GROOVE MARKET FACILITATION MENTORING PROGRAM AN INITIATIVE TO BUILD STAFF CAPACITY IN MARKET FACILITATION T OP ICA L GUIDE : A D D R E S SIN G M A R K E T O PP ORTUNITIE S T H R OUGH I N FO R MATION -B A SE D D E C ISI ON MA K ING The purpose of this topical guide is to support you in making information-based decisions to take advantage of continued market trends and opportunities and a dynamic value chain system. The term, Information, in this case refers to explicit information such as the kind typically gained through a monitoring and evaluation (M&E) system, formal research or analysis of market trends. It also means tacit information such as the kind often picked up through observation and personal experience. This topical guide provides definitions of these information types, an overview of the sources you can rely on to obtain this information and a number of tools and processes that you and your team can use to ensure the information is available and incorporated into your ongoing value chain development and facilitation work. As information gathering and use is a broad concept, this topical guide places particular emphasis on three areas commonly neglected by projects, two at the macro-level end market information and market trends and one at the micro-level field staff observation. Throughout the topical guide, you will be asked to reflect on your own abilities to use M&E and market research tools as ongoing methods of ensuring your solutions and interventions are on track. O V E R V IE W In this topical guide, the stage is set with an outline of the various information gathering sources using the categories of explicit and tacit information. This is the foundation for your understanding of the development and use of an effective knowledge management system for your project to succeed. In the second section you will learn about the variety of tools and research methods you can use to collect and analyse data, as well as gain knowledge and information that helps you facilitate value chain approaches. Though you will use information from many sources about many different aspects of the project, this topical guide is structured around three specific information areas, in part because each of them is commonly overlooked by traditional M&E systems but they are each vital to successful value chain projects: a) End Market Analysis Market Analysis focuses on understanding end-market context, channels, customers, competition, choices and communication to help guide project decisions. The topical guide provides an overview of end market analysis tools. b) Market Trend Analysis - Market trends significantly affect the way competition is structured within the entire value chain and the ways in which it evolves and changes. There are a number of components of the value chain which are key to the competitive process. You will review these components, and follow four steps to using market trend analysis to guide decision making.
c) Market Observation - In dynamic contexts, changes are rapid. Taking advantage of short feedback loops is essential to ensuring project interventions remain relevant to a wide-range of market actors. By better engaging field staff in M&E, managers are able to more rapidly understand what is working and what is not on the ground. This topical guide provides an overview of ways to formalize market observation so teams ask the right questions and generate actionable information for improved project performance. Each of these areas represents an information source and information gathering practice that should be included in an effective knowledge management (KM) system for a value chain project. The last section of this topical guide discusses how value chain project KM systems can be structured and some key concepts including the formation of learning loops. The professional skills focus is on planning for action, which present some techniques that enable managers to prioritize the information they have gathered. --------------------------------------------------------------------------- Topical Guide Terminology: Within this topical guide, you will see the following terms referenced. Review the descriptions below and ask your mentor if you have any questions on how these terms are used in value chain programming: Explicit Knowledge and Information: This is factual, quantitative data and research that is clearly articulated and accessible. Often gained from a project M&E system. Impact Assessment: A type of evaluation which provides an analysis of whether project objectives (outcomes and impacts) were achieved and can be attributed to project operations. It does this by establishing what would have happened in the absence of the project i.e. the use of a counterfactual or valid control group. Knowledge Management: The process involved in the management of identifying, creating, representing, distributing, and enabling learning from information within an organization, so as to make it accessible and applicable to further organizational or programmatic goals. Learning Loops: The types of learning and their relationship to decision making in organizations and projects. Largely from the works of Argyris and Schon (1996), they are usually referred to as single-loop learning, double-loop learning and triple-loop learning. More details can be found in Step 4 of this topical guide. Market Research: Information gathered (on a value chain) to inform program design and implementation decisions. It includes research gathered on all parts of the value chain using primary and secondary sources, as well as on the end markets for products or services of program clients, the enabling environment and related socio economic issues. Monitoring and Evaluation (M&E): Consists of performance monitoring and evaluation (project evaluation and impact assessment see definition above). Performance monitoring involves the tracking of project outputs and outcomes as indicators of project effectiveness, or the extent to which the project achieves its stated objectives. Project evaluation is project implementation as measured against the project's scope of work, deliverables, personnel requirements, etc. Primary and Secondary Research: Refers to the sources of information for your market research. Primary sources are those such as interviews, focus groups or stakeholder meetings
where information is obtained directly from a value chain player. Secondary resource is market information that is gathered from publications and other existing sources of data. Tacit (or implicit) Knowledge and Information: This is unconscious and intuitive information that is gathered and often picked up through observations and experiences. Value Chain Facilitation: Temporary actions or activities within a value chain that permanently overcome constraints, as well as, stimulate the value chain to develop and grow.
L A T E ST RE SE A R C H USAID Knowledge Management System microlinks Wiki http://apps.develebridge.net/amap/index.php/knowledge_management_system 3 pages Summary This short fact sheet provides a summary of the elements that are needed in a knowledge management system during program implementation. It briefly describes the various types of information that can be captured, as well as, where that information is located such as organizational structure, teams, staff meetings, quarterly and annual reports and evaluations. It also touches upon managing knowledge and learning loops which assist in implementing a value chain facilitation approach within dynamic market systems. A link to an example of a project on agriculture for empowerment of children is provided. MEDA Market Research for Value Chain Initiatives, Information to Action: A Toolkit Series for Market Development Practitioners 207 pages Summary A practical guide to conducting market research for value chain development programs - whether in the initial environmental scan, design or implementation phases of a project or program. It focuses on the how-to of designing effective market research, choosing information collection tools (Key Informant Interviews, In-Depth Interviews, Market Observation, Focus Group Discussion, Stakeholder Meetings, and Action Research), implementing those tools and organizing the resulting information. It also offers practical advice, examples, worksheets and case study applications. Of particular interest is the Market Observation Chapter pages 97 to 100 and Action Research pages 157 to 163. USAID End Market Research Toolkit: Upgrading Value Chain Competitiveness with Informed Choice 70 pages Summary A comprehensive tool kit that focuses on the market demand side of value chain analysis. It subdivides the market research process into two phases Phase l: Secondary End-market Research and Phase ll: Primary End-market Research. To facilitate decision-making, the actual analysis is structured around the Six C s Choice, Context, Channels, Customers, Competitors and Communication. It provides an overview and structure to the process, a menu of tools and reason for use in information gathering and analysis for each phase and case study application. Tools include: Diamond of Competitive Advantage; Porter s 5 Forces analysis; Value Chain Waterfall; BCG Matrix- Importers and Exporters; Double Loop Learning,; Survey; Interviews; Focus Groups; Spider Diagram; Cost, Quality, Flexibility, Service Analysis; SWOT Analysis; and various communication tools. Questionnaire, survey and focus group guides are included in the appendix. Mentee Reflection As you look at some results in the piloting and learning phase of your interventions, what tools or processes do you have in place already to ensure you are collecting the information needed to make changes or decisions in your project facilitation?
S T E P B Y STEP GUIDE Implementing and managing a market facilitation approach to value chain development is dependent on structures that actively push information from the ground (field staff) up to management and then back down to field staff. In this process, staff at all levels must be empowered to take on ownership of this and incorporate new learning back into efforts to adjust ongoing facilitation activities and interventions 1. This practice involves managing knowledge in a learning-based operating culture and requires continued market research, quantitative and qualitative data tracking, and management in dynamic environments. 2 In this step by step guide you will reflect on how to manage information and address market opportunities that arise during implementation. There are three steps you will walk through in this section: 1. Information Gathering Throughout Project Implementation 2. Select Appropriate Tools and Applications 3. Managing Knowledge and Learning Loops 1. Information Gathering Throughout Project Implementation Markets are dynamic and as you implement your project using value chain facilitation methods, you will find a range of challenges as you collect, analyze and use information required to achieve your project objectives. Developing and using a knowledge management system that can deliver both the reporting requirements and knowledge of behavior change (including taking advantage of market opportunities) to affect project implementation decision requires a combination of data gathering and capturing techniques and staff management methods. 3 There are two basic types of information that you need to capture - Tacit Knowledge or Information and Explicit Knowledge or Information. Tacit Knowledge in value chain projects refers to information that is a result of someone observing and learning. It is often unconscious, qualitative and intuitive information. It comes from the organizations operational culture, working on activities in team units, staff conversations to project exchanges, internal workshops or regular staff meetings. Explicit Knowledge is the type of information Ethics in Information Gathering and Research Information should always be obtained in an ethical way that respects those from whom you are gathering the data. A number of behaviors should be adhered to such as: Be respectful of cultural norms; Be transparent by explaining to all interviewees who you are and why you are conducting research; Manage the expectations by not promising any specific outcomes from your research that is not certain of happening and clearly articulating the purpose; and Share your results, as this honors contributions and provides an additional opportunity for feedback on your analysis. 1 USAID Knowledge Management System, microlinks Wiki http://appsdevelebridge.net/amap/index.php/knowledge_management_system 2 USAID Facilitation, microlinks Wiki, http://apps.develebridge.net/amap/index.php/facilitation; 3 USAID Knowledge Management System, microlinks Wiki, http://appsdevelebridge.net/amap/index.php/knowledge_management_system
that is captured in monitoring and evaluation activities and often is quantitative. It can include data from tracking results over time, quarterly and annual reports, formal evaluations or further market research and impact assessments. In addition to these sources of information, there are also a number of market research tools that can be used or revisited during implementation. These can provide more real-time knowledge to understand if the constraints are being overcome, you are accomplishing your project goals, and are not missing any market opportunities. We will look at these in the next step of this topical guide. 2. Select Appropriate Tools and Methods It is necessary to gather information about the various dimensions of a value chain both in the initial stages of project development and during the project implementation cycle. This means continually gathering information on such things as: the relationships within the value chain; information flow between the value chain actors and changes in their behavior; support market products and services; business and socio-economic environment; business performance of the various actors; and end market dynamics. End-market opportunities are constantly changing and evolving in value chains. Ongoing market research and analysis is an often overlooked area of information during project implementation. Conducting periodic market research provides you with the level of effort and details that should be put into understanding all aspects of the value chain in which you are operating. Therefore, you can make good decisions based on the entire value chain not just areas in which you may be directly intervening. In particular, this means keeping an eye on the various components of the value chain such as the context, channel, customer, competitors and communication. This is especially important when using a value chain facilitation approach, as these are dynamic components and can change with market forces. This will enable your team to make informed and timely choices, decisions and actions over the course of your project. In addition to the general areas of information capture we discussed in Step 1, having an assortment of market research tools that you can use to gain knowledge of real time behavior change in the value chain is critical. Below is a suggested list of tools that could be used or revisited, along with the knowledge you are gaining from official data tracking and monitoring methods and project meetings. These tools can be incorporated into formal evaluations or as part of small group workshops. Detailed information on these can be obtained in the USAID End Market Research Toolkit listed in the above section on Latest Research. In addition, Figure 1 includes various research tools and other knowledge capture methods. While you would pick and choose what is appropriate for your project knowledge, all of these are at your disposal to gain information to help track your value chain project efforts to achieve its goals. Figure 1: Summary and Adaptation of USAID End Market Research Toolkit Tools for End-Market Research and Information Gathering 4 Components Description Key Tools or Methods Context Basic understanding of challenges facing the value chain internationally and Diamond of Competitive Advantage Five Forces Analysis 4 USAID End Market Research Toolkit: Upgrading Value chain Competitiveness with Informed Choice, Nov. 2008
