The introduction of new technology in a mature industry : an evolutionary analysis of the South African textile industry

Jafta, Rachel Catharina Cornelia (2003-12)

Dissertation (PhD)--Stellenbosch University, 2003.

Thesis

ENGLISH ABSTRACT: At the beginning of the 1990s, the South African textile industry faced many challenges, including the dismantling of protective barriers, requiring firms to adapt to increased foreign competition in the local and global markets. Many opted for investment in new technology. This study set out to analyse the behaviour of South African textile firms in the process of introducing new technology in pursuit of competitiveness. The analysis was conducted following the evolutionary approach in economics (discussedin Chapter 2). This approach incorporates time, pays attention to the deliberate actions of firms to shape their environment, as well as persistent diversity amongst firms. This study asked two broad questions. First, what were the major trends in textiles regarding technology, demand-side factors, the trade regime, etc.? (Chapter3). Chapter 3 sets the scene for the rest of the study in that it illustrates how the competitive environment of textile firms has changed and argues that the aggregate picture is often not a true reflection of the dynamics of the industry, thus paving the way for micro-level analysis of firms and institutions. Secondly, what were the subsequent responsesby textile firms and institutions to these changes?This question is investigated for the global textile industry (Chapter 3), the South African, Italian and Mauritian textile industries (Chapters 4 and 5), and for specific firms in the South African textile industry (Chapters 6 and 7). Institutions play an important role in shaping the development of industries, just as firms in an industry may influence institutions. The role of institutions in the South African textile industry is considered in Chapter 5, which serves as background to Chapter 6, where we enquire about the significance of these institutions from the firms' perspective. The central focus of Chapter 6, however, is on the processof acquisition and implementation of new technology in South African textile firms. The implications of this process for other strategies, organisational processes, competencies, and routines are also analysed. Basedon the outcome of the firm-level analysis, three categories of firms are distinguished, namely leading firms, moderate adapters, and laggards. Using the characteristics of the firms in each category, we select three firms to pursue further in case studies. Chapter 7 presents the results of these case studies. Although the main focus of our study is on the implementation of new technology, we want to illustrate in this chapter how the successof this process critically depends on factors such as an appropriate organisational structure, the competencies of management and labour, as well as the institutions in the industry. We further highlight the important role that individuals, such as entrepreneurs, play in shaping the paths of firms, their relationships with institutions, suppliers, and customers, and even the structure of the industry. We conclude that investing in new technology is a necessary but not sufficient strategy for successful rejuvenation of firms in a mature industry. Complementary changes, such as in organisational structure, use of human resources, and supply-chain relations, are of crucial importance, too (Chapter 8).

AFRIKAANSE OPSOMMING: Aan die begin van die 1990s het die Suid-Afrikaanse tekstielbedryf menige uitdagings (soos die aftakeling van beskermingsmaatreëls) in die gesig gestaar, wat hulle gedwing het om meer doeltreffend in die plaaslike en globale markte te word. Hierdie studie ontleed die gedrag van ondernemings in die tekstielbedryf in die proses van verkryging en implementering van nuwe tegnologie ten einde mededingingendheid te bevorder. Die studie volg die evolusionêre benadering, wat tyd inbou en aandag skenk aan doelbewuste aksies deur maatskappye om hulle omgewing te beïnvloed, asook volgehoue diversiteit tussen maatskappye (Hoofstuk 2). Die studie het twee breë vrae gestel. Eerstens, is daar gekyk na die belangrikste tendense t.O.V. tegnologiese veranderinge, vraagkantfaktore, handelsregulasies, ensovoorts, in die tekstielbedryf (Hoofstuk 3). Hoofstuk 3 skets die struktuur vir die res van die studie deur die veranderinge in die omgewing waarbinne tekstielmaatskappye meeding uit te lig, maar ook deur aan te toon dat die globale prentjie nie altyd 'n ware refleksie van die dinamiek van 'n nywerheid is nie, omdat soveel diversiteit daardeur verbloem kan word. Hierdie argument is dus ten gunste van verdere mikrovlak analise van ondernemings en instellings. Tweedens word gevra watter reaksies op hierdie veranderinge daar van ondernemings en instellings se kant af was. Hierdie vraag word ondersoek vir die globale tekstielbedryf (Hoofstuk 3), die Suid-Afrikaanse en Italiaanse tekstielbedrywe, asook die bedryf in Mauritius (Hoofstuk 4 en 5). Verder word die vraag vir spesifieke Suid-Afrikaanse ondernemings in Hoofstukke 6 en 7 bestudeer. Instellings speel 'n belangrike rol in die ontwikkeling van nywerhede, net soos ondernemings in nywerhede ook instellings kan beïnvloed. Die rol van instellings in die Suid-Afrikaanse tekstielbedryf word in Hoofstuk 5 behandel, deels as agtergrond vir Hoofstuk 6 waar die belangrikheid van instellings uit die ondernemings se oogpunt van naderby beskou word. Die hooffokus van Hoofstuk 6 is egter die verkryging en implementering van nuwe tegnologie in Suid-Afrikaanse tekstielmaatskappye. Die implikasies wat hierdie proses vir ander strategieë, organisatoriese prosesse, vaardighede en roetines van die ondernemings inhou, word ook bestudeer. Voortvloeiend uit die ondernemingsvlakanalise, word drie kategorieë van ondernemings onderskei, naamlik leiers, middelmatige aanpassers en sloerders. Op grond van die kenmerke van die ondernemings in elkeen van die kategorieë is drie maatskappye vir verdere ontleding in gevallestudies gekies (Hoofstuk 7). Alhoewel die hooffokus van die studie die implementering van nuwe tegnologie is, illustreer ons ook in Hoofstuk 7 dat die proses sterk beïnvloed word deur faktore soos die organisatoriese struktuur, die vaardighede van die bestuur en werkers, sowel as die instellings in die industrie. Ons beklemtoon verder die belangrike rol wat individue, soos entrepreneurs, speel t.O.V. die ontwikkelingstrajek van ondernemings, sowel as die verwantskappe wat ondernemings met verskaffers, instellings en klante opbou. Aksies deur individue beïnvloed in die finale instansie ook die struktuur van die industrie. Ons gevolgtrekking is dat investering in nuwe tegnologie 'n noodsaaklike maar nie voldoende strategie vir die suksesvolle vernuwing van ondernemings in 'n volwasse nywerheid is nie. Komplementêre veranderinge, byvoorbeeld in die organisatoriese struktuur, die benutting van arbeid, en verhoudings in die verskaffingsnetwerk, is ook van kernbelang.

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