Local manufacturing and engineering suppliers’ technological capabili6es development and industrial linkages in Zambia’s
mining sector By
Wisdom C. KALENG’A
A PhD Proposal Presenta/on to UNZA’s Development Studies Department 2015-‐08-‐20 Thursday
Supervisors & Funders • Supervisors: – Dr. Godfrey Hampwaye, Geography and Environmental Studies Department, The University of Zambia;
– Prof. Peter Kragelund, Department of Society and GlobalisaEon, Roskilde University, Denmark;
– Prof. Soeren Jeppesen, Department of Intercultural CommunicaEon, Centre for Business and Development Studies, Copenhagen Business School, Denmark
• Funders: – DANIDA through SAFIC Project
Presenta6on outline • Background • Problem statement • Jus6fica6on and Significance • Research Objec6ve • Research Ques6on • Literature Review: Firm-‐level Technological Capabili6es (FTCs) & Industrial Linkages
• Methodology
Background
• 1964: market economy & private ownership of mines
• 1968/69: Na6onaliza6on &
Zambianiza6on • ZCCM forma6on in April
1981 – development of a local supply
cluster linking the mining sector to others
Background con6nued • 1991 return to democracy and economic liberaliza6on
• 1997 commencement of sale of mines • 2002 mi6ga6on measures (TNDP & later FNDP) – Subsequent rise in FDI in mining versus state of industrial base and local par6cipa6on
Problem Statement • Some Research on Zambia’s
supply chain in the copper mining sector have been conducted focusing on: – local suppliers in their general
sense – lack of capacity in a generic sense
among local suppliers – Judith Fessehaie’s recent PhD work
(the only comprehensive academic research thus far on Zambia) • largely analyses the mismatch
between the capabili6es suppliers possess and those the mining companies need to hire in order to have sa6sfactory goods and services
• Research Gap – what the aspects cons6tu6ng such a
mismatch really are from the local suppliers’ perspec6ve is insufficiently addressed
– Pockets of technological capabili6es that exist among some of the local suppliers have been highlighted but remain under-‐researched more especially how such technological capabili6es are developed and/or impeded over 6me.
– The roles firm-‐level technological capabili6es development (and/or lack thereof) process and the supplier firms play in the Zambia’s industrial development via backward linkages in a liberalized market equally remains insufficiently researched
Photos credit: Wisdom Kaleng’a, 2014
Jus6fica6on & Significance • New insights into industrial linkages via local manufacturing and engineering firms
• Improved understanding: MNCs and FDI versus local firms’ development and industrial linkages
• A bridge between business and development studies • A voice for beneficiaries and to benefactors in copper-‐mining sector
Research Objec6ve Overarching Objec/ve To inves6gate how local manufacturing and engineering suppliers in Zambia’s mining sector, par6cularly the copper sub-‐sector, develop their technological capabili6es, and the extent to which the technological capabili6es development is a source of industrial linkages.
Specific Objec6ves 1. To theore6cally establish what firm-‐level technological capabili6es (FTCs) are and
how they are developed 2. To ascertain the extent to which the existent technological capabili6es among
Zambian suppliers determine their compe66ve advantage in the mining sector 3. To assess how the firm-‐level technological capabili6es and their development
among Zambian suppliers are or are not an ingredient for industrial linkages between the suppliers and mining companies.
4. To establish the role key actors (mining companies, government, regulatory ins6tu6ons, and financial ins6tu6ons) play in the firms’ technological capabili6es development processes
Research Objec6ve
Main Objec6ve:
To inves6gate how local manufacturing and engineering suppliers in Zambia’s mining sector, par6cularly the copper sub-‐sector, develop their technological capabili6es, and the extent to which the technological capabili6es development is a source of industrial linkages.
Specific Objec6ves: 1. To theore6cally establish what firm-‐level
technological capabili6es (FTCs) are and how they are developed
2. To ascertain the extent to which the existent technological capabili6es among Zambian suppliers determine their compe66ve advantage in the mining sector
3. To assess how the firm-‐level technological capabili6es and their development among Zambian suppliers are or are not an ingredient for industrial linkages between the suppliers and mining companies.
4. To establish the role key actors (mining companies, government, regulatory ins6tu6ons, and financial ins6tu6ons) play in the firms’ technological capabili6es development processes
Photos of Local manufacturing & engineering Suppliers’ products & plant – source: Wisdom Kaleng’a, 2012
Research Ques6on Main Ques/on
How and to what extent is technological capabiliEes development among local manufacturing and engineering suppliers in Zambia’s copper mining sub-‐sector a source of industrial linkages?