Channels Customers Competition Choices Communications domestically Intermediaries and partners within the value chain who purchase and distribute the industry s goods and services to the end-market Understanding customer needs is critical and can assist in producing important product attributes Understanding the firms and countries with which the value chain is competing for market share Important to identify key competitors and their actions and benchmark performance With the research from the above areas of context, channels, customers and competitors make clearly informed business decisions about the value chain with the most potential within the sector/industry or momentum and leverage in order to apply project implementation learning, changes and/or scale-up Involving value chain actors/stakeholders in the research design, information gathering and analysis, implementation, learning and replication is critical to effective interventions and solutions Value Chain Waterfall Market Mapping Market Observation Seasonality Analysis Interviews and Focus Groups Boston Consulting Group (BCG) Matrix Importers (product mix) Trends Analysis on selected value chain Boston Consulting Group (BCG) Matrix Exporters (product mix) Spider Web Chart Cost, Quality, Flexibility and Service Analysis Consolidated information from interviews, focus groups, staff discussions and meetings Annual and quarterly reports Targeted evaluations Impact Assessments Shaded Grid Analysis SWOT Analysis Double Loop Learning Trade Shows Buyer Videos Focus Groups and Stakeholder Meetings Again, please note that you would not use all of the above tools, but rather a selection based on your specific needs. See Figure 2 for some tool selection guidelines. It would be important to pick and choose these tools depending on where there are information gaps and other information that would have been collected through the regular knowledge capture. Also, many of these tools have an analysis Figure 2: Tool Selection Guidelines method built right in and this is a critical process to have at hand in order to push this new learning back into efforts to adjust ongoing facilitation activities. Step 4 will focus more on how to incorporate this information into learning processes in your project. You will notice that a number of these tools are the basic ones you first used during market research in the design and solution development phases of your value chain work. Using market research tools and applications can continue throughout the life cycle of your project in order to gather information for decision making such as revisiting solutions, interventions and ensuring you are meeting your project outcomes and impacts.
Let us focus in more depth on two of the tools mentioned in the above table - Market Observation and Diamond of Competitive Advantage Market Observation is highlighted in the Channels section of the above table. It can be used at any stage of knowledge capture or market research to contribute to your information gathering and decision making. A very cost effective tool, Market Observation is helpful in understanding transactions between enterprises in the market channel, especially to determine areas of potential conflict or weak performance. It also assists in drilling down in the information collection process. See Figure 3 for tips for Effective Market Observation. The tool works best if there are a team of two observers who observe the same series of transactions and immediately discuss what they saw to ensure that facts and perceptions are not at odds. The results are then recorded and the team would move on to the next transactions. Ensure that you plan your research questions or guides for observation before you begin. Use these example questions, and of behaviors to watch for as a starting point: Who are the buyers and sellers? Are they men, women or both? Do the transactions appear to be based on price, quality or a combination of the two Do buyers and sellers demonstrate respectful behavior towards one another How is the price determined? Is there negotiation for price? Are international prices considered? Are there any services included (or embedded) In the transactions such as transportation or advice on quality or input supplies? What are the product characteristics observed during purchase? Figure 3: Tips for Effective Market Observation Your market observation may take place in multiple locations and involve a range of buyers and sellers encompassed in the value chain. For example, it could be: producers and traders at a site of production; retailers and consumers in the market setting; wholesalers and buyers in wholesale market; producers and input suppliers at a supply outlet. They may also be either anonymously conducted or prearranged with one or both parties. There are pros and cons for each (highlighted in the table, below). Observation Type Pre-Arranged Market Observation Anonymous Market Observation Advantages Comfortable for attendees Taking digital photographs easier to manage (for observation purposes) Notes are allowed More authentic Less intrusive Disadvantages May invite misleading behaviors as value chain actors are aware they are being observed Potentially unpredictable (length can vary) Note taking not possible
