Conceptual Contributions for the Development of the DED Cooperating Profile in Marketing.
1. Background
Today a large percentage of the urban and rural populations of Latin America find themselves at a crossroads.
On the one hand, their traditional products and services lose value in an increasingly globalized market and, on the other, their natural resource base is reduced for the future. As a result, many families have abandoned the countryside in search of better options in cities, capitals and even abroad (typical case of the Dominican Republic), without being able to achieve decent livelihoods for their members.
Faced with this reality, there are donor organizations that support rural development projects, comprehensive natural resource management and strengthening grassroots organizations, focused on increasing family income.
However, projects contemplate a single part of the production chain and, therefore, have limited effectiveness. A classic example of this approach is the project that manages, with much effort and resources, to significantly increase the productivity of small producers, but which crashes against the lack of a market for this additional product, thus leaving producers disappointed and often with lower income than in the past. This situation is due to the systematic ignorance of concepts such as market identification, chain vision and value addition that are key to better focus rural development projects and not due to lack of resources or interest in supporting rural populations.
It would be illogical not to integrate a package as important as the "chain approach" in the development of PROCARYN, considering that currently the Dominican Republic started the FTA negotiations with the United States on January 12 and they are about to start the " Second Round of Negotiations in the week of February 9 to 13. Subject that in the Mesoamerican region has been considered fundamental by peasant-based organizations and NGOs for the implementation of future local development projects.
The previous premise was reflected in the "First Central American Congress of Communities and Grassroots Organizations in the face of the development of the Central America-US FTA, Order of Natural Resources, Competitiveness, Creation of Cluster and Globalization" held between 10 to 18 December in the city of Rivas, Nicaragua.
This Congress allowed to gather the main community, indigenous and political leaders of the Central American countries, Mexico and some countries of South America. Points 4 and 12 of the congress declaration are of importance to be considered by international cooperation when planning and implementing rural development projects: “(4) The programs and projects promoted by central governments and supported by the agencies of International cooperation and friendly countries, generally do not fall under comprehensive processes that allow project beneficiaries the full potential of raw material transformation and marketing.
The coordination of activities between programs and projects with national and territorial development policies and strategies are in most cases isolated and outside a context of economic and social development, integrating the role of women and minors in the agricultural, livestock, fishing and forestry production processes. ”
"(12) The programs and projects developed by the central governments and jointly with the international cooperation agencies should strengthen the beneficiaries with negotiation capacities, promoting the Productive Value Chain (CPV) approach." (Declaration of Congress, December 2003).
2. Chain Approach
Traditionally, interventions that seek to support the development of the productive sector (agricultural, livestock, forestry, fishing, small industry, etc.) have focused on increasing production systems through agrarian reform programs, credit, research, technical assistance, among others. This type of intervention, in general, has resulted in an increase in the production and productivity of the sector measured in kilograms, pounds or quintals produced per cultivated area, thus allowing substantial improvements in the supply of agricultural basic products.
However, these increases in production have generated significant reductions in the prices paid for these products, as a result of the law of supply and demand. A clear example of this trend can be seen in the average prices of basic commodity products, which have been declining for the past 50 years.
Although increases in production have “lowered” the cost of food for important segments of the urban population, they have not generated sustainable improvements in the incomes of producers or rural populations, nor have they contributed to reducing levels of rural poverty.
To achieve an effective reduction in rural poverty levels requires thinking beyond productivity and incorporating issues such as profitability and competitiveness in our work agenda.
Profitability, measured in income by cultivated area, leads us to cover topics such as the generation of added value, the diversification of production systems with a micro-business approach and the development of more dynamic and complex markets.
The promotion of an organized rural sector and of managing and maintaining connections with growing markets is then presented as an alternative rural development strategy.
Furthermore, the global trend towards globalization and free trade requires a change from the "productivity" approach to a "competitiveness" approach. For the achievement of this competitiveness, the business organization both at the company level and its links forward and backward, and access to information and technology are increasingly necessary.
We must move from a strategy that only takes advantage of comparative advantages, availability of cheap labor, state subsidies and little-processed products, easily replicable by other areas or countries, towards a strategy of competitive advantages. This strategy is based on
- a sustainable management of natural resources, the identification of consumer and market demand to face the challenge of globalization, the elaboration of more complex products by economic sector (“cluster”), the addition of value to the business organization, the generation of strategic alliances between the actors that carry out the different stages of the production chain.
The strategy of competitive advantages must also be interrelated with territorial planning and environmental education to achieve an integrated management of natural resources and a "true" economic, social and ecological sustainability.
Therefore, agri-food systems are in a stage of rapid change. Increasing vertical integration is observed with the objective of guaranteeing quality, continuous supply and more competitive prices.
The rural problem shares certain basic characteristics that are summarized below:
(1) Production or marketing approach but not marketing. In rural areas, most producers have a focus on the production and marketing of their products, which means that they know how to produce and sell their products but not market them.
The marketing concept aims to seek more competitive advantages through strategies such as product differentiation, market segmentation and the development of specific customer niches.
(2) Disarticulation of the productive chain. The different links in the production chain (production, post-harvest handling - transformation, marketing and business development services) are disjointed, which generates a deficient flow of information that is used by market agents and generates systematic inefficiencies throughout chain.
