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From Site Selection magazine, November 2013

Flying High in Lithuania


work-force development partnership between Ryanair and the School of Mechanics at Kaunas University of Technology in Lithuania is paying off in capital investment and jobs. Due to an increase in qualified employees, Ryanair, the Dublin-based ultra-low cost carrier (ULCC), is expanding its aircraft maintenance operations, investing $2.16 million (€1.6 million) at its Kaunas Aircraft Maintenance Services (KAMS) facility at Kaunas Airport in Lithuania. This expansion comes on the heels of an investment of over $4 million (€3 million) to build a new aircraft KAMS_Hangar maintenance and repair hangar in Kaunas earlier this year.

The KAMS maintenance, repair and operations facility currently has 50 employees. The company will add 40 aviation mechanic positions, doubling the operation’s aircraft service capacity.

Dublin-based Ryanair is expanding its maintenance operations at the Kaunas Airport in Lithuania.
Photo courtesy of Ryanair

Costa Rica: FDI Welcome Here


urther cementing its status as an FDI-friendly country, Costa Rica’s Trade Minister Anabel González signed the Organization for Economic Cooperation and Development (OECD) Declaration on International Investment and Multinational Enterprises along with OECD Secretary-General Angel Gurría at a signing ceremony in Paris in September (pictured here).

CostaRicaOECD Photo courtesy of OECD

The document confirms Costa Rica’s progress in transforming its economy through diversification and becoming more knowledge-based. Signing the declaration officially puts out the welcome mat for foreign investors and promotes responsible, ethical business conduct in Costa Rica.

FDI in Costa Rica was already on the rise. The OECD released an Investment Policy Review of Costa Rica stating FDI increased 13 percent on average for the past decade. From 2002 to 2012, telecommunications alone jumped from 8 percent of total inflow to 40 percent of total inflow.

Does Outsourcing R&D Overseas Make a Company More Innovative? Mais Oui


Professor Michael Mol, Warwick Business School
Photo courtesy of Warwick Business School

rench businesses that outsource R&D overseas are more likely to innovate than those who outsource at home according to a paper written by Professor Michael Mol, of Warwick Business School, and Associate Professor Olivier Bertrand of SKEMA Business School in France, published in Strategic Management Journal.

The researchers studied a database of 6,015 French businesses over a five-year period and found that product and process innovation suffered when served by home R&D suppliers.

“Home outsourcing occurs when firms lack innovative capabilities and are either trying to save costs or their own internal R&D department are lacking,” wrote Mol. “By contrast, those that choose to outsource abroad do so to tap specialist sources of knowledge that complement and strengthen their own internal R&D.”

Mol said “cognitive distance,” the gap in knowledge and understanding between the business that outsources and its supplier, plays a key role in the decision whether to outsource R&D. In the case of innovation, home R&D suppliers are seen as less attractive because their knowledge base is too similar.

Putting on the Shift


Alcatel-Lucent CEO Michel Combes stands by his Shift Plan, an across-the-board restructuring plan announced in June.
Photo courtesy of Alcatel-Lucent

lcatel-Lucent is doing what it can to stay alive. That includes moving from its Paris headquarters into less expensive digs outside the city. The financially ailing telecommunications equipment company will also cut 10,000 jobs, including 900 in France, and reduce the number of business hubs globally by half by the end of 2015.

The extraordinary measures are part of Alcatel-Lucent’s Shift Plan, an across-the-board restructuring plan announced by CEO Michel Combes in June. The plan seeks to restore the company to profitability by increasing efficiencies in R&D and reallocating resources towards innovation, while reining in fixed expenses.

In an October 8 interview with French newspaper Le Monde, Combes stated that implementation of The Shift Plan represented the company’s “last chance” to remain viable. Employees had a different view, taking to the streets of Paris in mid-October to protest the cuts.

Rolling Out the Red Carpet


Shaw Industries’ new plant in Nantong, China, will produce modular carpet tiles for the Asian market. Photo courtesy of Shaw industries

riven by increasing consumer demand, Berkshire Hathaway’s Shaw Industries announced the opening of a new plant in Nantong, China, a port city 65 miles (105 km.) north of Shanghai.

“Two thirds of the world’s carpet tile is sold outside of North America — the majority in Asia,” says Shaw Industries Chairman and CEO Vance Bell. “Sales in China, in particular, have grown 20 percent annually, making it the world’s third largest carpet-tile-purchasing country. Our new plant expands our opportunity to serve this growing market.”

The 210,000-sq.-ft. (20,000-sq.-m.) plant will manufacture modular carpet tiles designed at a Shaw facility in Cartersville, Ga. They will be sold in the Asian market, and are not for export to the US. The plant will employ 250 when at full strength. A similar plant is being built in Adairsville, Ga.

Samsung Electro-Mechanics Invests Billions In Vietnam


amsung Electro-Mechanics Vietnam (SEMV) received a license from officials in the northern province of Thai Nguyen to invest US$1.2 billion in electronics production. The plant, which would make integrated circuits and components for mobile devices, will be built in the Yen Binh Industrial Park.

The Yen Binh plant will be part of a high-tech complex that Samsung began developing in Thai Nguyen in late March. The complex, which includes a $2-billion mobile phone and component plant, will cover 65 acres (26.5 hectares) and should be finished within four years.

The two projects have boosted Samsung’s total capital investment in Vietnam to $5.7 billion.

Nanyang Technical University Climbs in World University Rankings


ingapore’s Nanyang Technical University (NTU) took the number one spot in industry income and innovation and ranked 76th overall in the recently published Times Higher Education (THE) World University Ranking report. The industry income and innovation indicator is one of 13 criteria used to measure a university’s knowledge-transfer capabilities by looking at its ability to attract income from research provided to competitive commercial enterprises.

NanyangSchool_ArtDesignMediaNTU Nanyang Technical University in Singapore was ranked number one in industry income and innovation and ranked 76th overall in Times Higher Education’s World University Rankings. Photo courtesy of Nanyang Technical University

Much of the NTU’s jump in the industry income and innovation ranking can be attributed to expansion of partnerships between the university and companies like Rolls-Royce, Lockheed Martin and BMW. The university recently opened a $75-million Rolls-Royce Corporate lab furthering NTU’s research impact in aerospace technology development. Aerospace leader Lockheed Martin established a lab with NTU to collaborate on nanotechnology research while the BMW partnership establishes a joint mobility lab at the university, one of only eight worldwide and BMW’s only such lab in Asia.

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