More market observations required to confirm findings (as notes cannot be used) Several instances of each type of transaction required when observing to build sufficient understanding of how they work A general rule is to keep observing until you have answered the research question and are not uncovering new information. It is also helpful to take the data captured on actual observations and assess against expected observations. Each individual observer needs to record their information on a data collection sheet, noting: The type of enterprise and entrepreneur Description of situation observed Product characteristics Date & time Research questions Corresponding information gathered on those questions Other comments, observation, questions raised Follow-up ideas A data collection worksheet is attached, as a template for your use. This is one of a number of Market Research tool templates that can be found in MEDA s Market Research Toolkit, which is summarized in the Latest Research section of this topical guide. 5 Being aware of the global context and trends is also an important component in understanding endmarket opportunities. Globalization trends have shifted the central points of competition to the entire value chain or industry. Keeping an eye on these trends is also important knowledge management in value chain facilitation. This means that in order to participate in the higher value domestic and international markets, a micro or small enterprise must be able to get a product or service to customers at a price, quality or uniqueness that outperforms its rivals. It calls for systemic competitiveness since industries in one country must compete with industries in other competing countries. To recognize this, you need to focus on the value chain factors that enable small firms to compete in global and regional markets. These include: Enabling Business Environment the international, national, public and private policies, regulations and standards, informal norms such as class and gender Horizontal and Vertical Inter-Firm Linkages groups of suppliers working together to deliver products for a large buyer or linkages between large and small firms in the channel Upgrading innovation to add value to the MSE s products or services and to make production and marketing processes more efficient 6 Dynamic Support Markets thriving business services like input and production services, finance, accounting, legal inputs or information and communication technologies (ICTs) 7. 5 Miehlbradt, A. & Jones, L. MEDA Market Research For Value Chain Initiatives. Information to Action: A Toolkit Series for Market Development Practitioners, December 2007 6 USAID microlinks, http://aps.develebridge.net/amap/index.php/upgrading
To put the above learning into practice, follow these four steps: a) Identify what you want to know about the value chain as it relates to domestic, regional and international context. Then identify how and where you will locate that data. In the case of global context and trends, this usually is done through a combination of secondary and primary research. b) Review secondary information sources. This includes information that is available from relevant agencies such as: government (bureaus of statistics, ministries); business and industry associations (chambers of commerce, trade associations, marketing companies); multi-national bodies (United Nations agencies, the World Bank); Universities; Not-for-Profit organizations; and networks, in reports, journals, websites and other publications. It helps provide the context, background information and statistical data about the geographic region, an industry, its international competitive position, target populations, production, volumes exports and import trends. United Nations website, Publications The World Bank, Research MicroLINKS (Microenterprise Learning, Information and Knowledge Sharing) c) Conduct Primary Research. This could be done in one-on one interviews or group discussions with value chain players. It can be inserted as part of a formal evaluation or a separate staff team or workshop focus. Example: In the case of understanding the context (as outlined in Figure 1) you are looking to gain knowledge about the challenges facing the value chain and to get a better sense for the international competitiveness. There are several tools you could choose, but the one that will be most helpful in understanding determinants of international competitiveness is the Diamond of Competitive Advantage tool. Using this tool you look at four components and they include: the areas of resources and attributes that provide a competitive advantage (Factor Conditions), domestic competition (Demand Conditions), other key support industries (Related & Supporting Industries or Clusters) and activities that promote competition and strong local rivals (Firm Strategy, Structure and Rivalry). You will need to find out the answers to some research questions now, for example: Strategy How many other domestic competitors are there for this end-market? What are the price points and is there a difference? Factors 7 USAID, Trade, Micro and Small Enterprises and Global Value Chains, February 2005
How do the soil, climate and other natural resources provide an excellent growing condition for the product? Is labor easily accessible? How accessible is finance and capital for this product? Are there infrastructure challenges (i.e. roads, air, electricity, processing and communication)? Cluster Are there other accessible support services such as finance, research and development, and transportation? What role do donor agencies and government play in support of these end market products? Demand What is the domestic demand how much is produced and how much is consumed? Is there competition from imports, where are they from and what are the price points? d) Populate Research Data from Secondary and Primary Sources in Selected Tool & Analyze. In this example we are applying the Diamond of Competitive Advantage tool. Below is a summary of this tool, using the Afghanistan Dried Fruits and Nuts value chain as a case study. Figure 4: USAID End Market Research Toolkit Diamond of Competitive Advantage Tool 8 8 USAID End Market Research Toolkit. Upgrading Value Chain Competitiveness with Informed Choice, November 2008.
