Sasol mining : a case study in outsourcing

Van der Walt, Christo (2007-03)

Thesis (MBA)--Stellenbosch University, 2007.

Thesis

ENGLISH ABSTRACT: Sasol Mining is a wholly owned subsidiary of Sasol Limited, an integrated oil and gas company with substantial chemical interests. Sasol Mining extracts and supplies coal to Sasol's synfuels and chemical plants in South Africa, but also sells some of its output to extemal customers, primarily international (United States Securities Exchange Commission, 2005: 39). Outsourcing, the practice of buying products and services from external suppliers, increasingly forms part of the Sasol Mining business environment and some of the challenges experienced and trends seen raise some interesting why and how questions. Such questions are the topic of this research report. The case study strategy to research has considerable ability to generate answers to 'why?' as well as 'what?' and 'how?' questions (Saunders, et aI., 2003: 93). Before such questions are explored further however, a comprehensive literature review was carried out, but with the intention to develop a theoretical framework of good outsourcing practice. This theoretical framework lies at the heart of the research design and methodology. The research objective is to develop an explanatory theory that associates certain factors with the effectiveness of outsourcing initiatives at Sasol Mining. This research report's central proposition is that any results obtained by Sasol Mining with outsourcing initiatives can be explained by understanding to what extent its management of the outsourcing process is in line with the theory of good outsourcing practice. This case study's fundamental design will be that of a single-case with multiple, embedded units of analysis. Sasol Mining serves as the single case in this research design and individual outsourcing initiatives and its results at Sasol Mining are logical subunits that can be identified and is studied in operational detail. Good evidence was found that the effectiveness of outsourcing initiatives at Sasol Mining can be explained by understanding the extent to which its outsourcing practices are in line with the theoretical framework of good outsourcing practice. In addition, it is recommended that Sasol Mining raise a strategic debate regarding outsourcing and its place in Sasol Mining's business strategy, but against the backdrop of its current outsourcing practice and the developed theoretical 'framework. There is good evidence that this framework developed as part of the literature review (heretofore not presented at such an integrated, all-encompassing level) is a "good" theory. Tantalising bits of information in the form of thematic materials and recurring patterns surfaced during data reduction and analysis. Black Economic Empowerment and outsourcing is one such example, and it was explored to some extent. Many more exist. The case study as a research strategy was successful in the sense that the research question could be answered, in addition to the analytiC generalisation that could be made about the nature of the theory on outsourcing practice itself. Although at times data recording and analysis requirements were onerous, the research strategy also led to an in-depth understanding of Sasol Mining as a business. This is the strength of the case study approach to research. That is also what made the research report worthwhile.

AFRIKAANSE OPSOMMING: Sasol Mynbou is 'n filiaal van en word ten volle besit deur Sasol Beperk, 'n ge'integreerde olie- en gas maatskappy met uitgebreide chemiese belange. Sasol Mynbou ontgin en voorsien steenkool aan Sasol se sintetiese brandstowwe- en chemiese aanlegte in Suid Afrika, maar verkoop ook steenkool aan eksterne klante, hoofsaaklik in die internasionale arena (United States Securities Exchange Commission, 2005: 39). Eksterne verkryging, die praktyk waarvolgens 'n onderneming produkte en dienste van eksterne verskaffers verkry, vorm toenemend deer van die Sasol Mynbou besigheidsomgewing en van die probleme wat ervaar word daarmee en van die waarneembare neigings laat interessante hoekom en hoe vrae ontstaan. Sulke vrae vorm die onderwerp van hierdie navorsingsverslag. Die gevallestudie benadering tot navorsing beskik oor 'n kragtige vermoil om antwoorde te verskaf rakende 'hoekom?', 'wat?' en 'hoe?' vrae (Saunders, et ai., 2003: 93). Alvorens sulke vrae egter verder ondersoek word, word 'n omvattende literatuurstudie uitgevoer met die doer om 'n teoretiese raamwerk te ontwikkel van goeie eksterne verkrygingspraktyk. Hierdie teoretiese raamwerk vorm ook die kern navorsingsontwerp en -metodologie. Die navorsingsdoelwit is om 'n verklarende teorie te ontwikkel wat sekere faktore koppel aan die effektiwiteit van eksterne verkrygingsinisiatiewe by Sasol Mynbou. Hierdie navorsingsverslag se sentrale stelling is: enige resultate wat deur Sasol Mynbou behaal word met eksterne verkrygingsinisiatiewe kan verklaar word deur die mate waartoe die eksterne verkrygingsproses bestuur word volgens die teoretiese raamwerk van goeie eksterne verkrygingspraktyk. Die gevallestudie se fundamentele ontwerp is een van 'n enkele geval met veelvuldige ingeslote eenhede van analise. Sasol Mynbou dien as die enkele geval met individuele eksterne verkrygingsinisiatiewe en hul onderskeie resultate wat identifiseerbaar is as logiese sub-eenhede. Daar is goeie bewyse gevind dat die effektiwiteit van eksterne verkrygingsinisiatiewe by Sasol Mynbou verklaar kan word deur 'n beg rip te ontwikkel vir die mate waartoe die bestuur van hierdie inisiatiewe belyn is met die teoretiese raamwerk van goeie eksterne verkrygingspraktyk. Dit word ook aanbeveel dat Sasol Mynbou 'n debat op strategiese vlak begin wat handel oor eksterne verkryging se plek in die algemene ondernemingstrategie, maar binne die konteks van die huidige praktyk by Sasol Mynbou en die teoretiese raamwerk wat as deel van hierdie navorsingsverslag ontwikkel is. Daar is ook goeie bewyse dat die teoretiese raamwerk (voorheen nie aangebied op so 'n ge"lntegreerde, omvattende vlak nie) aan die vereistes van 'n "goeie" teorie voldoen. 'n Aantal interessante temas en herhalende patrone het oak na vore gekom gedurende data analise. Swart Ekonomiese Bemagtiging en eksterne verkryging is 'n voorbeeld van so 'n herhalende patroon en dit is tot 'n sekere mate verder ondersoek. Daar is ook ander voorbeelde van soortgelyke patrone. Die gevallestudie as 'n navorsingstrategie was suksesvol tot so 'n mate dat die navorsingsvraag beantwoord kon word, en boonop was dit ook moontlik om afieidings te maak rakende die teorie van eksterne verkrygingspraktyk. Hoewel data vaslegging en -analise soms oarweldigend was, het die navorsingstrategie tog gelei tot 'n diepe insig van Sasol Mynbou as 'n besigheid. Dit is die krag van die gevallestudie benadering tot navorsing. Dit is ook wat die navorsingsverslag die moeite werd gemaak het.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/21187
This item appears in the following collections: