cooperatives is small. The reasons for this are most often the lack of funds, the lack of faith in ensuring tangible effects of training, and the general members’ antipathy to make efforts to improve the knowledge and skills which results from their age close to retirement. The main conclusion is that this might have its source in the wider context of changes in Poland in general and associating Polish agricultural cooperatives with the forced collectivization of agriculture that is still observed, even by the cooperatives members themselves. Keywords: agricultural cooperatives, cooperative members, human capital, educational needs, additional education, professional development

Introduction Education is a basic human right and a significant factor in the development of children, communities, and countries. Across the developed world, everybody agrees about the importance of education (Wilkinson & Pickett, 2009). It positively influences on society, which needs the contributions and economic productivity of a skilled workforce and simultaneously it is good for individuals. The local and regional socio-economic development nowadays is indispensably connected with the improvement of human knowledge and skills both in individual and collective dimensions. This can be viewed as human capital shaping. In the era of building knowledge-based economy, the human need of learning takes on the special significance. It turns out that completing the education at school level becomes insufficient to Małgorzata Matyja, Ph.D., Wrocław University of Economics, Wrocław, Poland. Correspondence concerning this article should be addressed to Małgorzata Matyja, Wrocław University of Economics, Komandorska Street 118/120, 53-345 Wrocław, Poland. E-mail: [email protected].

400

ADDITIONAL EDUCATION AND TRAINING IN POLISH AGRICULTURAL COOPERATIVES

function in today’s world, especially in business conditions. Therefore, a man should participate in the vocational education and training also at the stage of adult life. This fact refers also and maybe especially to members of agricultural cooperatives. One of several cooperative principles concerns education, training, and information (Oczkowski, Krivokapic-Skoko, & Plummer, 2013). This means, more or less, that cooperatives should provide education and training for their members, elected representatives, managers, and employees. The article somehow describes the usage of the mentioned cooperative principle in practice of Polish agricultural cooperatives. Precisely, the purpose of this article is to describe the educational needs of members and employees of agricultural cooperatives in Poland. This issue seems to have the particular importance for the Polish cooperatives. They still suffer from the negative perception of the environment as a relic of the previous political system and often face a number of internal problems (Dzun, 2009; Chloupková, 2002). Maybe a bit of additional education and concern about professional development would help them to adapt to the changing world.

Literature Review The importance of agricultural extension and education seems to be essential (Solouki, Allahyari, & Bordbar, 2011). With little or no access to education, the members are lacking the ability to participate meaningfully in cooperatives (Münkner, 2012). Education of cooperative members is essential to effective communications both internal and external to the co-op (Williamson, 1998). It refers to all areas of cooperatives activity, for example, Birchall (1997) claimed that one of the factors contributing to an enduring agricultural sector in America was the development of extension programmes by agricultural universities, some of which were to set up specialised co-operative education and training centres. In the same study, he also indicated three distinct phases in the history of cooperative education: firstly, providing basic literacy and technical education to members; secondly, in the environment of widespread state education—educating members about cooperative principles with formal qualifications through cooperative colleges; and lastly, providing less formal education and using new approaches. He specified that the third phase includes the following features:  making sure that the right people are trained;  providing training locally rather than in colleges abroad;  making courses relevant to the problems of local cooperatives;  linking training to the work situation;  active participation by students;  networking with participants after training has ended;  promoting sustainability by building the capacity of local training agencies;  educating the general public about cooperatives. Robb (2011) identified the importance of participating in on-going education for and about cooperatives and determined the diversity of needs of people within and outside cooperatives. He warned about the consequences of trivializing the role of education in cooperatives, quoting Schildgen (1989) as saying that in case after case, when a coop has gone under, observers have cited the decline of cooperative education as a major factor in the failure. In the context of such important role of education in cooperatives, this study describes the approach to this issue on the example of Polish agricultural cooperatives.


401

Research Methods In Poland, agricultural cooperatives perform the functions of production, service, and processing related to agriculture. This includes mainly supply and sales co-operatives, dairy co-operatives, gardening and apicultural co-operatives, co-operatives of agricultural organizations, and agricultural production co-operatives, which are described in Table 1. Table 1 Basic Statistical Data on Polish Agricultural Cooperatives (Outstanding at 2011) Number of active Estimated number Estimated number co-operatives of members of workers

Type of cooperative

Field of activity

Supply and sales cooperatives “Samopomoc Chłopska”

Trade, services for agriculture, food 1,259 processing, and production Purchase of agricultural raw materials and food production 156 (milk and milk products) Food production 73 (fruits, vegetables, and honey)

Dairy cooperatives Gardening and apicultural cooperatives Cooperatives of agricultural organizations Agricultural production cooperatives Cooperative agricultural producers group Total

Services for agriculture Agricultural production (crops and livestock farming) Agricultural production (crops and livestock farming)

200,000

85,000

150,000

18,000

10,000

2,000

570

na

10,000

734

42,000*

8,000*

192

na

na

2,984

-

-

Notes. * means data in 2013; na means data non available. Source: Boguta (2011) and National Council of Cooperatives (2013).

The empirical research on the educational needs of agricultural cooperatives was conducted in 2013 using a questionnaire, which was sent electronically to the managers of 1,147 cooperatives. They were asked to give the response to a set of 17 closed questions. Only 48 respondents filled out the questionnaire, which means that the total rate of responses’ return is approximately 4%. Most of the surveys were filled out by representatives of agricultural production cooperatives. Ten percent of these enterprises took part in the survey.

Research Results The respondents’ answer to the basic question of the interest of additional education and professional development in Polish agricultural cooperatives might sound a bit surprising (Table 2, issue 1). It turns out that almost 70% of cooperative members are not interested at all or have only little interest in additional education and professional development. Only 2% admitted that this interest was strong. Thus, in general, the educational needs seem to have no significance in agricultural cooperatives. The next question that arises is about the reasons for this phenomenon. The answers are shown in Table 3. Members of agricultural cooperatives are at the most the elderly people who claim that they do not need to learn anymore and simply want to wait for the upcoming retirement. This was said by 21% of respondents. Not much less, it means that exactly 20% admitted that they did not believe in real tangible results of training or studies, which in this context they treat like a waste of time. The barriers in further education for the 17% of respondents are also the lack of funds and time. People of 13% see themselves as someone who know and can do everything in their work, so they do not need additional education. People of 11% complain about the lack of appropriate training offer and 2% are afraid to return to “school”. No other reasons were indicated.

402


Table 2 The Research Results on Basic Issues Concerning Educational Needs in Polish Agricultural Cooperatives

Issue

None Little Average Strong Very strong

1 2 The cooperative members’ interest of The respondents’ possibilities and additional education and professional willingness to send their subordinates development to studies Percentage of responses 25% 60% 44% 17% 29% 13% 2% 10% 0% 0%

3 The respondents’ possibilities and willingness to send their subordinates to training or courses 13% 35% 28% 22% 2%

Table 3 The Reasons of Very Little Interest of Additional Education and Professional Development in Cooperatives Reason No. of responses Attitude of members expressed in the statement: “I do not need it, I calmly wait for retirement” 20 Lack of faith that additional training or studies can bring tangible results 19 Lack of funds 16 Lack of time 16 Attitude of members expressed in the statement: “I do not need it, I know and can do everything” 12 Lack of appropriate training offer 10 Lack of confidence, fear of return into “school benches” 2

Percentage 21% 20% 17% 17% 13% 11% 2%

The cooperative managers were also asked what such training offer should include. Table 4 presents which type of trainings would and would not meet with cooperative’s educational needs. Opinions were divided. People of 40% claim that there is no or very little demand for specialist courses (such as cultivation of plants, zootechnics, or the use of agricultural vehicles), whilst 33% see this demand as very strong or strong. People of 46% would rather not go to the training about financial support instruments for agriculture, but 33% would rather choose this. People of 44% would like to learn how to obtain EU funds, but 33% are not interested in this subject. What can certainly be said is that the majority of respondents do not need trainings on agrotourism and rural tourism (91% of responses), the creation of producer groups (78% of responses), and ecological agriculture (74% of responses). The respondents also indicated in which form such education should be organized (Table 5). They claim that for the cooperatives members, it should be mainly trainings or courses in or outside the workplace. They are definitely not interested in e-learning forms or studies at the university. The responses for the second issue in Table 2 also confirmed these conclusions. People of 77% (in total) of cooperatives managers do not want or have the possibility to send their subordinates (members and employees) to studies. Only 10% declare their willingness to enable their subordinates to use this educational opportunity. However, the managers’ willingness to send employees to different trainings or courses is higher. This is presented also in Table 2 (issue 3). Almost one fourth want their subordinates to take the advantage of this form of education. Approximately half (48% in total) do not see such need. The group in agricultural cooperatives which needs additional education and professional development the most is managerial staff. In total, 73% of respondents very strongly, strongly, or on average recommend


