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Maeve O'Connell

Supervisors:

 Prof. Michael Morley

Working Title of Thesis:

Supplier Insertion into Global Value Chains: Insertion Capability Development in the Serbian agri-food processing sector

Abstract

While it is widely recognised that local firm participation in global production networks (GPN) provides a supportive environment for local firm capability development this is broadly predicated on the assumption that local firms have the basic requirements to access production networks (PN) in the first instance.  In certain industries, highly regulated to ensure the security of the supply chain, the initial acceptance criteria are more demanding thereby creating higher entry barriers for local suppliers. Prior research is centred on supplier upgrading inside the value chain with less attention on upgrading to achieve initial insertion. This thesis investigates how local suppliers’ capability development for insertion into PNs is facilitated by a combination of both firm and non-economic actors.  Using the GPN perspective it explores how variations in PN types (i.e. global, regional and local) influence the nature and content of the insertion capability assistance provided to local suppliers.  This research provides a balance to extant literature which is more focussed on the GPN type of PN.  The thesis explores supplier insertion capability in the context of a transitional economy, namely Serbia, focusing on the agrifood sector  A key aspect of this enquiry is how the ‘entry’ of a value chain  to Serbia, typically through the acquisition of an ex-SOE affected the network connection between the Lead Firm’s value chain node in Serbia with ‘aspirant’ suppliers  and the non-economic actors thus essentially the study the impact of network connection within Serbia post privatisation on the various actors’ ability to engage with each other to deliver/receive assistance.    

A qualitative multiple case study method is applied to develop three cases, each representative of a particular type of value chain.  Using the Serbian agrifood sector as a context, this study focusses on the ingredient and packaging suppliers to food processing firms (Lead Firms) with production facilities based in Serbia. 

This enquiry demonstrates that a key factor influencing insertion capability development is the whether or not the value chain node in Serbia (the acquired ex-SOEs) was given the effective steer to utilise or develop extant networks to support the insertion processes.  This study provides several contributions to GPN, international business and economic development literatures.  In particular it extends the scope of the GPN perspective backwards to incorporate the critical stage of insertion into the PN and also demonstrates the importance of considering variations in PN types.  In addition it broadens the non-economic actors’ role to include facilitation, emphasising the importance of dissecting non-economic actors to explore the individuality of their respective roles