donovan value chain_conference_2012
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Review of guides for value chain development, by Jason Donovan (ICRAF)TRANSCRIPT
Review of guides for value chain development
“Making the connection: Value chains for transforming smallholder agriculture”
6–9 November 2012 - Addis Ababa, Ethiopia
Jason Donovan
ICRAF
Setting the stage
VCD forms key element of strategies for spurring economic growth and addressing rural poverty proliferation of guides for VCD
Key elements of VCD are still evolving:– concepts: value chain, governance, pro-poor– methodologies: rigor, depth, scale, learning
Limited debate on the design of VCD guides– rigor / depth vs. user friendliness – specialization vs. all-in-one solutions– design issues vs. implementation problems
A review of VCD guides
11 guides selected
Areas covered in review: objectives, market focus, and assumptions
definitions VC and VCD
recommendations for data collection and analysis
user friendliness and adaptability
recommendations for M&E
originality, innovation, strengths, limitations
3-stage review: 1) coauthor, 2) authors of the guides, 3) external review
Portfolio of 11 guides
Definitions for chain and VCD
Chain definitions – lots of variation! – VC, market chain, market system, agrifood chain
– 2 types of definition: activity focused, actor focused
– most guides consider a chain to include all actors that comprise a subsector, despite the variation in scale applied in VC projects
VCD definitions – bit more consensus– World Bank: building mutually beneficial business links
– CIP: improved chain relations (innovation, trust)
– CIAT: developing strategic partnerships / networks
– IIED: integrating smallholders into modern markets
Users, objectives and assumptions
All guides designed for use by non-researchers, often projects, NGOs, and government agencies
Outputs from implementation: strategy for VCD
Development objective: Most guides ultimately aim to stimulate economic development and reduce poverty
But… limited discussion on how VCD is expected to contribute to poverty reduction no impact pathway
General assumption that smallholders have the assets needed to invest in VCD and don’t face major trade-offs related to the investment of assets
To what extent do diversified rural livelihoods allow smallholders to participate in and benefit from VCD?
Chain selection Careful chain selection matters:
– Sustainability of interventions– Inclusion of poor
Most guides include discussion on chain selection:
But… most guides provide: – incomplete set of parameters for selection – few examples of how to collect and assess data – limited discussion on costs/benefits of chain selection
Selection lead by local stakeholders
Selection lead by outside experts
Assumption that chain has already
been selected
2 6 3
Data and analysis collection at different levels
Level of data
collection
Level of attention given to data collection and analysis (n=11)
No attention Basic High
Intra-household
10 0 1
Household 4 4 3
Enterprise 4 3 4
Chain / market
0 2 9
Service provider
1 10 0
Household and enterprise-level data collection
Households FAO: input availability, production costs, production
technologies, management practices CIAT: role in VC, problems with production, marketing,
gaps in service offer UNIDO: potential risk scenarios, options to eliminate,
manage or mitigate potential risk
Enterprises M4P: identification of bottlenecks, analysis of costs and
margins, estimate of income and income variability, employment generated
ILO: strengths and weaknesses for VC participation, working conditions
Open questions about smallholders and VCD
What investments are needed for different types of smallholders to participate in VCD?
What interventions are needed before VCD?
What should be done with the most vulnerable – those that are not “VC-ready”?
What are the risks? How do mitigate them?
How to identify and address potential tradeoffs for VCD?
Open questions about collective enterprises and VCD
Can enterprises effectively respond to the demands of buyers and members?
Are they economically viable?
What investments are needed to increase viability?
What investments can be carried out with internal resources?
What combination of support services are needed? Are they available?
Data analysis
Strong focus on participatory analysis of problems and solutions – helps build collaborative base for VCD– but…limited attention to validity and reliability
of qualitative information
Lack of tools for assessing risks, trade-offs, investment returns
Few guides suggest the possibility of variation in the population of stakeholders
Quantitative analysis is side-stepped by most of the guides
Flexibility and guidance in application Pre-conditions for implementation
– market focus (local vs international): none – business environment / history: yes – chain-actor capacities: sometimes– chain type: none
Altogether limited options for designing more tailored VCD strategies
Many guides provide examples of successful implementation
…but few guides discuss pitfalls in implementation or present a fully-developed case studies
Monitoring and evaluation
Roughly half of the reviewed guides provide no discussion of M&E for resulting VCD strategies
Among those that address M&E, a basic set of indicators are provided for assessing changes at the level of enterprise and household
– income generated, new product lines, productivity, investments
Only GTZ and USAID discuss attribution
Guides not designed to provide a full treatment of M&E in the context of VCD
Emergence of specialized guides: 5Capitals, DCED
Conclusions Guides provide an innovative framework for
understanding markets and engagement with actors
But, need for more tailored strategies: based on context and local needs & interests
Need for increased attention to critical VCD issues: investments needs, investment sources, potential returns, risks, tradeoffs, vulnerability, gender equity
Issues too complex for any one guide: VCD toolbox
Conceptual frameworks are too simple – impact pathways are nonexistent
Urgent need for critical reflection, debate & collaboration for moving forward
Recommendations
For authors: Place greater attention on the needs of the poor Provide guidance for addressing critical contextual
elements (market reach, exiting capacities) Address head on the difficult aspects of VCD
design and implementation (promote learning!)
For funders: Support research & learning for understanding
how VCD contributes to rural poverty reduction Encourage innovation in concepts & tools for VCD Foster debate for improved design and
implementation of VCD guides