403

trainings for this group. Approximately a half claimed that further education would be useful also for administrative staff and for workers. The vast majority do not see the educational need for the candidates for the member of the cooperative. These research results are shown in Table 6. Table 4 The Degree of the Demand for Different Types of Trainings for Cooperative Members Type of training Specialist courses Accounting and taxes Management of cooperative Entrepreneurial Creation of producer groups Financial support instruments for agriculture Obtaining EU funds Ecological agriculture Modern technologies of agricultural production Agritourism and rural tourism

None 13% 26% 26% 35% 48% 23% 13% 50% 30% 76%

Little 27% 28% 28% 17% 30% 23% 21% 24% 13% 16%

Average 27% 21% 21% 26% 15% 21% 23% 17% 26% 4%

Strong 27% 19% 19% 20% 4% 27% 33% 9% 20% 4%

Very strong 6% 6% 6% 2% 2% 6% 10% 0% 11% 0%

Table 5 The Degree of the Demand for Different Forms of Trainings for Cooperative Members Form of training Training and courses in the workplace Training and courses outside the workplace E-learning training and courses Postgraduate studies at the university

None 13% 20% 69% 71%

Little 26% 37% 18% 18%

Average 45% 30% 7% 11%

Strong 15% 11% 7% 0%

Very strong 2% 2% 0% 0%

Table 6 The Degree of the Demand for Additional Education According to Different Groups in Cooperatives Group Managerial staff Workers Administrative staff Candidates for members of the cooperative

None 4% 15% 15% 66%

Little 23% 36% 36% 19%

Average 46% 32% 32% 9%

Strong 23% 17% 17% 6%

Very strong 4% 0% 0% 0%

Discussion Summing up, the educational needs in cooperatives are not in the high level. This might have its source in the wider context of changes in Poland in general. After the Second World War, the communist system determined the political, economic, and social life of the whole country for a long time. The agricultural cooperatives, initially organized spontaneously, mainly by former employees of the manor and the farmers themselves (Bajan, 1988), become a tool in the hands of contemporary authorities to achieve its political, economic, and social objectives. A serious blow to the agricultural cooperatives was caused by the political transformation in Poland in the early 1990s (Matyja, 2012). Now, after 25 years of transformation, structural change in agriculture is slowing down, as a result of EU Common Agricultural and National Policies (Kozak, 2014). The agrarian structure is dominated by subsistence farms with the average farm size below 10 hectares. As a result, rural areas are still in need of deep restructuring and the modernization of economic structures. But individual farmers do not rather

404


want to act together in cooperative form. Unfortunately, agricultural cooperatives are still associated with the forced collectivization of agriculture and therefore perceived as a product of the previous system (Dzun, 2009), even by the cooperatives members themselves. It seems to be one of the main problems faced by cooperatives in rural areas. The next ones, such as unwillingness to realize educational needs, may be a consequence of it.

Conclusions The findings shown in this article are disturbing. It turns out that the level of interest and demand for courses and training in Polish agricultural cooperatives is small. The reasons for this is most often the lack of funds, the lack of faith in ensuring tangible effects of training and the general members’ antipathy to make efforts to improve the knowledge and skills which results from their age close to retirement. The next author’s research (not mentioned in this article) at the same sample showed that the cooperative members are optimistic about the future of their cooperatives and do not complain about the achieved earnings. In the context of the requirements, a knowledge-based economy on one hand and the lack of interest in improving knowledge and skills in cooperatives on the other, this optimism, unfortunately, seems to be unfounded.

References Bajan, K. (1988). Some problems of agricultural productive cooperativeness. Proceedings from the Scientific Conference of Institute of Agricultural and Food Economics and Central Association of Agricultural Productive Cooperatives. Birchall, J. (1997). The international co-operative movement. Manchester: Manchester University Press. Boguta, W. (2011). Rural cooperatives as one of the main forms of joint economic activities of people. Warsaw: National Council of Cooperatives. Chloupková, J. (2002). European cooperative movement—Background and common denominators (Unit of Economic Working Papers, The Royal Veterinary and Agricultural University, Copenhagen, Denmark). Dzun, W. (2009). Co-operatives of agricultural production in the process of systemic change. Agricultural Economics Issues, 4, 74-87. Kozak, M. W. (2014). The transformation of Polish rural areas since 1989. Wieś i Rolnictwo, 1, 155. Matyja, M. (2012). Economic and social importance of agricultural productive cooperatives in Poland. Journal of Agribusiness and Rural Development, 4(26), 60-61. Münkner, H. H. (2012). Co-operation as a remedy in times of crisis. Agricultural co-operatives in the world. Their roles for rural development and poverty reduction. Marburg Studies on Cooperation and Cooperatives, 58, 26. National Council of Cooperatives. (2013). Data on agricultural production cooperatives. Retrieved from http://www.krs.org.pl/index.php?option=com_content&view=article&id=30&Itemid=286 Oczkowski, E., Krivokapic-Skoko, B., & Plummer, K. (2013). The meaning, importance and practice of the co-operative principles: Qualitative evidence from the Australian co-operative sector. Journal of Co-operative Organization and Management, 1, 54. Robb, A. J. (2011). Cooperative education. Halifax: Saint Mary’s University. Schildgen, B. (1989). Co-op education is about co-operatives. Retrieved from http://www.cooperativegrocer.coop/articles/index.php?id=65 Solouki, M., Allahyari, M. S., & Bordbar, M. (2011). Analysis of effective factors to increase the knowledge of agricultural production cooperative members in Semnan Province, Iran. African Journal of Agricultural Research, 6(32), 6648. Wilkinson, R., & Pickett, K. (2009). The spirit level. Why equality is better for everyone. London: Penguin. Williamson, L. (1998). Cooperative education and communication. Lexington: University of Kentucky College of Agriculture.


D

DAVID

PUBLISHING

Effects of Delayed Mobilization of Resources on the Completion of Infrastructural Projects: A Case of Sondu-Miriu Hydropower Project, Kisumu County, Kenya Maurice Paul Okeyo, Charles Mallans Rambo, Paul Amollo Odundo University of Nairobi, Nairobi, Kenya The study examined the effects of delayed mobilization of resources on the completion of Sondu-Miriu Hydropower Project (SMHP) in Kisumu County, Kenya. The project’s completion was scheduled for end of 2005, but was later revised to 2011 due to delay, which periodical reports are associated with delayed mobilization of resources, among other challenges. Causes of project delays have attracted relatively more studies than the effects of such delays. The study addressed two research questions: What is the relative importance of mobilization of resources among other components of contractual delays? What is the perceived effect of delayed mobilization of resources on the project’s completion? A causal-comparative design was adopted and primary data sourced in May 2011 from 39 senior management staff of contractual parties. Relative Importance Index (RII) was used to determine the relative importance of perceived effects of delayed mobilization of resources on the project’s completion; while Kendell’s coefficient of concordance was applied to determine the degree of agreement among participants regarding perceived effects of delays. The study found that delayed mobilization of resources led to re-scheduling and re-sequencing of activities (92.3%), loss of productivity and efficiency (82.1%), increase in time-related costs (79.5%), prevention of early completion (76.9%), as well as extension of time and acceleration of works (74.4%). Based on the results, the study concluded that it is important for stakeholders to develop and share resource mobilization plans, which should ensure timely availability of equipment and human resource. However, having comprehensive plans is not sufficient, if funds are not released to contractors in time. The study recommends the need for comprehensive resource mobilization plans; timely payment of contractors, in accordance with contractual schedules, to facilitate resource mobilization plans; as well as citizen participation to influence the flow of resources at higher levels of government as well as ensure accountability at the project level. Keywords: infrastructural projects, resource mobilization, equipment, human labor, time overruns, budget overruns

 Acknowledgement: Special thanks go to the University of Nairobi for granting opportunity to the first author to pursue his Master of Arts Degree Project Planning and Management. Secondly, all the participants who took their time to provide the requisite information are thanked. Thirdly, the support provided by Tom Odhiambo in reviewing the manuscript is acknowledged.  Maurice Paul Okeyo, M.A., project planning and management, University of Nairobi, Nairobi, Kenya. Charles Mallans Rambo, Ph.D., extra mural studies, University of Nairobi, Nairobi, Kenya. Paul Amollo Odundo, Ph.D., education administration, University of Nairobi, Nairobi, Kenya. Correspondence concerning this article should be addressed to Charles Mallans Rambo, P.O. Box 30197-00100, Nairobi, Kenya. Tel. +254 020 318 262; Mobile: +254 0721 276 663 or + 254 0733 711 255. E-mail: [email protected]; [email protected].

