International acquisitions and efficiency and productivity of the Serbian cement industry

Abstract

PurposeThis paper explores the impact of international acquisitions on the efficiency and productivity of the cement industry in an emerging economy.Design/methodology/approachThe data envelopment analysis (DEA) and Malmquist index (MI) are used to calculate the partial efficiency and productivity of individual inputs (materials, labour and fixed assets), as well as the total factor efficiency and productivity during the period 2000–2018. DEA and MI are combined with bootstrapping to perform succinct statistical inferences for determining the accuracy of results. In this paper we apply the input-oriented CCR DEA Window model. With respect to the level of analysis, data was collected from individual companies and then aggregated data at the industry level.FindingsThe research results show that international acquisitions positively affect efficiency of the cement industry in the long term. Efficiency of capital is lower in the short period after acquisitions. Additionally, international acquisitions positively affect partial productivity, as well as total factor productivity of the cement industry.Practical implicationsThe results of the study may be significant for managers and policy makers to design appropriate strategies for the improvement of the cement industry performance over time.Originality/valueResearch in emerging economies related to subject matter is limited, and this is one of the earliest research studies which explore change in efficiency and productivity at the level of Serbian cement industry.

Cross-border acquisitions and profitability of acquired companies in Serbian cement industry

“…In addition to this, there is a change in demand structure. Sales of traditional products (such as Portland cement) are stagnating, while the sale of new and innovative products (such as cement mortar) are on the rise (Savović & Marković, 2021). The rising amount of sold cement products boosted sales income of the cement companies, which grew from 20 billion RSD in 2008, to almost 26 billion RSD in 2020.…”

“…Consequently, the value of their ROS ratios increased considerably and reached the peak in the year before the Great recession. This increase was driven by a sharp employee downsizing (Savović & Marković, 2021), and a faster growth of employee productivity compared to the growth of cost of salaries . Implementation of the human resource management activities, such as communication and information flow, better defined training needs, employee empowerment, contributed to increasing employee commitment and, on that basis, increasing employee productivity (Grubor et al, 2020).…”

Assessing the productivity of Serbian manufacturing industry with Malmquist DEA indices

“…The Malmquist productivity indices have been used in many different analyses for years, including recent analyses related to some divisions of Serbian manufacturing industry (Savović et al, 2021).…”