ABSTRACT

This study employs the “SWOT matrix” technique to formulate manufacturing strategies for the cassava industry in Nigeria. The motivation for the study is the seemingly wide gap between the supply and demand for manufactured cassava products despite the industry’s potentials in the area of abundant raw materials and high demand for its products. A strategic analysis was carried out on eight industries in Akwa Ibom state using “environmental scanning” technique. Data from strategic analysis was used to construct a profile of strength (S), weaknesses (W), opportunities (O) and threats (T) that influence the industry’s ability to achieve its manufacturing goals. The “SWOT matrix” technique of strategy formulation was then applied to analyze the profile and evaluate various strategic options that were generated by the interaction matrix to arrive at twelve strategies. Findings from the study show that government has a greater role to play in developing the manufacturing capacity of the cassava industry. Most cassava industries were also found to be operating below installed capacity due to lack of funds, erratic public power supply, irregular supply of raw materials, use of obsolete machineries, poor plant facility layout and below average managerial skills. The study recommended that modern cassava machineries such as the cassava-peeling machine be imported and redesigned by Nigerian engineers for local use. An alternative method of disbursing loans to cassava industries that emphasizes less on collateral was also recommended.

 

 

 

TABLE OF CONTENTS

Title Page        .           .           .           .           .           .           .           .           .           .           .           i

 

Certification    .           .           .           .           .           .           .           .           .           .           .           ii

 

Dedication.     .           .           .           .           .           .           .           .           .           .           .           iii

Acknowledgement.     .           .           .           .           .           .           .           .           .           .           iv

Abstract.         .           .           .           .           .           .           .           .           .           .           .           v

Table of contents.       .           .           .           .           .           .           .           .           .           .           vi

List of figures.                        .           .           .           .           .           .           .           .           .           .           viii

List of Tables.             .           .           .           .           .           .           .           .           .           .           ix

CHAPTER ONE:  INTRODUCTION

1.1 Background of the study. .           .           .           .           .           .           .           .           .           1

1.2 Statement of problem.      .           .           .           .           .           .           .           .           .           2

1.3 Purpose of the study         .           .           .           .           .           .           .           .           .           3

1.4 Significance of the study  .           .           .           .           .           .           .           .           .           3

 

CHAPTER TWO:  LITTERATURE REVIEW

2.1 The cassava industry:  Products, processes and machines.           .           .           .           .           4

2.2 Manufacturing concepts and the cassava industry.          .           .           .           .           .           7

2.3 Dimensions of  manufacturing strategy.   .           .           .           .           .           .           .           8

2.3.1 Internal dimensions of a manufacturing strategy.         .           .           .           .           .           8

1.Product concept, design and development. .           .           .           .           .           8

2.Manufacturing plants and facilities.            .           .           .           .           .           .           9

3. Manufacturing technologies and practices. . .           .           .           .           10
4. Logistics and material control. . .           .           .           .           .           11
5. Human resource management. . .           .           .           .           .           13
6. Organization and management systems. . .           .           .           .           13

2.3.2 External dimensions of  manufacturing strategy.          .           .           .           .           .           15

1.Competitive factors.                        .           .           .           .           .           .           .           15

2. External success factors . .           .           .           .           .           .           15

2.4  Manufacturing strategy formulation process.      .           .           .           .           .           .           16

2.4.1 Step 1: Strategic analysis.          .           .           .           .           .           .           .           .           17

2.4.2 Step 2: Strategic choice.                        .           .           .           .           .           .           .           .           19

2.5 Generation of options.                  .           .           .           .           .           .           .           .           19

1. Concentration or specialization strategy. . .           .           .           .           19
2. Innovation strategy. . .           .           .           .           .           .           19
3. Growth strategies. . .           .           .           .           .           .           .           19
4. Stability, do nothing, consolidation or no change strategy. . .           20
5. International strategy . . .           .           .           .           .           .           20
6. Retrenchment strategies. . .           .           .           .           .           .           21

2.6 Evaluating the strategic options.               .           .           .           .           .           .           .           21

2.7 The SWOT  matrix: A conceptual model.            .           .           .           .           .           .           22

2.8 Related empirical studies. .           .           .           .           .           .           .           .           .           26

2.9 Summary of literature review.      .           .           .           .           .           .           .           .           27

 

CHAPTER THREE: METHODOLOGY AND STRATEGIC ANALYSIS

3.1 Methodology.       .           .           .           .           .           .           .           .           .           .           28

3.2 Scope of the study.           .           .           .           .           .           .           .           .           .           29

3.3 Data and information sources for the study.        .           .           .           .           .           .           29

3.4 Area of study        .           .           .           .           .           .           .           .           .           .           30

3.5 Strategic analysis result     .           .           .           .           .           .           .           .           .           31

3.6 Summarizing strategic analysis result into a swot profile.            .           .           .           .           34

3.6.1 Identifying  strengths , weaknesses, opportunities and threats from strategic analysis            .           36

3.7   SWOT profile for the cassava industry  .           .           .           .           .           .           .           37

 

CHAPTER FOUR: SELECTION OF MANUFACTURING STRATEGIES

4.1  Strategies for the strength and opportunities (SO) segment.       .           .           .           .           39

4.2  Strategies for the strength and threat (ST) segment.       .           .           .           .           .           39

4.3  Strategies for the weakness and opportunities (WO) segment    .           .           .           .           40

4.4  Strategies for the weakness and threat (WT) segment    .           .           .           .           .           41

 

CHAPTER FIVE: RESULT, CONCLUSION AND RECOMMENDATIONS

5.1  Result       .           .           .           .           .           .           .           .           .           .           .           43