406

A CASE OF SONDU-MIRIU HYDROPOWER PROJECT, KISUMU COUNTY, KENYA

Introduction Sondu-Miriu Hydropower Project (SMHP) was initiated by Kenya Electricity Generating Company Limited (KenGen) to inject an additional 80 Mega Watts of electricity into the national grid. The project which is located in Kisumu County, was financed by the Government of Japan through Japanese International Corporation Agency (JICA), under the Overseas Development Agency (ODA) loans at a cost of KES 18 billion (JICA, 1985). The project’s construction began in 1999 and was scheduled to end in 2005, covering a number of facilities, including a headrace pressure tunnel, a surge tank, access roads, schools, a base camp, a penstock line, a power station, and an outlet channel. Additional facilities included hydro-mechanical works, generating equipment, transmission line, and substations (Nippon Koei, 2008). Due to various circumstances, the project’s completion date was revised from December 2005 to November 2011. Among the factors that contributed to revision of the project’s completion date was delay in the mobilization of resources, including equipment and human labor (Nippon Koei, 2008; Abiero, 2010). As noted by Assaf and Al-Hejji (2006), mobilization of resources in large infrastructural projects is often the obligation of contractors and one of the key preliminary steps in ensuring that such projects are successful by being delivered within scheduled duration, allocated budget, and specified quality (Majid, 2006). Paradoxically, delayed mobilization of resources is often a critical challenge to infrastructural projects world over, leading to increased construction costs, due to time extension, acceleration of works, as well as loss of productivity; disruption of work, loss of revenue through lawsuits, as well as project abandonment (Sambasivan & Soon, 2007; Owolabi et al., 2014). According to Melton and Vann (2013), mobilization of resources consists of preparatory work and operations necessary for the movement of equipment and personnel, supplies, and incidentals to project site before onset of works. Whereas some contractors purchase equipment, others rent them from dealers or individuals (Melton & Vann, 2013). However, in many developing economies, it is challenging for contractors to own all necessary equipment for the construction of large infrastructural facilities. More specifically, the cost of purchasing and maintaining excavators, track hoes, trucks, scaffolds, compactors, and other large equipment is prohibitive for many contractors, thus, renting from dealers or leasing companies is an easier option (Melton & Vann, 2013). Furthermore, human labor is an important factor in construction projects. Mobilization of human labor entails identification of adequate skilled and unskilled workers to operate equipment and provide manual labor (Raj & Kothai, 2014). The duration taken by contractors to mobilize equipment and human labor is a key indicator of successful completion of infrastructural projects within specified timeframes, budgets, and quality specifications. Delay is a common challenge experienced in the construction of infrastructural projects in developed and developing countries alike (Sambasivan & Soon, 2007; Alaghbari, Kadir, Salim, & Ernawati, 2007; Aziz, 2013). Whereas causes of delays in the construction of infrastructural projects have attracted many studies, particularly in developing economies (Sambasivan & Soon, 2007; Aziz, 2013; Owolabi et al., 2014); the effects of such delays have not received as much attention. In Kenya, a few studies, such as Talukhaba (1999), Abiero (2010), as well as Ondari and Gekara (2013), assessed various factors causing delay in the completion of infrastructural facilities; however, none focused on the effects of delayed mobilization of resources on the completion of such facilities. This study examined the effects of delayed mobilization of resources on the completion of SMHP project. Unlike its predecessors, the study aggregated perspectives of the project’s key stakeholders, including KenGen (the employer), Nippon


407

Koei Company Limited (the engineer), Sinohydro (the contractor), and JICA (the financier), to determine the relative importance of delayed mobilization of resources in the timely completion of SMHP project. The study further applied a coefficient of concordance to determine the degree of agreement among the four categories of participants with respect to their ranking. The purpose of the study was to inform stakeholders of large infrastructural projects about the potential negative effects of delayed mobilization of resources on the successful completion of such projects, within planned time, budget, and quality standards. The findings of this study are therefore, likely to influence the planning and execution of large infrastructural projects in various contexts. However, the findings are particularly relevant for stakeholders in resource-poor contexts, where loss of public resources through project delays is likely to have significant ripples-effect across all sectors of the economy.

Literature Review A review of existing literature reveals that delay in the completion of infrastructural projects is a global phenomenon, affecting both developed and developing countries (Sambasivan & Soon, 2007; Alaghbari et al., 2007; Aziz, 2013). For instance, in developed countries, De Souza (2009) linked delays in the completion of infrastructural projects in Canada with various factors, including reduced funding by sponsors, communication breakdown, delayed disbursement of funds, poor site management by contractors, and tedious legislative procedures. In the United States, SNL Financial (2010) reported delay in the completion of a pipeline project connecting Florida State and Bahamas, particularly due to design changes; while Baldwin and Manthei (1971) associated project delays in the United States with weather vagaries, low labor supply, and poor management of sub-contractors. Delays in the completion of infrastructural projects have also been reported in countries such as Australia and Britain, among others (Bromilow, 1974; Sambasivan & Soon, 2007; Aziz, 2013). In developing countries, delays in the completion of infrastructural projects have been reported in India, Malaysia, Indonesia, Qatar, Jordan, Egypt, Ghana, South Africa, and Kenya, among other countries. For instance, in India, a government Infrastructure Delay Report of 2006 reported delays in the completion of a rail project in West Bengal and a coal project for about three and two decades, respectively, which were attributed to slow design processes and late disbursement of project funds (Government of India, 2006). In Qatar, a Public Works Report of 2009 linked delays in the completion of about one-third of infrastructural projects to contractors’ lack of capacity, escalation of construction material prices, prolonged transfer of land ownership rights to contractors, deferral of payments due to design issues, as well as legislative challenges in the procurement of necessary equipment and machinery from overseas market (Government of Qatar, 2009). In Malaysia, Sambasivan and Soon (2007) identified causes of delays in the completion of infrastructural projects, including contractor’s improper planning, poor site management, inadequate experience, inconsistent flow of payments for completed works, poor management of sub-contractors, inconsistent communication between parties, shortage of materials, as well as delay in the mobilization of resources, such as equipment and labor. In South Africa, a government report linked infrastructural project delays with changes in project design, inconsistent flow of financial resources, and contractor’s lack of capacity to deliver (Government of South Africa, 1999); while in Ghana, delay in payments, poor contractor management, delays in material procurement, poor technical performances, and escalation of material prices were identified as key factors

408


accounting for about 80% of delays in the completion of infrastructural projects (Frimpong, Olowoye, & Crawford, 2003). In Kenya, delays in the completion of infrastructural facilities have been associated with factors, such as poor financial management by clients, inadequate designs, and poor management of the construction process by contractors (Talukhaba, 1999). Arguably, these factors are compounded by secondary issues, such as poor management of materials and equipment by contractors, inadequate recognition and response to risks emanating from the physical and socio-economic environments, as well as inadequate regard for stakeholders’ needs (Talukhaba, 1999). Another study conducted by Ondari and Gekara (2013), which focused on factors influencing completion of road projects in Kenya, reported significant correlation between project delays and factors, such as management support (r = 0.625), design specifications (r = 0.836), contractor’s capacity (r = 0.567), and supervision capacity (r = 0.712). Delays in the completion of infrastructural facilities were also identified by Abiero (2010), who reported that such delays led to loss of both time and possession utility of the projects. Some of the cases cited in the report included the Kisii-Chemosite Road which delayed for more than 15 years as well as the Nyanza Provincial Headquarters which stalled for more than two decades (Abiero, 2010). Existing literature revealed that a lot of studies conducted in various contexts were skewed towards causes of delays in the completion of infrastructural facilities; few identified delayed mobilization of resources as one of the causes of delay in the completion of infrastructural projects. Similarly, very few studies examined the effects of delays in the mobilization of resources on the completion of such projects.

Research Methods The study adopted a causal-comparative design which permitted the application of quantitative approaches in data collection, processing, and analysis. Causal-comparative designs employ natural selection principles, rather than manipulation of dependent variables to establish relationships with independent variables (Oso & Onen, 2005). Self-administered questionnaires were issued to senior management staff of contracting parties, including KenGen (the employer), Nippon Koei Company Limited (the engineer), Sinohydro (the contractor), and JICA (the financier), to source the requisite information. Primary data were supplemented with secondary data, which was sourced from the project’s archives. Senior management staff members were targeted, because contractual issues formed part of their responsibility. A sampling frame of all senior management staff was prepared using organizational management charts and the process identified 54 eligible participants, who were all included in the sample to avoid the risk of sampling error (Table 1). Table 1 Sampling Frame Contracting partner type Employer Contractor Engineer Financier Total

Frequency 15 20 15 4 54

Percent 27.8 37.0 27.8 7.4 100.0

Self-administered questionnaires were used to source the information, because they provided the flexibility that targeted participants would require, considering their complicated itineraries. The approach