In reviewing the tool, you will see it shows that although factors were relatively positive and there was a high demand), the industry was weak in the areas of strategy and cluster in terms of lack of infrastructure, reliable electricity and roads, and limited domestic rivalry. This type of analysis can be used as a benchmark and provides a comprehensive view of strengths and weaknesses of the international competitiveness of the value chain. 3. Managing Knowledge and Learning Loops Managing the knowledge that your project collects requires an intentional system to be in place to gather, disseminate and apply the learning to improve your organizational or project goals. As such, knowledge management (KM) is a complex mix of processes involving, not just one or two, but a number of research and knowledge capture tools and methods. In the previous section we illustrated the importance of including tools for end-market analysis, market observation and information on global market trends in your knowledge management system to improve your value chain interventions. There are many other types of information that should also be incorporated into the KM system, such as number of beneficiaries reached, increase in incomes and other monitoring and evaluation information. This data will only be as beneficial as the processes you set up to analyze and push the new learning back into your ongoing value chain facilitation approaches and activities. Your project should create management processes that intentionally apply learning loops from all of your interventions. This is particularly important in value chains since market systems can change quickly and your program must be able to respond to these. Learning loops identify a Figure 5: Example of a Knowledge Management System process that shows the relationship between the type of learning and decision making in organizations and projects. Largely derived from the works of Argyris and Schon (1996), they are usually referred to as single-loop, double-loop and triple-loop learning. Single-loop learning is about following the policies and rules that are in place and keeping within those rules. Learning comes when errors or deviations are identified, feedback is given about those or the gaps identified, decisions are made and actions taken to correct them. It typically involves learning how to do things better. In Double-loop learning project members reflect on whether the rules themselves should be changed. It is much more demanding and involves more creativity, questioning and critical thinking. As an example, if a farmer changes to biological farming from applying traditional
fertilizers and pesticides, he will have to learn how to deal with this new method. A third type of learning is called Triple-Loop learning and it is essentially learning about learning or questioning the current methods and forms of feedback through which learning in a project is organized. To use a farming example again in this type of learning a farmer may discover he or she is noticing animal health problems too late and therefore may search for new routines of observation and registration that improve feedback and learning on the health condition of the farm animals. 9 You will want to take your various sources of knowledge and information you have captured from your initial project activities and research (Steps 1, 2 & 3 above), then feed them back into a learning loop or process that can drive follow-on interventions within the context of addressing market opportunities, achieving project goals and improving value chain actors performance over time. An example of a project learning loop and knowledge management system is illustrated in Figure 5. 10 As you develop the knowledge management system for your value chain facilitation activities, keep in mind the following key components that will be necessary for an effective learning loop: o An organizational or project operating culture that fosters active observation and honest discussion of progress. o Multiple methods of knowledge and information capture that uses both tacit and explicit information sources. o Flexible project management to follow-up and push momentum that encourages behavior changes required to take advantage of market opportunities and improve value chain performance. Using information effectively is not an isolated incident; it is routine, intentional and part of the operational culture of your project. If you do not have it, by the time you realize you need it, it will be too late and you will miss the market opportunity. 9 Leeuwis, C., Communication for Rural Innovation Rethinking Agricultural Extension, Blackwell Publishing, 2004 10 Agriculture for Children s Empowerment (ACE) Project, USAID/Liberia, http://www.acdivoca.org/acdivoca/portalhub.nsf/id/liberiaace
