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