409

enabled participants to provide the requisite data at their convenience. One module of the instrument was applied across the board to permit comparison of perspectives from different contracting parties. The instrument, which had both closed- and open-ended questions, captured information on contractual delay typology, perceived causes and effects as well as mitigative measures. The instrument was pre-tested at the Kisumu Airport Expansion Project, which had a similar contractual management structure. The pre-testing was important for testing reliability of the instrument and validity and feasibility of data collection approaches. Primary data were collected in May 2011 after obtaining necessary approval from University of Nairobi, National Council of Science and Technology, as well as KenGen. Questionnaires were delivered to targeted participants and follow-ups were made through e-mails and telephone calls. Of the 54 targeted participants, 39 (72%) successfully completed and returned the questionnaires. Table 2 shows the questionnaire return rate for each category of participants. Table 2 Questionnaire Return Rate Contracting partner type Employer Contractor Engineer Financier Total

No. targeted 15 20 15 4 54

No. of participants 14 12 10 3 39

Return rate (%) 93.3 60.0 66.7 75.0 72.2

Primary data were listed, coded, digitalized, and cleaned for logical inconsistencies and misplaced codes. The methods used included descriptive, factorial comparative, and rank analyses, to develop relative importance of causes and effects of contractual delay on the project’s completion. Relative Importance Index (RII) was computed using the formula (Kometa, Oloimolaiye, & Harris, 1994). RII

(1)



where W is the weighting assigned to each response on a scale of 1 to 5 corresponding with lowest to highest; A is the highest weight; and N is the total number of participants. RII yielded values in the range of 0 < x ≤ 1. The higher the value of RII, the more important the identified factor on contractual delays. This ranking enabled cross comparison of the relative importance of the factors as perceived by the four categories of participants. RII is a non-probabilistic rank statistic derived from ordinal data; hence, its accuracy is non-dependent on sample size or the population. Furthermore, Kendell’s coefficient of concordance was applied to determine the degree of agreement among the four categories of participants with respect to their ranking (Frimpong et al., 2003). The coefficient states that the degree of agreement on a 0 to 1 scale is given by W, such as that: (2) Σ

…

Σ

(3)

where n is the number of factors; m is the number of groups; and j represents the factors 1, 2, 3, … n. As noted by Frimpong et al. (2003), Kendell’s coefficient of concordance is strong on both probabilistic and non-probabilistic distributions, because it is not sensitive to sampling error. In addition, Chi-square statistic

410


was used to determine whether there was a significant difference in the ranking of contractual delay factors perceived to be influencing delays in the project’s completion. The Statistical Package for Social Scientist (SPSS) and Microsoft Excel were used to analyze the data.

Results The results of this study have been presented and interpreted under five thematic areas, including participants’ profile, types of delay experienced in SMHP project, components of contractual delay, and effects of delayed mobilization of resources on the project’s completion. Details are provided in the following sub-sections. Participants’ Professional and Work Experience The study covered 39 senior management staff of the contractual parties, including 14 (35.9%) from KenGen (the employer), 12 (30.8%) from Sinohydro (the contractor), 10 (25.6%) from Nippon Koei (the engineer), and 3 (7.7%) from JICA (the financier). The duration of professional and work experience is an important factor in successful management and administration of construction projects. In view of this, participants were requested to indicate the duration of experience in managing construction projects and more specifically, the duration of experience in managing SMHP project. The results are summarized in Table 3. Table 3 Professional and Work Experience Contractual party

Frequency

Employer Contractor Engineer Financier Total

14 12 10 3 39

Average experience (years) Construction projects Sondu-Miriu HP 2.6 2.3 2.1 1.7 3.0 2.1 2.0 1.3 2.4 1.9

Relative weighted management 0.9 0.7 1.0 0.6

The results show that the employer’s staff reported an average professional experience of 2.6 years in the management of construction projects and 2.3 years in the management of SMHP project. The contractor’s staff indicated an averaged experience of 2.1 years and 1.7 years in the management of construction projects and SMHP project, respectively. Engineer’s staff reported an average experience of 3.0 and 2.1 years; while the Financier’s staff stated the least experience of two years in the management of construction projects and 1.3 years in SMHP project. The results suggest low variability of experience among participants. The average experience was 2.4 years in management of construction projects and 1.9 years in management of the project. The engineer’s staff was the most experienced with a relative weight of 1.0 compared to the employer’s 0.9 and the contractor’s 0.7. The least relative management experience was noted among the financier’s staff, which was weighted at 0.6. Low variability further suggests that the participants were fairly homogenous in terms of professional experience and therefore provided reliable information with negligible internal deviation of ± 0.03 years. Furthermore, the contractual documents revealed that the employer set a minimum professional experience in managing construction projects at three years, upon which the reported duration of professional experiences was compared. The results show that it is only the engineer’s staff that met the minimum threshold, which may


411

suggest that the employer might have failed to exercise the authority to ensure adherence to qualification standards by all contractual parties. Projects which are managed by highly experienced personnel have a relatively lower risk of experiencing contractual delays, due to the management’s ability to proactively assess and mitigate potential risk factors that might lead to delays. In view of this, the staff of most contractual parties reported a professional experience, which is lower than the threshold set in the contractual documents, which might have contributed to the contractual delay experienced in SMHP project. Participants were requested to indicate their perspectives on whether SMHP project was on time or in delay. The results presented in Table 4 show that out of the 14 staff of the employer, 11 (78.6%) indicated that the project was in delay. The same status was confirmed by all the staff members of the contractor (12), the engineer (10), and the financier (3). Table 4 Perception on the Timeliness of the Project Contractual partner type

Frequency 3 0 0 0 3

Employer Contractor Engineer Financier Total

Yes Percent 21.4 0.0 0.0 0.0 7.7

No Percent 78.6 100.0 100.0 100.0 92.3

Frequency 11 12 10 3 36

Overall, 36 (92.3%) participants across the contractual parties affirmed that the project was not on schedule, while 3 (7.7%) expressed contrary opinions, suggesting that some participants might not be having sufficient experience in the project’s delay aspects. Nonetheless, the high proportion of participants (92.3%), affirming that the project was in delay, is a robust indication that the project’s completion was behind schedule. Types of Delay Experienced by SMHP Project Three main types of project delay, namely, contractual, stakeholder, and force majeure, were listed in the data collection instrument and participants requested to indicate their opinion regarding the frequency of occurrence on a five-point integer scale ranging from 1 to 5 and corresponding to “very low”, “low”, “medium”, “high”, and “very high”. A mean statistic, indicating convergence among groups, was computed to establish agreement among participants on the frequency of occurrence. Table 5 provides a summary of the findings. Table 5 Types of Delay at SMHP Project Contractual partner type Employer Contractor Engineer Financier Convergence

Contractual delay Mean Category 3.8 High 2.8 Medium 3.8 High 3.7 High 3.5 High

Stakeholder delay Mean Category 3.8 High 2.3 Low 1.5 Low 2.1 Low 2.4 Low

Mean 1.8 2.9 1.5 1.7 2.0

Force majeure Category Low Medium Low Low Low

The results show that the most common type of delay was contractual, scoring an average of 3.8 (high) among the employer’s staff, 2.8 (medium) among the contractor’s staff, 3.8 (high) among the engineer’s staff, and 3.7 (high) among the financier’s staff. Overall, the analysis obtained a convergence of 3.5 (high)

412


across all the groups. Regarding the stakeholder type of delay, the analysis obtained a mean score of 3.8 (high) among members of the employer’s group, 2.3 (low) among members of the contractor, 1.5 (low) among members of the engineer, and 2.1 (low) among employees of the financier. The overall convergence was 2.4 (low) across all the groups, which is an indication that the frequency of stakeholder delay was lower than contractual delay. The results in Table 5 further show that force majeure was the least common type of delay with scores of 1.8 (low) for the employer, 2.9 (medium) for the contractor, 1.5 (low) for the engineer, 1.7 (low) for the financier, and a convergence of 2.0 (low) across all the groups. This also implies that the frequency of force majeure was least common type of delay in the context of SMHP project. The results indicated the relative importance and hence, agreement among contractual parties regarding the order of importance. Components of Contractual Delay: Resource Mobilization Contractual delay is a manifestation of failure by parties involved to perform their contractual obligations. Timely mobilization of necessary equipment and human labor for the construction process is one of the key contractual obligations that were laid on the contractor’s shoulder. Taking cognizance of this, the study sought to establish perceptions of the management staff regarding the occurrence of resource mobilization delay within the context of SMHP project. In this regard, participants were requested to state at a nominal scale of “yes” or “no”, whether resource mobilization component of contractual delay ever occurred during the project’s implementation. Table 6 presents the results. Table 6 Components of Contractual Delay (%) Components of delay Design Payment Site possession Mobilization Legal procedures n