(3) Weak and incipient business organization. Existing rural organizations are, for the most part, weak in business terms. You have limited capacity to identify and analyze critical points in your production chains and, therefore, find key strategies or actions to improve your business.
(4) Tendency towards individualism and not towards the search for comprehensive management of sectoral competitiveness.
Given the uncertainty that characterizes the rural sector, it is normal to find that the actors seek individual short-term solutions instead of thinking about initiatives that promote the sector's competitiveness in the medium or long term. This translates into relationships of little trust with other actors in the production chain and a limited capacity to take on strategic initiatives.
(5) Little or no coordination and partial focus of support services. Support services to the mainly agricultural productive sector have been characterized by being punctual and focused on a single link in the chain.
Furthermore, these activities reach producers in an uncoordinated way, resulting in a duplication of efforts in one area and gaps in others as a result, the support received by the agricultural sector is not effective enough to improve their productivity.
3. Productive Value Chain in the PROCARYN framework
About 3 years after the execution of Phase I of the PROCARYN, there is a need to reorient the project to achieve the objectives and proposed results.
For this reason, it has been proposed to work within the new “Approach to Integrated Management of Basin and Territory” of PROCARYN, the Productive Value Chains (CPV) as one of the main lines of action.
To date, PROCARYN has not deeply considered the issue of CPV, although there are initiatives that can be easily framed within the context of "Chains" such as:
- Wood certification through the WWF modular system Quality coffee certification.
The operationalization of the "Comprehensive Management Approach" will be carried out through the creation of a new component, which will focus on the following lines of action:
1) Comprehensive multi-level planning (basin, municipality, micro-basin, farm community);
2) Execution of multi-level comprehensive management models (micro-basin, community, farm);
3) Intersectoral and external coordination for the execution of activities;
4) Comprehensive monitoring;
5) Development of Productive Value Chains;
6) Development of the Training Plan;
7) Interrelated topics (Territorial Planning, Environmental Education, Gender, etc.)
The integration of the “Vision of Productive Value Chains” to the new component will allow the comprehensive implementation of efforts for the preliminary development of the first experiences of Chains in PROCARYN and the region.
The Vision of CPV is a first attempt to respond to the particular problem of the project to develop the "Comprehensive Management Approach" !, in order to see the entire agro-industrial chain from the provision of inputs and the productive unit (management farm) until the marketing of the final product, going through the post-harvest handling and processing stage. The links and their functions can be analyzed in the following diagram.
The use of the CPV approach within the Integral Management Component has several advantages:
1) It allows a broad vision of the chain and its different actors, therefore, a more complete management of information (lines of action for coordination and comprehensive monitoring);
2) Access to more complete information facilitates the identification of critical points that impede the development of the chain and, in addition, the location of more effective solution alternatives with greater impact, thus achieving a more competitive chain;
3) The chain is an appropriate setting for the search for alliances and synergies between the different productive actors since it brings together actors with common interests, which reduces interaction costs, allows a more efficient use of available resources.
4. Recommendations for the professional profile of the DED "Cooperating in Marketing"
The German Social-Technical Cooperation Service (DED) must consider the reorientation that is being promoted to the project through the implementation of the "Approach to Integrated Management of Basin and Territory" and the creation of a new component "Comprehensive Management", component that will house the actions that promote and implement the “Productive Value Chains” (CPV), for which reason it is planned that the cooperator can be integrated in a short time (May 2004) to support the process of immersion, training and mapping of actors in the chains that the project prioritizes to implement.
Two profiles of the cooperator are recommended, which are presented below:
Profile A (minimum)
Vocational training
- Agricultural Engineer, with a postgraduate degree in sectoral economics and / or marketing; Bachelor's degree in Agricultural Economics or Economics with a postgraduate degree in sectoral economics and / or marketing. Bachelor's degree in Marketing and Advertising with a postgraduate degree in economics, agroproduction and / or commercialization
Experience
- 3 years of experience in activities related to community organization; Development of market studies and marketing of agricultural, livestock and forestry products; Knowledge in the modalities of territorial planning, regional and community development plans; Basic knowledge of the agricultural, livestock and forestry; Knowledge in forming associations and / or commercial companies (business organization and support services); Basic command of space economy; Command of cluster concepts (agglomerates or conglomerates), value production chains and competitiveness; Knowledge of regional economic development processes (globalization, free trade agreements, organic certification, etc.).
Profile B (ideal)
Vocational training
- Agricultural Engineer, with a master's degree in market and / space or agricultural economics. Bachelor's degree in Agricultural Economics or Economics with a master's degree in market and / space or agricultural economics.
Experience
- 5 years of experience in activities related to community organization; International and national economic legislation; Development of market studies and marketing of agricultural, livestock and forestry products; Knowledge and development in the modalities of territorial planning, regional and community development plans; Knowledge and development of the agricultural, livestock and forestry production process; Knowledge in the formation of associations and / or commercial companies (business organization and support services); Basic command of space economy; Command of cluster concepts (agglomerates or conglomerates), production chains of value and competitiveness, knowledge of regional processes of economic development (globalization, free trade agreements, organic certification, etc.);Formulation of Mapping of Actors of CPV links; Formulation of basic principles of competitiveness strategies; Knowledge in intelligence and contacts of CPV markets; Negotiation plans and monitoring of competitiveness strategies.
