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Competitive Advantage, Entrepreneurship and Strategy in the Global South: A Case Study of the Trinidad and Tobago Steelpan Industry

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The findings presented here were gleaned from research involving the conduct of first-hand interviews with major steelpan producers, administrators, industry suppliers, steelband leaders and researchers . The information gained from these and
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  COMPETITIVE ADVANTAGE,ENTREPRENEURSHIP & STRATEGY IN THEGLOBAL SOUTH  A Case Study of Trinidad & Tobago's SteelpanIndustry Chanzo O. Greenidge, PhDInstitute of International Relations, University of the West Indies Introduction The findings presented here were gleaned from research involving the conduct of first-handinterviews with major steelpan producers, administrators, industry suppliers, steelbandleaders and researchers 1 . The information gained from these and secondary sources wasthen analysed using Harvard strategist Michael Porter's model of competitive advantage, theso-called Porter Diamond. My study of the steelpan industry was launched with an implicithypothesis that Trinidad and Tobago, as the birthplace and virtual monopolist of theinstrument for over fifty years, would be able to benefit royally from the growing recognition of the instrument. In exploring the structure and trajectory of the global steelpan industry,however, I was led to conclude the opposite. Despite the international goodwill that the localindustry currently enjoys, current trends suggest that Trinidad and Tobago's leadership in thesteelpan industry will soon be supplanted by other countries whose resident firms arereducing the gap in competitiveness through concerted investment in product design,marketing, and human capital development.If the current trajectory of the industry continues over the next 7-10 years, Trinidad andTobago will not possess a significantly greater degree of access to the main sources of itscompetitive advantage, i.e. human capital and technological know-how, than its nearestcompetitors 2 . The study went on to investigate the causes of this decline, and to outlinepossible strategies for addressing the loss of competitive advantage in one of the country'sfirst indigenous industries.  Greenidge/Competitive Advantage 2  Admittedly, the earlier paper was targeted towards the steelpan industry and Trinidad andTobago in particular. However, it is the author's belief that the lessons learned from thefortunes of the Trinidadian steelpan industry can be used to inform the development futurestrategy for creating, and more importantly, sustaining competitive advantage in the GlobalSouth. These lessons have been grouped here under four (4) main headings: Creation: What processes are involved in the development of a source of competitiveadvantage? Loss: Why is competitive advantage diminishing in the case of the Trinidadian steelpanindustry? Location: Where or in what areas will the Global South most likely find competitiveadvantages? Sustainable Development: How can firms and countries in the Global South sustaincompetitive advantages once created? The Porter Diamond Before entering into a discussion of these four themes, a short description of the Porter model as well as the instrument and industry it has been used to analyse is in order. In hisseminal work, The Competitive Advantage of Nations (1990), Michael Porter is essentiallyRicardian in his conceptualisation of trade as the result of differences in factor productivity or comparative advantage. 3 Porter, however, also extends Ricardo's theory of comparativeadvantage by introducing neo-Schumpeterian concepts of product innovation anddifferentiation as the bases for sustained growth and international competitiveness. 4 Themajor analytical tool used in the preparation of the study, the Porter Diamond model of competitive advantage presents a diamond of four (4) interrelated factors as the measure of a country's capacity to support industrial or commercial innovation.  Greenidge/Competitive Advantage 3 These four (4) factors are:FACTOR CONDITIONS: The national store of resources and resource creation mechanisms.DEMAND CONDITIONS: The size and characteristics of domestic demand, including buyer needs and sophistication.SUPPORTING AND RELATED INDUSTRIES: The availability of various types of externaleconomies of scale through vertical and horizontal linkages.FIRM STRATEGY AND RIVALRY: The quality of business practices, culture and competition,both within the industry and nationally.The term 'Competitive Advantage' therefore refers to the relative capacity of nations tosupport the processes of innovation (research and development, product design, andmarketing) in a particular industry. Competitive advantage should not be confused with therelated, but distinct concept of comparative advantage, which refers essentially to the abilityto produce a commodity at a relatively lower average cost, while taking into account the(opportunity) cost of the commodity in terms of other