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Munkombwe MadubekoModule 8 Research PaperOSM5122 / Global Operations ManagementDr. Raj Parikh8thNovember 2020.
2Research Paper Mulungushi TextilesIntroductionGlobal supply chain management has extremely gained reputation since the past decadesdue to a competitive business environment globally. Christopher et al. (2006) emphasizes the needto have supply chain designed for global operations and they argue that the choice of supply chainstrategy impacts competitive performance. Mulungushi Textile Joint Venture Ltd (MulungushiTextiles) used to be the largest textile company in Zambia. The company is situated betweenKabwe and Kapiri, about 15 km from Kabwe’s central business district, used to employ about2,000 workers and produced 1,800 tons of cotton yarn, 17 million meters of various fabrics and100,000 pieces of garments every year. Its two ginneries could process 20,000 tons of seed cottona year. It also has a refinery that produced about 600 tons of cotton seed oil. Mulungushi Textileswas also into cotton growing. Through 5,000 contracted farmers, it controlled 10,000 hectares ofcotton farms. Mulungushi Textiles was the life line of Kabwe as many businesses depended the companyfor survival. It is very be hard to imagine Mulungushi Textiles itself is one of the many deadfactories 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 in1983 after five years of construction financed by a 11.17-million-pound interest-free loan from theChinese governmentKabwe Business News (2010) describes the closure of Mulungushi Textiles withundercapitalization 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
3Research Paper Mulungushi Textilescompetition, obsolete equipment, erratic supply of raw materials, failure of clients so settle debt, inaddition to a bloated workforce (Kabwe Business News, 2010). Main BodyThe organisation must perform the global supply chain activities when needed at the righttime, 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 weremade to attract investments to recapitalise, this was coupled with made by management andshareholders 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 presentedas 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 goodsthrough AGOA (ibid).