Employer Yes No 57.2 42.8 42.8 57.2 56.7 43.3 50.3 49.7 42.5 57.5 14

Engineer Yes No 79.9 20.1 40.0 60.0 9.8 90.2 90.2 9.8 80.4 19.6 12

Contractor Yes No 92.3 7.7 49.7 50.3 58.0 42.0 33.3 66.7 66.8 33.2 10

Financier Yes No 100.0 0.0 67.0 33.0 0.6 99.4 99.6 0.4 67.4 32.6 3

Yes 82.4 49.9 31.3 68.4 64.3

Overall No 17.6 50.1 68.7 31.6 35.7 39

RII 0.8 0.5 0.3 0.6 0.5

The study found that delay in resource mobilization was experienced during the project’s construction. Overall, 68.4% of the participants across all groups affirmed that the project experienced delays in the mobilization of necessary equipment and human labor. The analysis obtained RII for each form of contractual delay to facilitate ranking in terms of seriousness. The results show that delay in resource mobilization might have been serious, with an RII of 0.6. Effects of Delay in Resource Mobilization on Project’s Completion During the project planning phase, stakeholders consider and plan for how the equipment and human labor required to facilitate the construction process will be accessed. Timely availability of such resources is essential for successful completion of infrastructural projects within specified timeframes and budgets. Even though mobilization of resources to execute construction works is a contractual responsibility of contractors, employers/clients have an important role of facilitating the process through early payment as per contractual schedule. In this study, 68.4% of the participants identified delayed mobilization of resources as one of the


413

factors that contributed to delay in the completion of SMHP project. Participants attributed the delay to late disbursement of funds by the national treasury, as well as the contractors’ inefficiency. Based on this, the study sought to determine the effects of delayed mobilization of resources on the project’s completion. Table 7 presents the findings. Table 7 Effects of Resource Mobilization Delay on the Project’s Completion (%) Effect Prevents early completion Extends time & acceleration Loss of productivity & efficiency Re-scheduling & re-sequencing Increase time-related costs Abandonment of project n

Employer Yes No 78.6 21.4 71.4 28.6 85.7 14.3 92.9 7.1 71.4 28.6 21.4 78.6 14

Contractor Yes No 83.3 16.7 91.7 8.3 75.0 25.0 91.7 8.3 91.7 8.3 25.0 75.0 12

Engineer Yes No 70.0 30.0 60.0 40.0 80.0 20.0 90.0 10.0 80.0 20.0 10.0 90.0 10

Financier Yes No 66.7 33.3 66.7 33.3 100.0 0.0 100.0 0.0 66.7 33.3 0.0 100.0 3

Yes 76.9 74.4 82.1 92.3 79.5 17.9

Total No 23.1 25.6 17.9 7.7 20.5 82.1 39

The results show that up to 92.3% of the participants perceived that delayed mobilization of necessary resources instigated re-scheduling and re-sequencing of project activities. Participants pointed out that re-scheduling and re-sequencing of project activities were necessitated by postponement of work plan activities due to late arrival of necessary equipment and machinery. Although the processes enabled project stakeholders to adapt to the situation caused by untimely mobilization of resources, participants pointed out that the re-scheduling and re-sequencing of project activities had implications on the project’s budget. Participants further indicated that the processes touched all project activities and their relationships to each other vis-à-vis resources, such as time, funds, and human labor, among others, which necessitated the participation of all stakeholders. The results further show that 82.1% of the participants associated delayed mobilization of resources with loss of productivity and efficiency among workers. Participants noted that workers’ optimal productivity was a function of many variables, among them being the work environment, as well as availability and functionality of equipments. Thus, delay in availing such equipment, meant that workers were not supported and motivated to give their optimal output, leading to inefficient utilization of financial and time resources. Furthermore, 79.5% of the participants reported that delay in the mobilization of resources contributed to an increase of time-related costs. Notably, time-related costs are those the contractor incurred with the passage of the time, regardless of the amount of works carried out. In this regard, participants identified time-related costs that were incurred, due to delayed mobilization of resources, including maintenance of managerial staff, overhead costs, interest payable on loans, insurance premiums, as well as security services. During the delay period, the project incurred expenditures that did not translate into progression of construction works. As indicated in Table 7, up to 76.9% of the participants expressed the perception that delayed mobilization of resources prevented early completion of the project, which resulted to expenditure of more financial and time resources in order to make-up for the period of delay. More still, 74.4% of the participants indicated that delayed mobilization of resources led to the extension of timeframe and acceleration of works, which saw the

414


introduction of measures, such as overtime, night and day shifts, as well as inflation labor force, albeit with significant implications on the project’s budget. Participants pointed out that despite the introduction of such measures, which increased the project’s costs, stakeholders had to extend the project’s timeframe; which may suggest that measures taken to accelerate construction works did not contribute significantly to early completion of the project. Participants hypothesized that acceleration of works might have led to loss of productivity, particularly due to delays in payment of the contractor, which meant that workers were not paid and motivated consistently.

Discussions The study aimed at determining the effects of delayed resource mobilization on the completion of SMHP project, based on the perspectives of senior management staff of the contractual parties, including KenGen (the employer), Nippon Koei Company Limited (the engineer), Sinohydro (the contractor), and JICA (the financier). The purpose was to contribute to existing literature on infrastructural project delays, particularly in SSA countries, with a view to sensitizing stakeholders to work towards lessening such delays, in order to deliver inspirational, durable, efficient, and safe infrastructural facilities within scheduled timeframes and allocated budgets. Enhancing efficiency in the construction of infrastructural facilities is particularly important for SSA countries, where additional financial resources are required most to develop more facilities in order to spur social and economic development. The results showed that delayed mobilization of resources led to re-scheduling and re-sequencing of activities (92.3%), loss of productivity and efficiency (82.1%), increase in time-related costs (79.5%), prevention of early completion (76.9%), as well as extension of time and acceleration of works (74.4%). Delayed mobilization of resources is likely to drag the onset of works as well as heighten the risk inefficient utilization of time, equipment, and human labor to expedite infrastructural projects. Cost-overruns associated with delayed mobilization of resources often run into billions of dollars annually, which have obvious implications regarding the number of infrastructural projects that SSA countries can initiate over a period of time. There is no doubt that extra resources spent in offsetting the effects of delayed projects undermine the ability of many SSA countries to meet the need for infrastructural facilities. Again, cost overrun caused by delayed mobilization of resources is likely to cause bad reputation and even constrain relationship with external funding agencies, whose contribution to the construction of infrastructural facilities in SSA remains indispensable. Coping measures, such as re-scheduling and re-sequencing of project activities as well as extending time and accelerating works, though important, bring aboard significant budgetary implications, which increase the risk of cost-overruns. Whereas re-scheduling and re-sequencing entail drawing up new plans for project activities and resources, acceleration of works introduces new measures aimed at expediting timely completion of infrastructural projects. However, acceleration of works without adequate and consistent compensation of workers is likely to reduce labor productivity. Besides, inflating the labor force may not necessarily translate to acceleration of works, as new workers often take considerable time before gaining necessary skills and achieving optimal levels of productivity.

Conclusions Delayed mobilization of resources negatively affects the completion of infrastructural projects, particularly


415

in resource-poor contexts. Consequently, it is important for stakeholders to develop and share resource mobilization plans, considering the type of resources and quantities required, as well as acquisition, rental, and maintenance costs, among other parameters. The selection and utilization of equipment in a project should always be considered as an integral component of the entire resource mobilization plan. Such plans should also ensure availability and adequacy of skilled human resource to put the equipment to optimal use. Timely mobilization of adequate human resource of appropriate skills is essential for early completion of infrastructural projects within allocated budget and timeframe. Nevertheless, stakeholders should realize that having comprehensive plans for the mobilization of resources cannot be of much importance, if such plans are not facilitated through timely payment of contractors. In view of this, employers should work towards ensuring timely release of funds by national treasuries and timely payment of contractors. Being government agencies, most employers may not have the influence to expedite the flow of funds from higher hierarchies. This is where citizen participation becomes important, by influencing government expenditure priorities, especially through their leaders. Citizen participation is also crucial for enhancing accountability in the handling and management of project funds by employers and contractors.