Sub-‐ques/ons • The main research ques6on will be answered with the help of the following
sub-‐ques6ons: • What are firm-‐level technological capabili6es (FTCs) and how are they
developed? • To what extent do the existent technological capabili6es among Zambian
suppliers determine their compe66ve advantage in the mining sector? • In what ways are firm-‐level technological capabili6es among Zambian
suppliers determining the breadth and depth of industrial linkages between the suppliers and mining companies?
• What role do key actors (mining companies, government, regulatory ins6tu6ons, and financial ins6tu6ons) play in the firms’ technological capabili6es development?
Literature Review: Firm-‐level Technological Capabili6es (FTCs) & Industrial Linkages
• FTCs can be defined, studied and classified is as seminally outlined by Sanjaya Lall (see e.g. Lall 1992; Lall 1993a; Lall 1998; Lall 2000; Lall 2004; Lall & Narula 2004; Saith 2005)
• Industrial linkages – Albert O. Hirschman’s (1958) novel work pioneering industrial linkages
Basic Level Intermediate level Advanced level FTC Type Investment Capabilities
- Vision/mission for the firm - Purchase/installation of equipment - Simple plant erection/renting - Type and source of initial business capital - Current and Recent turnover
- Past, recent and/or current access to operational capital (formal sources)
- Purchase of new equipment/machinery/vehicles
- Past, recent and/or current access to supplier credit
- Intent and efforts to expand existing or establish new office/location
- Intent and efforts to grow market share - Intent and efforts to expand number of
full-time employees
Production capabilities
Product - Absence of or low defects of products supplied
- Current market share - Types of core products/services
- Product modification - Expansion of product mix
- Marketing excellence/strategies – online and offline
- Participation in trade exhibitions
Process - Equipment/Vehicle Care and Maintenance routines
- Equipment calibration
- Presence of quality control team - Production processes
improvement/modification
- Automation of production or operative systems
Resources - Total number of employees - Type (manual or automated) and Stock of
equipment/machinery - Type and number of vehicles – vans,
heavy duty trucks etc - State (rented or own) plant/land and
offices/buildings
- Growth in employees in past 3-5years - Presence of employees’ in-house training,
coaching, mentoring mechanisms - Skills, qualifications and experience of
employees versus employee types (white or blue-collar) and gender
- Occupational health and safety (OSH) strategy
- Past, recent and/or current support to employees training externally (local or foreign colleges/universities)
Linkage Capabilities
- The firm has been in business and industry for at least three (3) years
- Number of years firm owner and management have been in the industry
- Grade/level of NCC, EIZ etc certification - Previous/current access to government
incentives - Previous/current joint bidding or project
execution with local firms
- Intent and efforts to upgrade with NCC, EIZ
- Sub-contracting - Active participation in Business
Associations; trade expositions; government events; workshops and trainings
- Presence of management structure - Previous/current ( and future) other joint
ventures e.g. with foreign firms
Firm-‐level Technological Capabili/es Indicators among Zambian Engineering Firms
Rela6onship between Key Actors, Market Features and Local Suppliers in FTC Development
•
Methodology • Case study research design: Case study of Zambian or local supplier
firms’ technological capabili6es development and industrial linkages in the mining sector
• The topic is a single case study requiring a number of sub-‐cases (local supplier firms) to be studied for a detailed understanding (Yin 2009)
Type of Respondent Main Type of Business/Name of Organization Expected Number
Local supplier Manufacturing/Metal Fabrication 10 Civil Engineering 10 Mechanical/Chemical/Geotechnical 10 Other firms e.g. PPE Suppliers; Ndola Lime; ZAMEFA 5
Sub total 35 Mining companies Copper Mining Houses 5 Government Ministries (Mines; MCTI) 2
e.g. Agencies (CEEC; ZDA; ZCCM-IH) 5 Local/Municipal Councils; Traditional Leaders 5
Sector Regulator e.g. NCC; EIZ; TEVETA; 5 Training Institutions e.g. UNZA; CBU; NORTEC 5 Business Associations e.g. ZAM; Chamber of Mines; ZACCI; Local Suppliers & Contractors Association 5 Banks/International/Other Organizations
e.g. ZANACO; World Bank; AfDB; SIDA; PEP Zambia; Murray & Roberts 10
Mine Museum Mines historical data 1 Sub total 43 GRAND TOTAL 78
Photos credit: Wisdom Kaleng’a, 2012,2014, 2015
Methodology cont… • Total number of cases (firms) versus Generaliza6on – ‘sta6s6cal generalizability’
– Emphasis on ‘analy6c generaliza6on’ (Creswell, 2007: 76; Gomm, Hammersley, & Foster, 2009; Yin, 2009; Yin, 2014: 40-‐2).
• Triangula6on
• Data validity and reliability
• Data analysis – Content analysis
• Development studies research versus ethics
Timeline
• Thank You