Research Assignment_Global Operations Management_module 8.docx

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Munkombwe Madubeko Module 8 Research Paper OSM5122 / Global Operations Management Dr. Raj Parikh 8 th November 2020.
2 Research Paper Mulungushi Textiles Introduction Global supply chain management has extremely gained reputation since the past decades due to a competitive business environment globally. Christopher et al. (2006) emphasizes the need to have supply chain designed for global operations and they argue that the choice of supply chain strategy impacts competitive performance. Mulungushi Textile Joint Venture Ltd (Mulungushi Textiles) used to be the largest textile company in Zambia. The company is situated between Kabwe and Kapiri, about 15 km from Kabwe’s central business district, used to employ about 2,000 workers and produced 1,800 tons of cotton yarn, 17 million meters of various fabrics and 100,000 pieces of garments every year. Its two ginneries could process 20,000 tons of seed cotton a year. It also has a refinery that produced about 600 tons of cotton seed oil. Mulungushi Textiles was also into cotton growing. Through 5,000 contracted farmers, it controlled 10,000 hectares of cotton farms. Mulungushi Textiles was the life line of Kabwe as many businesses depended the company for survival. It is very be hard to imagine Mulungushi Textiles itself is one of the many dead factories in Kabwe, with its machines decaying in dust and workers sent home. The factory, formerly under the Defence Ministry of Zambia, was built with Chinese aid. It was inaugurated in 1983 after five years of construction financed by a 11.17-million-pound interest-free loan from the Chinese government Kabwe Business News (2010) describes the closure of Mulungushi Textiles with undercapitalization of the factory, similar to reasons for the first closure of the factory in 1996 (Koyi, 2006). The problem of undercapitalization was due to high costs of production, unfair
3 Research Paper Mulungushi Textiles competition, obsolete equipment, erratic supply of raw materials, failure of clients so settle debt, in addition to a bloated workforce (Kabwe Business News, 2010). Main Body The organisation must perform the global supply chain activities when needed at the right time, not earlier or later in the global supply chain. Prasad et al. (2001) & Prater et al. (2001) emphasise on the quick response to changes in the global environment. Although, efforts were made to attract investments to recapitalise, this was coupled with made by management and shareholders to revive the factory; this was not enough for the factory to remain in production (ibid). Koyi (2006) contends that, the Chinese investments in Mulungushi Textiles were presented as an intervention to revive a collapsed factory but was a case of systematic quota hopping. Mulungushi Textiles provided Qingdao Corporation with an export market for the produced goods through AGOA (ibid).

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