References Abiero, A. (2010). Challenges of stakeholder management in implementation of Sondu Miriu Hydropower project in Kenya (Master’s thesis in project planning and management, University of Nairobi). Alaghbari, W. E., Kadir, M. R. A., Salim, A., & Ernawati, K. (2007). The significant factors causing delay of building construction projects in Malaysia. Engineering, Construction and Architectural Management, 14(2), 192-206. Assaf, S., & Al-Hejji, S. (2006). Delay causes in large construction projects. International Journal of Project Management, 24(4), 349-357. Aziz, R. F. (2013). Factors causing cost variation for constructing wastewater projects in Egypt. Alexandria Engineering Journal, 52, 51-66. Baldwin, J., & Manthei, J. (1971). Delay causes in the construction industry. Journal of the Construction Division, 97(2), 177-187. Bromilow, F. J. (1974). Measurement of scheduling of construction time and cost performance in the building industry. The Chartered Builder, 10(9), 57-65. De Souza, M. (2009). Project delays. Post Medium News, pp. 43-44. Frimpong, Y., Olowoye, J., & Crawford, L. (2003). Causes of delay and cost overruns in construction of ground water projects in developing countries: Ghana as a case study. International Journal of Management, 21(1), 321-326. Government of India. (2006). Infrastructure delay report. New Delhi: Ministry of Statistics. Government of Qatar. (2009). Major project and infrastructure in qatar. Doha: Ministry of Public Works. Government of South Africa. (1999). Design and construction of infrastructure projects. Cape Town: Department of Public Works. Japanese International Corporation Agency. (1985). Feasibility study for Sondu River Basin. Nairobi: JICA. Kometa, S. T., Oloimolaiye, P. O., & Harris, F. C. (1994). Attributes of UK construction clients influencing project consultants’ performance. Construction Management Economics, 12(5), 433-443. Majid, I. (2006). Causes and effect of delays in Aceh construction industry (Master’s thesis, University Technology, Malaysia). Melton, L. C., & Vann, T. T. (2013). Negotiating construction equipment leases getting beyond the battle of the forms. Retrieved from http://204.13.111.83/uploads/1172/doc/Negotiating_Construction_Equipment_Leases.pdf Nippon Koei. (2008). Delay to Sondu-Miriu Hydropower report (Unpublished project report, Nairobi, Kenya). Ondari, P. O., & Gekara, J. M. (2013). Factors influencing successful completion of roads projects in Kenya. International Journal of Arts and Entrepreneurship, 1(5), 1-22. Oso, W. Y., & Onen, D. (2005). General guide to writing research proposal and report: A handbook for beginning researchers. Kisumu, Kenya: Options Printers and Publishers.

416


Owolabi, J. D., Amusan, L. M., Oloke, C. O., Olusanya, O., Tunji-Olayeni, P., Owolabi, D., … Omuh, I. (2014). Causes and effect of delay on project construction delivery time. International Journal of Education and Research, 2(4), 197-208. Raj, B. V. A., & Kothai, P. S. (2014). Improving the labour productivity through other resources in construction field. International Journal of Engineering Research and General Science, 2(2), 205-213. Sambasivan, M., & Soon, Y. (2007). Causes and effects of delays in malaysian construction industry. International Journal of Project Management, 25, 517-526. SNL Financial. (2010). Sector focus intelligence. London: SNL Press. Talukhaba, A. A. (1999). An investigation into factors causing construction project delays in Kenya (A Ph.D. thesis, Department of Building Economics and Management, University of Nairobi).


D

DAVID

PUBLISHING

Transformations of Working Time as a Factor of Labour Dehumanization Renata Tomaszewska-Lipiec Kazimierz Wielki University, Bydgoszcz, Poland Shortening working time and making it more flexible, which have been observed in Europe since mid-20th century, are perceived as the main features and conditions for labour humanization as well as the sign of social progress. The aim of the article has been showing negative consequences of this phenomenon, especially for maintaining balance between work and private life. It was based on hypothesis that the tendency to shorten the working time and to make it more flexible cannot be seen only as a factor of humanization, as the achievements of the social policy in Europe have been accompanied by many negative aspects, having a negative influence over both employees and employers. One of those observed occurrences were progressive disturbances in balancing work and private life. The considerations have been based on critical literature analysis method, the analysis of formal legal documents and statistics reports and sources. The transformations of working time and their influence over free time shortage and thus the imbalance between work and private life have been analysed. The theoretical-problem analyses allowed to reach the conclusion that the transformations of working time, related to negative changes in its organization, can be perceived as a factor of dehumanization of one’s work. Keywords: world of labour, working time, free time, flexibility, humanization, work-life balance

Introduction For more than 100 years, the world has been undergoing many great transformations, with the dispersion of work’s unity in time and space being one of the domination trends described by literature. On one hand, by the end of the 19th century, the civilization introduced the organization of the working time, with around 80 hours of work a week; on the other hand, by the end of the 20th century, the average working week consisted of 40 hours of work. Optimistic future forecasts show that the working time in the mid-21st century will not exceed 20-30 hours a week. However, the data concerning the practice of economic life provided by Organisation for Economic Co-operation and Development (OECD) and Eurostat show that the shortening of working time seems to be merely apparent. The analyses of literature and statistical reports and sources confirm that the process of shortening people’s working time, resulting from the increasing level of work effectiveness, does not mean more free time for the workers. Furthermore, it has been observed that the importance of flexible employment forms in Europe has become more significant, which results in the demand for workers who can adapt to work well, especially when under time pressure. However, flexibility at work causes the loss of 

Renata Tomaszewska-Lipiec, Ph.D., assistant professor of pedagogy, Kazimierz Wielki University, Bydgoszcz, Poland. Correspondence concerning this article should be addressed to Renata Tomaszewska-Lipiec, Department of Labour Pedagogy and Andragogy, The Institute of Pedagogy, Faculty of Pedagogy and Psychology, Kazimierz Wielki University in Bydgoszcz, Chodkiewicza 30, Bydgoszcz 85-064, Poland. E-mail: [email protected].

418 TRANSFORMATIONS OF WORKING TIME AS A FACTOR OF LABOUR DEHUMANIZATION

flexibility in other areas of life, which has serious consequences for person’s physical and mental health, their functioning within the family and their social relationships. The transformations of the working time, especially in the developed countries, have inspired writing this article. They have been presented from the perspective of the working time humanization idea, as it is an important matter of global economics, including European social policy.

Shortening the Working Time as a Way to Labour Humanization The 20th century can be regarded as a period in human history, which was dominated by a strong development of the idea of humanism. Generally, it means the whole of changes in the treatment of human labour, which lead to giving fully humanistic character to the working conditions of an individual, expressed through a concern for the needs, dignity, and development of the individual. Humanisation of work requires such action and system of organization in the workplace that performing professional activities could be a factor in the development process through the work itself. Dynamics of civilization changes, the development of technology, and an increase of the amount of innovation force the use of the idea of humanism to a degree never seen before, because these phenomena bring negative consequences in the form of degradation of the working man. Approaches based on empirical studies emphasize the technical, economic, and social conditions that alienate professionally active person. Therefore, the basic properties and conditions of humanization of work include, among others:  perception of an employee as the subject of work;  ensuring safety at work;  shortening the working day and increasing the culture of work;  using replacement jobs, which guarantee a correct relationship man-machine;  active participation of workers in the control of technological and social processes;  increasing leisure time for the purpose of rest, recreation, and improvement of personality (Wiatrowski, 2005). Referring to the properties and conditions of the humanization of work directly related to the employee, one should pay attention to the mentioned postulates: shortening the working day and increasing leisure time of working people. From the perspective of the idea of humanization, working time is treated as one of the factors determining the amount of free time and affecting the level and quality of work, including the quality of the whole life of man and his family. Therefore, the presented reflections are devoted to the transformations of working time and in particular the phenomenon of its shortening. As for the working time, the member states of the European Union are primarily bound by the principles set out in article 31 of the Charter of Fundamental Rights of the European Union and the provisions of Directive 2003/88/EC of the European Parliament and of the Council on November 4, 2003 concerning certain aspects of the organization of working time. Provisions of the Directive state that working time shall mean any period during which the worker is working, at the employer’s disposal and carrying out his activity or duties, in accordance with national legislation or practice, while the rest period means any period which is not working time. With reference to the mentioned demands of the humanization of work, it should be noted that modern times are characterized by lengthening of the average life time while shortening of working time. According to Eurostat

TRANSFORMATIONS OF WORKING TIME AS A FACTOR OF LABOUR DEHUMANIZATION 419 data, over the last century, the average life time in Western Europe increased from 440,000 hours to 610,000 hours in 1980. Further prolonging of life time up to 700,000 hours occurred over the next 20 years (until 2000). As a result, the number of hours of performing commercial activities decreased from 150,000 hours at the end of the 19th century to 75,000 hours at the end of the 20th century and this process continues. Considering the involvement of working time during the whole of human life, one cannot ignore such characteristic phenomena, observed in recent years, as reducing the working week from six to five days, shortening the daily working time to eight hours, prolonged holidays, lengthening the period of education which delays the age of entering the job market, interruption of employment in order to increase or change professional qualifications, longer annual or occasional leave, the place of work moving away from the place of residence, etc. These phenomena contribute to the vision of 40,000 working hours as the average time of professional activities during the life of Europeans in the 21st century (Rajkiewicz, 2001). Statistical analyses show that the average working week in Europe is getting shorter. The average weekly working time in 2012 in the old member states of the European Union (EU-15) amounted to an average of 37.6 hours, while in the new member states (EU-13), it is 39.7 hours. The average size of annual working time in the old member states amounted to 1,677.4 hours, while in the new member, it was about 1,824 hours (Klos, 2013).1 It should be emphasized that this time, in particular countries, results from the law or agreements between employers and trade unions. In the latter case, it is often varied within the country and also depends on the sector or group of employees. OECD publishes statistical data of the annual number of hours worked by one working person and one hired worker in the 34 member states and in Russia. The analysis of the OECD average for the years 2004-2012 shows a decrease in the number of hours worked per year during this period, with the exception that this decline occurred mainly in the period 2005-2009 (from 1,804 hours to 1,761 hours). In 2010, the number of hours increased to 1,766 hours and stabilized at 1,765 hours in 2011-2012. In Poland, in the analyzed period, the number of hours of work significantly exceeded the average for the OECD and besides the increase in 2005, steadily decreased from 1,994 hours to 1,929 hours. The decrease in the number of hours worked in the period 2004-2012 was higher in Poland (54 hours) than the average for all OECD countries (45 hours) (Klos, 2013). The tendency to shorten working time is undoubtedly an important factor on the way to its humanization, which will contribute to the further transformation of the labour market. However, the question arises whether this process entails only positive effects, or whether the reduction of working time in this form, which was mentioned above, is a common practice and whether it does not contain the elements of dehumanization. An answer to this question will be attempted later in the article. Earlier, the issue of more flexible working time and forms of employment will be discussed.

