This thesis contributes to the development of a critical understanding of business strategy of the Sri Lankan tea industry within a broad socio-cultural and political economy perspective. The insight coming from this thesis will enhance the understanding of the stakeholders of the industry, particularly the plantation managers, policy makers, and funding and training agencies, to develop more realistic and context-sensitive business strategies and management practices for the development of industry.
Tea is the major agricultural crop in Sri Lanka, contributing 2.4 percent of the GDP, and about 20 percent of the total employment. The industry has been the major contributor to the infrastructural development of the interior parts of the country. However, over the past 25 years, since the nationalisation of private estates by the government in the early 1970s, the sector has underperformed, causing a loss of scarce resources. Sri Lanka's share of the world's tea exports fell from 40 percent in 1970 to 16 percent in 2003. The industry also suffers with productivity that is almost 50 percent lower and cost of production about 25 percent higher than those of major competitors. In 1992/93, privatization of tea plantations and restructuring of the tea industry began, with the expectation of improving it by focusing on a Western/Northern business perspective. Since then, there has been no significant change in performance in the tea plantations. Hence, there is a great need to research the existing strategy process within its wider social and political contexts.
The main puzzle of this thesis is to critically examine the applicability of the Western/Northern business strategy ideology and approaches to the Sri Lankan tea industry, particularly tea plantation companies. This thesis therefore aims to explore the contextual appropriateness of the Western/Northern business strategy ideology in order to understand the peculiarity, strategic issues and factors of the Sri Lankan tea industry. There are two major components. First, desktop research was employed with some empirical work to update previous research issues and findings, and examine contextual appropriateness of the Western/Northern rationalistic approaches to strategy. Secondly, the cultural political economic realities of the power relations in strategy processes of the industry, particularly the tea plantations, were explored through a fieldwork approach grounded in ethnography.
Applicability of the Western/Northern strategy approaches and the power relations of the strategy process were explored through the actors' perspectives. An interpretation was given within the broader socio-cultural and politico-economic context. An ethno-methodology-based holistic case study approach were employed to capture the grounded perspectives of the people employed within the tea industry. Extensive fieldwork generated rich accounts about the two tea sectors, tea plantations and tea smallholdings. Mainly qualitative fieldwork data was analyzed using an iterative process that allowed themes to emerge in relation to the socio-cultural and politico-economic structures and realities. Critical strategic issues and factors were found as the emerging. They were: culture and politics in production; resurrection of a modem peasant production; panic in marketing; and global inequality. The critical strategic issues and factors revealed, particularly in the tea plantation sector, are outside the neo-classical and industrial economics perspective in which Western/Northern managerialist business strategy is rooted. It is apparent that tea industry actors are deeply embedded in, and profoundly influenced by, the socio-cultural, political and historical institutional practices inherent to the industry rather than working for change and development of the industry.
It was found that power relations in the industry strategy processes lie within ethno-politics, trade unionism, elitism, patriarchal labour and family structures and religious value systems. This is especially the case in the tea plantations. Therefore, it is suggested that understanding the power relations in strategy processes within a wider social and political context, will allow managers to make better decisions. Managerialist approaches hold some promise but quickly move toward prescription. Western-based strategy promotes instrumental rationality, reproduces hierarchical relations of power, and systematically privileges the interests and viewpoints of particular groups. A critical perspective-cultural political economy approach is proposed as an effective way to understand such a context before a rush for prescriptive strategies.
It is argued that strategy can only be studied effectively, and recommendations for improvement made, if there is a good understanding of the socio-cultural dynamics of the society. The indigenous caste system, British-derived education and class systems, current labour dominance of an idiosyncratic political landscape, and land ownership issues stemming back to pre-colonial times, are some of the factors flavouring business activities in Sri Lanka in the 21st century
It argued that strategic ideology and predominant prescriptive managerialism are inappropriate and inadequate in addressing the issues pertaining to the Sri Lankan tea plantation and the industry. Strategy can be viewed as a set of practices and discourses that promotes instrumental rationality, reproduces hierarchical relations of power, and systematically privileges the interests and viewpoints of particular groups. It is argued that in the majority of cases in this thesis, strategy processes based on the Western/Northern business strategy ideology and managerialist methodologies have not taken into account the unique socio-cultural, historical, and political interactions within organization processes in Sri Lanka as an underdeveloped economy.
Finally, this thesis suggests that true grassroots approaches to strategy such as labour empowerment, can segregate the asymmetrical power relations of the industry and tap the creative energy of workers while fostering effective strategies to enhance industry performance. In addition, the need for alliances with national marketers, branded products, Ceylon teahouses, coordinated policy with business, logistic management, R&D, international trade strategies, and training and development are suggested for the improvement of the industry.