P R OFE SS ION A L SK IL LS F OCU S: PLANNING FOR A C T I ON In the above topical guide you learned a range of steps which you should take in order to gather information and make decisions to continually improve program interventions for effective performance results and address market opportunities. If you work to capture information and knowledge throughout the project implementation process and consider all the components and dynamics in the value chain, the amount of information gathered could be overambitious or beyond your actual needs or even resources available. To address this challenge, in this Professional Skills Focus you will learn some techniques and tools you can use to prioritize the information that you have, which will enable you to translate your research into actions. As mentioned above, there are a number of tools and techniques available to you to help decide how your research and information should be translated into your value chain facilitation activities. One of the major challenges you may face is that you may not have the time to gather all the information you would like to (in an ideal world) before having to decide on a plan to put the research into action. We will focus on how to prioritize the information that you have so that you can determine how to proceed. The steps towards putting research into action covered in this focus are: 1. Validate your scope and parameters 2. Identify potential actions and reasoning 3. Prioritize your research findings into action 4. Build the actions into your plan 1. Validate your scope and parameters Look back at your scope and parameters you set for yourself during step one of the above topical guide and ensure you have documented them in terms of the limitations they represent for the research you have gathered. What assumptions have you made when completing this research? What are the risks of making these assumptions? Understanding these will be useful when proceeding in order for you to weigh the actions you plan to take against the risks they might represent. Note, if you are using this Focus to support a different area of action planning within your value chain project, you will need to refer to the scope and parameters of that area of work. Setting the scope and parameters for your work is key to understanding what the risks are versus the opportunities in any area of your project. Also consider the critical success factors for the project as you do this. You will have defined your critical success factors for the project. Have the list of these critical success factors to hand to support your understanding of the risks and opportunities? You will better be able to decide where to act when you compare the risks and opportunities to the factors vital to the success of the project. You will also be able to complete the next step by including the critical success factors as criteria for determining the feasibility, advantages and disadvantages of taking a particular action. 2. Identify potential actions and reasoning Now that you know what the data you are working with and what its (potential) limitations or risks are, you can start to determine how to put this research into action. A simple yet effective tool which has been used as part of a disaster recovery process in developing countries is a table to document Response Options, which is a tool from the EMMA toolkit (Mike Albu). For this Focus, the tool has been adapted into a more general Action Prioritization Work Sheet you can use in any stage of your value chain project.
Using this worksheet, draw on the research that you have gathered to map out a series of potential actions you could take. Complete the following sections to document the details you will need to use when deciding if you should include the potential action part of your plan. Figure 6: Action Prioritization Worksheet This worksheet is included in the materials for this topical guide and professional skill focus. A full example cited from an EMMA report is included with the template, to guide you on how to use this tool to document the potential actions you are considering as a result of your research. Mentee Reflection What challenges did you experience whilst filling in 3. Prioritize your research findings into actions the Action Prioritization Worksheet? Discuss with your mentor how you addressed these challenges. Once you have gathered your research into a list of potential actions, you may be ready to act. Prioritizing these actions should be based on a clear understanding of how addressing an action will impact the project s goals, the stakeholders, and the socio-cultural factors within the market. If you feel that you fully understand the potential impacts of taking a particular action or set of actions, the worksheet may have helped you to prioritize actions effectively. Note. If your actions list is complex, or you feel that further analysis is needed, you may find it useful to apply your list of actions to the following Action Planning Tool. This tool helps you to separate the potential actions based upon their criticality and relevance to your organization and your stakeholders.