Towards Flexible Working Time Continuing the discussion devoted to changes in the area of working time and referring to the separation of work in time and space, it is worth mentioning understanding of terms adopted in the European study: standard and flexible working hours. The definition proposed by the ISO Institut zur Erforschung sozialer Chancen in Cologne assumes that the normal hours of work means employment of full 35-40 hours performed five days a week, from Monday to 1

In the years 2004-2012 in the EU-15, the average weekly working time decreased and in the EU-12 increased. The difference increased from 1.6 hours to 2.1 hours.


Friday, at a fixed time schedule. All forms different from that described above are included in flexible working hours (Lipińska-Grobelny, 2013). In this context, it should be emphasized that the standard hours of work still are the “norm”. In 2010, 67% of employees worked the same number of hours every week and 58% the same number of hours each day; this situation in principle has not changed since 2000. Most Europeans still work five days a week in a standard time of 40 hours. A reflection of this is the typical place of work. Nearly 60% of employees in the European Union work all or almost all the time in the company premises (Retrieved from https://www.eurofound. europa.eu/sites/default/files/ef_files/pubdocs/2008/90/pl/1/EF0890PL.pdf). It must therefore be noted how stable the model of a “typical” working week is. Referring in turn to the issue of flexible working time and forms of its organization, it is worth mentioning three main directions of this flexibility:  more flexible organization of working time in chronometric dimension, which concerns the length of working time flexibility. Its basic form is the reduction of working time and flexibility is achieved based on part-time work and flexible retirement;  more flexible organization of working time in chronological dimension, meaning the choice of the mandatory time in a day, week, or year. One of the most popular forms is called flexible working hours, sabbatical leave, and cafeteria benefits enabling conversion of time resources to financial and non-financial profits;  more flexible organization of working time in chronometric-chronological dimension, which is characterized by temporary work, job sharing, annual working hours, shift work, work at home (telecommuting), and work “a la carte” (Pocztowski, 2007).2 In addition to flexible working time, another way of its differentiation is the flexible forms of employment. In legal literature, they are included in non-employee forms of employment that contrast the traditional model of work or employment. Non-employee form of employment refers to any non-standard forms of employment and includes term employment contracts, part-time work, telecommuting, and temporary work. Flexible forms of employment should also include civil contracts, self-employment, and management contract (Lipińska-Grobelny, 2013). In relation to flexible working time and flexible forms of employment, it is possible to indicate several characteristic trends in the labour market, which contribute to the dissipation of work in time and space. They are also the consequence of the process of reducing working time:  less stable employment, due to increasing popularity of flexible forms of employment;  increasing popularity of temporary work;  increase in part-time work;  greater flexibility of work (e.g., flexi-time, compressed hours, and job sharing);  greater flexibility of the place of work (e.g., telecommuting);  more frequent job changes and bigger number of employers (Grycuk, 2013). The outlined trends in the labour market show that flexible working time is increasingly becoming a feature of professional life in Europe and perhaps soon flexible working time and flexible forms of employment 2

It is one of the ways of shaping the working time in a flexible way, in the chronological (i.e., letting the worker choose and place their working time within the day, week, year, or even the whole life) and chronometric dimensions (which means changes in the working time’s length, which may concern the daily, weekly, yearly, or all-life working time). This organization form allows the worker to choose among many diverse ways of dividing their working time within set range, which is different from the standard working time.

TRANSFORMATIONS OF WORKING TIME AS A FACTOR OF LABOUR DEHUMANIZATION 421 will become “norm” and “standard”. Due to the imperative of increasing competitiveness, employers will seek opportunities for reducing labour costs offered by flexible working time and flexible forms of employment. As the statistical data demonstrate that already half of European companies employing 10 or more people have some kind of system of flexible working hours, the simplest form allows one to set the start and finish their working time in the working day. The greatest flexibility is provided by systems, which allow the accumulation of working hours and taking extended leave (so-called working time account) (Retrieved from https://www.eurofound.europa.eu/sites/default/files/ef_files/pubdocs/2008/90/pl/1/EF0890PL.pdf). Analyzing the transformations of working time, which have been accompanying people for more than 100 years, one can form a conclusion that they evoke a sense of accelerating the pace of work. As a result, practices leading to dehumanization of work become common, since organizations fall into a “trap of acceleration” and introduce one of the three patterns of destructive conduct:  overloading employees with work—the staff does not have time to carry out the commissioned responsibilities, lack of resources needed to achieve the tasks;  loading employees with a wide variety of activities—the organization does not have a clear direction of the business;  loading employees with new tasks—as a consequence of constant changes in the organization (Pluta, 2013). As a consequence of this type of practices used by employers, professional work takes over non-professional sphere of an individual, where not working time, but free time is shortened. Although theoretically speaking, it seems that the amount of free time should increase as a result of the introduction of paid leave, increased number of days off per week, formal limitation of the length of working day, and technological progress, in practice of the economic and everyday life of individuals, the proportions occurring between these two kinds of time, have been disturbed. The effects of this disharmony can be seen at the individual, social, and economic level. They cause doubts in the treatment of the mentioned transformations as properties of work humanization.

Transformation of Working Time—A Sign of Civilization Progress or Meter of Social Arrhythmia The tendency to shortening of working time and its evolution in the direction of flexibility are undoubtedly a measure of social progress, expressed as a prolongation of life and improvement of living conditions. So, they should be considered as factors of humanization of work, if these achievements of social policy were not also accompanied by adverse changes in the area of working time. These include:  increase in leisure time “unwanted” in view of the increasing unemployment; “empty hours” difficult to utilize in temporary jobs, causing negative psychological effects of being under constant pressure of job loss;  differences between statutory and actual working time; differences of increase of free time in each category of employment; growing phenomenon of workaholism, burnout, chronic fatigue syndrome, and even the phenomenon of sudden death due to overwork and stress defined as “karoshi”;  organizational changes in the shaping of time enforcing the new rhythm of work and rest, due to flexible working time and flexible forms of employment (Strzemińska, 2003). Analyzing further, it should be noted that hours worked in all European Union countries are higher than legal norms constitute. Longer working week is a phenomenon that primarily affects males: 18% of men work more than 48 hours a week, while for women, the figure is 8%. Self-employed persons also extend their


working week. Longer working week is more common in the production sector than that in the service sector (European Foundation for the Improvement of Living and Working Conditions, 2010). OECD (2013) said that the average working time for European countries in 2013 amounted to 1,765 hours per year. It also appears that poles are at the forefront industrious nations. An average pole devotes to work as many as 1,929 hours per year—in this respect among the countries surveyed by the OECD in Europe, Poland is outrun only by the Greeks and the Russians (Retrieved from http://www.fakt.pl/ile-pracuja-polacy-i-corobia-w-czasie-wolnym,artykuly,423652,1.html). These facts indicate that the actual work time is different from the statutory, adopted as “standard”. Continuing the analysis, it is also worth noting that according to employment status at the level of the entire European Union in the years 2004-2012, employers were a group declaring the greatest number of hours worked per week. Subsequent positions were taken by self-employed, helping family members and finally hired workers. Moreover, considering professional groups at the level of the whole European Union public officials, senior officials and managers declared the most hours worked during the period of 2004-2012 (46.9-45.4 hours); farmers, gardeners, foresters, and fishermen (46.5-44.3); least of all office workers (38.5-38.2); and simple jobs workers (39.8-38.9) (Klos, 2013). It can therefore be concluded that the number of hours worked remains in relation to the level of qualifications and responsibilities requiring a greater commitment of time than for lower-skilled workers, as well as working in various industries. One should also pay attention to the phenomenon of multiple job holders, referred to as “portfolio career”. Among the European Union countries, the rate of portfolio workers on the job market in 2010 amounted to almost 4%. The highest percentage of multiple job holders and so-called moonlighters was in Denmark (9.5%), Sweden (8.2%), and Poland (7.5%). Data from 2011 are comparable. “Portfolio employee” simply combines flexible forms of working time organization and flexible forms of employment. This phenomenon is sometimes referred to in legal nomenclature as hybrid employment (Lipińska-Grobelny, 2013). Continuing the topic of flexible working time and flexible forms of employment, it should be emphasized that although they are justified in economic terms, as indicated by Strzemińska (2003), one cannot treat them uniformly positive from the standpoint of humanization of work. Years of research in various research centres around the world have confirmed that the employee labour cost in its flexible forms (especially shift work) is associated with greater physical and mental fatigue, increased exposure to harmful environmental factors at work, and increased risk of participating in an accident at work. Non-standard working hours (night work and weekends) may also limit social life and disrupt the balance between work and family life. Such work schedules conflict with physiological readiness for physical and mental work in accordance with the endogenous rhythm of human life processes. Especially the night work is considered to be the cause of sleep disorders, problems with digestion, heart disease, and others. At the working time of over 40 hours a week, employees complain of worsening back pain, increasing fatigue and sleepiness, accumulating digestive ailments, and circulatory system diseases. The researchers conclude that, contrary to widespread opinion, flexible working time does not have a positive influence on family ties and better use of the time available for rest (Zużewicz & Konarska, 2005). As emphasized by representatives of ergonomics and work physiology, man is a diurnal species and all of their biological functions have circadian rhythm. Biological rhythms are one of the fundamental characteristics of living matter (life) and produced by evolution facilitate adaptation to cyclical changes in the natural

