Abstract:
This research project aims to investigate and analyse the impact of the Covid-19
pandemic on the vertical boundary strategies of firms in the South African agricultural
sector (SAAS). It attempts to determine how firms have adapted to the disruption of
vertical supply chains during periods of deep uncertainty.
Vertical integration is regarded as a "paradigm" problem for explaining firm- and
market organisation in modern economics. Considering global dynamics and food
security concerns, SAAS should revisit strategic and economic practices. It is
essential to analyse how firms have adapted vis-à-vis disruption of vertical supply
chains during periods of uncertainty, considering empirical difficulties in developing
a theoretical account of these adaptation responses.
The research adopted a qualitative analysis approach, embracing interpretivism and
an exploratory, multi-case study strategy to identify and compare the insights
concerning vertical boundaries strategies of leading firms’ senior management. Indepth-,
semi-structured-, open-ended interviews were conducted, and secondary
data were collected to investigate three pertinent research questions.
A dynamic gears model was created to illustrate the value of three themes emanating
during the results' analyses: post-pandemic resilience, vertical boundary strategies,
and strategising vs economising. Principal findings aligned with the agent-based
model of Histen (2022), arguing that integrated firms better negotiate systemic
change and uncertainty. However, as uncertainty decreases, markets outperform
firms, indicating that dynamic interdependencies exist and vertical integration is
crucial in market expansion and firm existence. A theoretical timeline visualises
complex firm organisation within economic evolution, reflecting leadership’s strategic
and economic mindsets and affirming the argument by Williamson (1991) that SAAS
firms are not economically-, rather strategically focused.