5.2  Conclusion.          .           .           .           .           .           .           .           .           .           .           44

5.3  Recommendations           .           .           .           .           .           .           .           .           .            45

Bibliography   .           .           .           .           .           .           .           .           .           .           .           46

 

Appendix I : Profile of Industries used for the study            .           .           .           .           .           .           51

 

Appendix II: Details of Strategic analysis      .           .           .           .           .           .           .           52

 

Appendix III: Analysis of interaction matrix of strategic segments  .           .           .           .           56

 

 

 

CHAPTER ONE

INTRODUCTION

 

1.1  BACKGROUND OF THE STUDY

With Nigeria as the current highest producer of cassava in the world¹, the Cassava industry holds high hopes towards the diversification of the nations industrial base from hydrocarbon(oil) which is non sustainable to a carbohydrate based economy that involves the conversion of renewable biomas  resources such as cassava into useful chemicals and fuel. Processed Cassava products in addition to being food for humans have gained significant recognition as a source of raw materials for livestock, textile, chemical and plastic production. As at the last count, about 2500 products can be derived from the cassava crop². It is also reputed in the Food and Agricultural Organization (FAO) document¹ as having more utilization than any known crop.

Technically, Nigeria could be a world market leader in cassava products as climate, market, high yielding varieties, planting materials, human resources, capital availability and infrastructural adequacy are known and available³.  Processed Nigerian cassava products have also gained an improved patronage in the international market.   If government sustains its present policy of discouraging import, the increased demand for processed cassava products for export will continue. Thus, there is an increased potential of the cassava industry in terms of industrialization, expansion, modernization, poverty reduction, creation of wealth and job opportunities at the grass roots and reduction in rural urban migration.

With such immense potentials, the cassava industry vis-à-vis its manufacturing functions, if properly managed and developed using suitable strategies could lead to rural industrialization and improve the industrial base of the nation. It will also create employment, supply raw materials to other industries and improve the economy. More investors and entrepreneurs are therefore, required in the establishment of cassava industries and manufacturing of processed cassava products for export to sustain this tempo. Some progress has already been made in this direction. For example, Nigeria intends to establish 500 cassava-processing plants nationwide². Kogi State government in partnership with a Chinese firm also plans to establish a cassava ethanol fuel factory in Kabba, Kogi State, a development  the Nigerian Television Authority (NTA) described in its 9p.m national network news of Sunday,   April 15, 2007 as a “revolution in the marriage of agriculture and energy”.

With this trend, there is also need for proper documentation of research findings and dedicated publication of reading materials on the cassava industry and related issues cutting across all interests.  Nweke,⁵¹  asserted that “most  researches on technical themes in the cassava industry are mostly concerned with such issues as processing and utilization, technologies for storage and design of various machines used in the cassava industry.  but not much work has been done on the manufacturing strategies for the industry so as to cub the wide gap  that continues to exist between the supply of and demand for processed cassava products’’.  Thus, the cassava industry stakeholders are denied the necessary guidance on adequate manufacturing techniques. They therefore continue to rely on outdated and crude manufacturing methods which results  in high cost of production, low quality products, low capacity utilization, high cost of products and continuous importation of cassava products into the country at the detriment of the economy. It is this disturbing trend in the cassava industry that has motivated this effort at “formulating a manufacturing strategy” for the industry.

 

1.2  STATEMENT OF PROBLEM

Despite improvements in manufacturing efficiency over the years, production of cassava to near real time demand is easier said than done⁴. Thus, the Nigerian cassava industry with it’s great potentials is yet to be transformed from its present subsistent state to a large-scale industry, capable of providing adequate job opportunities and products to meet internal consumption and export. What is on ground are incidences of glut, low quality products, poor producer prices and low productivity which have become its permanent features. The perennial underperformance of the cassava industry despite its potentials and efforts by the government and private sector at once highlights an intriguing lacuna.

Traditionally, manufacturing is important for the success of any company and a flourishing production system is a requirement for the socio-economic, political existence and rapid industrialization of a country. Skinner⁵, asserted that manufacturing process in many industries has been put aside in favour of financial and marketing influences.  Hill⁶, also claims that if a company is to succeed, there must be a clear-cut manufacturing policies or strategies. In this perspective, manufacturing strategies are necessary for a company’s competitiveness and survival⁷. A manufacturing strategy is therefore the fulcrum from which accelerated industrial growth can be leveraged.

The continuous failure of the government, her institutions, the public, and private sectors to articulate the potentials of the cassava industry through suitable manufacturing strategy could continue to be the cassava industry’s undoing. Consequently, the need for the formulation of a manufacturing strategy for the cassava industry in Nigeria constitutes the problem this study intends to address.

1.3  PURPOSE OF THE STUDY

The purpose of this study is to help accelerate the development of the cassava industry by formulating a manufacturing strategy that can be used to guide and manage its production functions, realize its abundant potentials and spur rural industrialization in the country.

1.4  SIGNIFICANCE OF THE STUDY

This study is expected to benefit all the stake holders in the cassava industry particularly the academics, government ministries and parastatals such as; the Ministries of Industry, Agriculture, and Commerce, farmers, cassava entrepreneurs, engineers, industrialist and managers.

Thus, results from this study:

• Will contribute to existing knowledge on the cassava industry and as a resource material for subsequent studies
• Will form the basis for policy formulation, review, and implementation
• Will aid the engineers in the intricacies of managing and facing manufacturing strategy formulation challenges
• Will guide the farmers, industrialists, investors, cassava entrepreneurs and managers in the establishment, management and operation of the manufacturing function in the cassava industries

 

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