Collective efficiency and collective failure: The response of the Sialkot surgical instrument cluster to global quality pressures

In: Nadvi , K 1999 , ' Collective efficiency and collective failure: The response of the Sialkot surgical instrument cluster to global quality pressures ' World Development , vol 27 , no. 9 , pp. 1605-1626 . DOI:10.1016/S0305-750X(99)00078-9

Abstract

One of Pakistan's rare examples of consistent export success has been the Sialkot stainless steel surgical instrument cluster. This cluster, consisting mainly of small and medium enterprises (SMEs), has as its main markets the United States and Western Europe. In recent years, access to these markets has become contingent on meeting international quality assurance standards. The hypothesis explored in this paper is that meeting such standards requires greater local cooperation, both among producers as well as between producers and their suppliers and subcontractors. The study draws on quantitative and qualitative data to examine how inter-firm ties, both vertical and horizontal, have changed. The evidence suggests that joint action has increased, but that there remain significant areas of collective failure. Thus, the quality assurance pressures mark a possible turning point for the cluster, raising questions as to whether local sources of competitiveness, captured in the collective efficiency concept, can continue to provide the basis for export success. It also leads directly to an evaluation of the cluster's growth trajectory.