Figure 7: Action Planning Tool The tool asks you to assign each of the potential actions (or research findings) to a quadrant, based on whether you need to monitor, ignore, manage or act now in each case. You can work with stakeholder groups to look at the research findings and assign them to a particular quadrant. For example findings from market observations, findings from secondary research, or a list of issues your team has documented. Prioritizing these issues is based on understanding how important an issue is to the company (its current or potential impact on the company) as well as to the company's stakeholders (who, as you will remember, are a critical success factor in sustainability efforts). Figure 8: Guidelines for Using the Action Planning Tool Quadrant Act Now Manage Monitor Description and Example The issues / situations which have the most impact (whether positive e.g. (market opportunities for a large rural community) or negative (major risks) These are of high stakeholder interest and therefore are clear priorities Issues /situations with high impact on the objectives of the value chain/ the team / the organization but with relatively low stakeholder interest (e.g. little impact on the rural communities) need to be dealt with through normal management channels Example: in most business sectors employee health does not make or break the company, even though health problems negatively impact success factors like productivity. Most businesses would manage the issue by improving their existing health care processes. However, a cholera outbreak caused by flooding would be a major risk to the livelihoods of rural communities and would require immediate action. This is the difference between manage (improving health care) and act now (address cholera outbreak) Issues / situations with high stakeholder interest but low direct impact on the business need to be monitored, so that action can be taken on the issue. Example: labor standards in a food production company off-shore (i.e. in a location remote from the headquarters and consumer market for a given product) may not appear relevant to the private sector leadership in that company. However, they may discover later that they potentially have a huge impact on reputation, which could harm revenues if consumers boycotted the products because of unacceptable labor standards.
Ignore Low impact, low interest issues or situations are low on the priority list, as these issues will not receive resources of any kind, even to monitor them. They can be ignored. Use the Action Planning tool (if you have determined that you need to) to choose your prioritized actions. You can now build these actions into your plan. You can draw the action planning tool out on a piece of paper and jot down the actions by placing them in the appropriate quadrants. Alternatively you could complete this process with your team, using post-it notes, one for each of the potential actions. Draw out the Action Planning Tool on a whiteboard or flipchart, and discuss with the team where each potential action should go. You can then easily move around the actions if the group decides they should fit in one quadrant rather than another. Keep in mind that setting priorities is not a one-time process. As with the other aspects of the value chain project, including market research, you will need to update these priorities periodically as internal and external factors change. 4. Build the actions into your plan When you have the actions prioritized, either from step two or both steps two and three, you are ready to develop these into goals, milestones and actions (at a more detailed level) as part of your plan. You have now used research to plan a set of prioritized actions that should have a significant impact on the project s success. Figure 9: Building Actions into the Project Plan Alternative Tool: Business Case Matrix Another tool you might wish to consider is developing a Business Case Matrix to compare business initiatives and initiatives in support of your organization s strategic goals. This would be represented using a table with a vertical and horizontal axis. On the vertical axis, you would represent the top success factors for a business to engage in partnership with a community on a value chain initiative (Business Success Factors). This will help you to keep in mind that value chain engagements need to have incentives which will encourage lead firms to enter into partnerships (as well as addressing the organization s value chain criteria). For example: 1. Revenue growth and market access 2. Cost savings and productivity 3. Access to capital 4. Risk management and license to operate
5. Human capital 6. Brand value and reputation On the horizontal axis you will document the top market engagement factors from your organization s perspective that will enable your organization s strategic goals and vision to be met by raising ten million women and girls out of poverty (Development Success Factors). For example: 1. Community development 2. Local economic growth 3. Improved access to products and services 4. Increased health and social well being 5. Improved gender equity You can then look at your research against this matrix and determine where the opportunities are which will meet goals and incentives for both factors. These provide the greatest opportunities for market engagement. You can show this in the matrix by shading darker those areas in the matrix. When you have determined these areas of opportunity, you will easily be able to develop the key messages for presentations to either a donor audience (or NGO) and for a private sector audience. For a private sector audience, for example, you would focus on the greatest opportunities from the perspective of the vertical axis, as these outline the incentives which will encourage private sector firms to participate.
Figure 10: The Business Case Matrix
RE FLE C T ION Reflect on the different types of tools and methods in this topical guide. Describe one area of your current value chain work where you have had to use one of these kinds information gathering methods. What difference did it make to the success of your value chain project? Comment on how effective the knowledge management system with in your work has been on female participation in the value chain. What challenges has this presented you with when you have worked to incorporate gender equity into your value chain facilitation approaches?