alternatives. Steelpan Technology Inventor Thomas Edison once commented that "[t]o invent, you need a good imagination anda pile of junk." 5 This is an excellent synopsis of the emergence of steelpan technology. Theoverall steelband movement was forged out of the suppression by colonial authorities, via the1884 Peace Preservation Act, of the use of drums during the yearly Camboulay  festivities,the precursor to the present Trinidad and Tobago Carnival. This suppression led first to theuse of  Tamboo Bamboo  or bamboo drums as an alternative form of musical accompaniment.By the outbreak of the Second World War, scraps of metal and tin cans had also been pulledinto service as percussion instruments. It was these rudimentary innovations that led toeventual development of the steelpan, the only acoustic musical instrument to be invented inover a century. The contemporary family of steelpan instruments has a wide acoustic range,and is capable of rendering even the most complex musical arrangement.The conventional methods for steelpan production emerged from the observation that dentedmetal surfaces produce variances in pitch. In the first stages of manufacture, a flat steel  Greenidge/Competitive Advantage 4 surface is sunk to form a concave bowl. 6 Generally, the deeper the cavity made, the thinner the metal at the centre, and the higher the range of the steelpan. The hammering usuallyinvolved in this process deforms the steel, introducing small defects and dislocations of atoms into the structure of the metal, and thus alters its texture and sound. 7 In thesubsequent grooving process, the sections that will later be tuned into varying notes aremarked and the divisions between them indented to provide insulation against overtones. 8  Instruments are usually then heated at differing temperatures, about 150°C at the centre of the bowl compared with 315°C near the edges. 9 During heating, the steel, primarily acombination of iron and carbon, undergoes a process called s train aging  , where the carbonatoms in the steel collect around the dislocations produced during sinking and grooving.Strain aging results in a further hardening of the 'pan's playing surface 10 and raises thefrequency of the notes. 11  Note sections are then hammered and tapped upwards to produce convex surfaces, 12 as thetuner repeatedly taps the circumference of each section to adjust the pitch. This fine tuningprocess is performed by ear but can be complemented with the use of electronic tuningdevices or other instruments. 13 The complexity of fine tuning is matched only by itsimportance to the production process, as the final tonal quality and character of an instrumentdepends on the tuner's skill and approach. As could be expected, the tuning processrepresents the lion's share of production cost, accounting for between 36% and 51% of value-added. In addition, the conventional steelpan is very rarely player-tuned and 'pantuners are also required to maintain or restore the harmonic quality of the instrument. 14   The Steelpan Industry: Structure and Outlook Since the emergence of the instrument in the late 1930's, a collection of economic activitieshas spawned from steelpan production and play. For the purposes of the study, the steelpanindustry was divided into four (4) discrete but related sectors:  Performance and Recording  Instrument Production and Tuning  Educational Services  Event/Festival Tourism  Greenidge/Competitive Advantage 5 Over the past ten years, music educators in the European, North American and Japanesemarkets have discovered the advantages of the steelpan as an elementary teaching tool, andas such, recognition of and demand for the instrument has increased. At the same time,steelpan ensembles and solo recording artistes have enjoyed greater acceptance in themainstream markets of Asia, Europe and the United States. Partly as a result of thepreceding trends, the outlook is equally bright in the global market for musical instruments.Based on current industrial trends, further penetration and growth in this sector can beexpected in area markets such as:  West Africa (esp. Ghana and Nigeria)  Western Europe (esp. France, Germany, Holland, Italy)  Eastern Europe  South America (esp. Bolivia, Brazil and Venezuela)  East and Southeast Asia (esp. China, India, Singapore, South Korea, and Taiwan).Having provided an overview of the industry in question, an examination of the four major lessons to be gained from Trinidad and Tobago's performance within the global steelpanindustry will now be undertaken. Lessons Learned Creation: Community-based Innovation The first major insight to be gained from the steelpan industry in Trinidad and Tobago lies inan investigation of the processes that led to the development of steelpan technology itself.The steelpan instrument was developed and elaborated with very little capital investment, andevolved out of a community-based system of innovation that utilised other resources or advantages, especially human capital and the geographical proximity of researchers anddevelopers.
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