TRANSFORMATIONS OF WORKING TIME AS A FACTOR OF LABOUR DEHUMANIZATION 423 environment (Pokorski, 2008). Therefore, in this context, it is worth noting disseminated in the literature terms “non-stop society” or “24-hour society”, which indicate the departure of individuals and entire societies from the natural rhythms of nature, such as daily and annual rhythms, causing a threat to the health and life of humans. To conclude this part of the presented reflections, a conclusion can be formulated that the statutory limitation of working hours, which is taking place in European countries, does not reduce it in practice and thereby increases leisure time of workers. Shortening of working time related to adverse changes in the sphere of its organization can therefore be considered as a factor of dehumanization. Working time is inextricably linked to leisure time and the effects of disturbed balance between the sphere of family and professional life are experienced both by employees and employers. Further discussion is devoted to their mutual relations.

Towards Balance Work—Non-work Life Time of human life is treated as a specific value, recognized in the symbiosis of two spheres of life—work and leisure. Transformations of the world of work and the demands of professional responsibilities more and more frequently interfere with other spheres of life of an individual. More and more clearly, the relationship among working time and free time and worker’s productivity, salary level, standard of consumption, and social status is emerging. Nowadays, it seems that between working time and leisure time, sharp contrast appeared. A situation where working time and leisure time are felt by the employee as opposed spheres of life becomes a problem. Leisure time has become a negative of work; strictly speaking, it is work that has become negative, in relation to which, personal time takes on features of desired and positive. Thus, leisure time reveals itself as an antithesis of work—its absolute opposition and more and more often deficient. It is no coincidence that its definition is formulated in purely negative terms: the time not sold, unfettered, not subjected to rigors, control, and subordination (Danecki, 1974). Referring to the conclusion that free time has become a negative of working time, because time of being professionally active is prolonged, and taking into account the previous considerations, it seems that the analyzed transformations of working time lead to a deficit of free time, and thus to an imbalance in the relationship between professional work and private sphere. This phenomenon is confirmed by the statistics, which show that the Europeans lack the time for personal sphere. Over 40% of European workers believe that they do not have enough time for hobbies, interests, social work, or political activities. Over 25% believe that they do not spend enough time with family and friends. At the same time, they assume that it is the employers who are partly responsible for the lack of balance between work and private life (Retrieved from https://www.eurofound.europa.eu/sites/default/files/ef_files/pubdocs /2008/90/pl/1/EF0890PL.pdf). The signalled imbalance, sustained in the long term perspective, can lead to emotional exhaustion and lower self-esteem of individuals; thus, this in turn becomes a source of frustration, which negatively affects relationships with family members, employers, co-workers, and commitment to work. In contrast, a sense of harmony and appropriate proportions in this regard will be conducive to meeting new challenges of work and life. The second relationship is the most desirable, both by employees and employers.


Referring to the possibility of supporting workers by employers in this regard, it should also be noted that organizational and time solutions in large enterprises are formalized through rules, internal labour code, or a collective agreement. In medium and small enterprises, these solutions operate rather on the basis of practices adopted and accepted by the owners and management (Yasbek, 2011; Borkowska, 2010). Summing up this part of the presented reflections, maintaining appropriate balance between working time and free time generally comes down to reconciliation of professional and personal life and achieving personal happiness. This condition seems to be necessary, which is confirmed by an English physiologist Sheldon in a curve of happiness developed. The happiness curve is presented in the following Figure 1.

Figure 1. The curve of happiness by Sheldon. Source: Pluta (2013).

Selected points on Sheldon’s curve mean “m”—the maximum point where the man is satisfied with his professional activities; this corresponds to five to eight hours of work. At the same time, it appears that reducing the number of working hours leads to a decline in satisfaction, which results in the development of physiological disturbances (point “o”—obesity zone) or a sense of extreme inefficiency (point “n”). In contrast, extending the work beyond the point of maximum leads to overwork and causes the appearance of stomach ulcers (point “u”), nervous breakdown (point “b”), or total elimination from work caused by myocardial infarction—involves working 10 to 16 hours a day (point “c”) (Pluta, 2013). In relation to the above curve of happiness, it seems that due to the transformation of working time, for a growing number of professionally active people, achieving point “m” will become increasingly difficult.

Conclusions In light of the above reflections, it can be concluded that working time is, actually and often informally, lengthened and moreover unpaid, with all the negative consequences for both the employee and the employer. Basic properties of the humanization of work, such as shortening and flexibility of working time, have therefore a dual character: An opportunity for employment, undoubtedly however, contains many elements of dehumanization. Therefore, such an important issue seems to be the ability to maintain a balance between a

TRANSFORMATIONS OF WORKING TIME AS A FACTOR OF LABOUR DEHUMANIZATION 425 longer period of professional activity and psychophysical potential of an individual, their health, safety, as well as the personal sphere.

References Borkowska, S. (2010). The balance between work and non-work life. Acta Universitatis Lodziensis Folia Economica, 240, 8-13. Danecki, J. (1974). Unity of shared time. Warsaw: KIW. European Foundation for the Improvement of Living and Working Conditions. (2010). Living and working in Europe, yearbook. Luxembourg: Publications Office of the European Union. Grycuk, A. (2013). Major trends in the labour markets in developed countries. Studies Research Bureau of Chancellery of Sejm Poles’ Jobs, 4(36), 17-18. Klos, B. (2013). Working time in Poland compared to other European Union member states. Studies of Research Bureau of Chancellery of Sejm Poles’ Work, 4(36), 63-91. Lipińska-Grobelny, A. (2013). Portfolio employee—Analysis of the modern multiple employment. Organization and Leadership, 2, 135-139. Organisation for Economic Co-operation and Development. (2013). OECD employment outlook. Retrieved from http://dx.doi.org/10.1787/empl_outlook-2013-en Eurofound. (2009). Overview living and working in Europe. Retrieved from https://www.eurofound.europa.eu/sites/default/files/ef_files/pubdocs/2008/90/pl/1/EF0890PL.pdf Pluta, A. (2013). Time management—Strong or weak side of an employee of the twenty-first century. Humanistic Education, 1(28), 147-150. Pocztowski, A. (2007). Human resources management. Krakow: PWE. Pokorski, J. (2008). Medical aspects of night work and shift work. Proceedings from First International Conference Concerning Planning Working Time “Shift work in the 24/7 society”. Fakt. (2013). Poles are the most busy people. Retrieved from http://www.fakt.pl/ile-pracuja-polacy-i-co-robia-w-czasie-wolnym,artykuly,423652,1.html Rajkiewicz, A. (2001). Working time during life. In R. Horodeński and E. Ozorowski (Eds.), Man, ethics, economics. Bialystok: WSE. Strzemińska, H. (2003). Working time and the humanization of work and professional life at the turn of the century. In D. Walczak-Duraj (Ed.), Is it the twilight of work? Humanization in work relations (pp. 37-38). Plock: Pawel Wlodkowic University College. Wiatrowski, Z. (2005). Fundamentals of pedagogy of work. Bydgoszcz: Publishing House of Akademia Bydgoska. Yasbek, P. (2011). The business case for firm-level work-life balance policies: A review of the literature. Retrieved from http://employment.govt.nz/PDFs/FirmLevelWLB.pdf Zużewicz, K., & Konarska, M. (2005). Time—The fourth dimension of work. Work Safety, 9, 1-3.