Using the market to cultivate a global mindset among farmers and entrepreneurs

One of the most seductive assumptions in African agriculture is that farmers and aspiring agricultural entrepreneurs can succeed through following a specific set of steps. However, as markets become highly networked and competitive, success no longer just depends on what a farmer or an entrepreneur does but on the actions of rivals or competitors. Unless they cultivate a global mindset, farmers and entrepreneurs in developing countries will continue to over-simplify agriculture by thinking it is a straight forward undertaking with obvious results.

emkmabo

Dynamics of a free-market economy

Key elements that drive performance in agribusiness are now beyond the control of farmers, traders and other value chain actors. That is why farmers may never achieve success simply by following certain steps prescribed by input companies or extension officers. In the prevalent free-market economy, competition and imitation is leading to a decline in profits. For instance, the more farmers get into producing a commodity, the less income is shared among farmers. Unfortunately, in Zimbabwe, for instance, tobacco farmers want more money each year irrespective of the effects of more farmers joining the tobacco production band-wagon every season. As more farmers start producing a particular commodity, they copy each other’s winning ways and diffuse best practices.

In many developing countries, domestic horticulture has shown that farmers and value chain actors who enjoy long-term success do so through a number of innovations such as stringing together many short-term successes unlike trying to look for elusive secrets to success.  This is contrary to a tendency by development interventions and formal contractual arrangements to mislead smallholder farmers into believing that following a few key steps will inevitably lead to success without influence from external factors. As a result of these misconceptions, many farmers call eMKambo looking for a formula that can be easily applied in order to earn high income from agricultural activities.  Some of the famous questions include: Which crop can I grow to earn more income?  Our usual answer is that there are no guaranteed keys to success in agriculture because a lot depends of competitors, mostly unknown to farmers until they get into the market.

Limitations of searching for certainty

Rather than search in vain for success formulas, eMKambo always encourages farmers and other value chain actors to adjust their thinking and recognize the fundamental uncertainty of the agribusiness world. A majority of farmers have been schooled into believing that agriculture and related businesses can be made predictable so that specific actions lead to certain outcomes. The reality is that agriculture is now largely about making choices and decisions under uncertainty. For instance, it is difficult to accurately know whether consumers will embrace or reject your commodity. Actions of competing farmers and food producers are often fluid and unknown.

Empowering farmers through evidence and a global mindset

African agriculture is becoming more about odds, chances, and trade-offs than abundance of natural resources. Faced with uncertainties of the agricultural sector, especially markets, wise farmers and value chain actors have to invest in gathering accurate information and subjecting it to careful scrutiny in order to improve their odds of success.  While greater knowledge and understanding is critical, good decisions do not always lead to favorable outcomes, and unfavorable outcomes are not always the result of poor decisions. Agribusiness is no longer a place of clear causal relationships, where a given set of actions leads to predictable results, but one that is more tenuous and uncertain. That is why farmers and agricultural entrepreneurs should gather appropriate information, evaluate it thoughtfully, and make choices that provide the best chance for success, while recognizing the fundamental nature of uncertainties surrounding agricultural economies.

Rather than expecting every smallholder farmer to travel around the globe understanding international markets, it should be the role of educated people in developing countries to cultivate a global mindset in their local communities. How do educated Africans and those toying with technology help farmers so that they don’t continue wasting their capabilities by producing more than the local market can absorb?  How can technology enable marginalized people to reach various parts of the globe without physically going there? The informal market constantly challenges leadership and intellectual skills through presenting models cultivating and utilizing global mindset. Farmers who frequent informal markets always express the following attributes and competencies that exemplify a global mindset:

  • A strong desire and resilience for working cross-culturally.
  • Thorough understanding and knowledge of other cultures.
  • Careful choice of the correct verbal and non-verbal actions in unfamiliar circumstances.

The genesis of a global mindset is when communities celebrate diversity and reward culturally intelligent behavior. While local people embrace both external and local commodities, to become smart consumers, they need capacity building.  When a global mindset geminates, a farmer can be able to connect his resources such as land, curiosity, water and labor with the globe. Empowering farming and rural communities with a global mindset is like giving them a key out of poverty because they will become confident knowledge seekers. Farmers should be wise enough to constantly look for independent evidence rather than merely accepting ideas from their associations or peers as the only gospel truth. Decisions must not be entirely based on data contaminated by their biases.

 

charles@knowledgetransafrica.com  / charles@emkambo.co.zw / info@knowledgetransafrica.com

Website: www.emkambo.co.zw / www.knowledgetransafrica.com

eMkambo Call Centre: 0771 859000-5/ 0716 331140-5 / 0739 866 343-6

Succeeding through a secret mix of competencies and data

The fact that farmers and students exposed to the same capacity building initiatives produce different results suggests training alone does not lead to success. In the majority of developing countries, farmers in the same environment and with access to similar resources achieve different outcomes. On the other hand, agricultural economists and agronomists who did the same course can achieve different results. If it is difficult for sophisticated graduates to translate knowledge they have acquired during four years of university education, why should we expect farmers and semi-literate people to find it easy?

emkambo1

Limitations of trying to professionalize local indigenous knowledge

Instead of addressing structural and institutional barriers, African policy makers, private companies like seed houses and development agencies are blaming farmers for not adopting new technologies to lift themselves out of poverty. There is no realization that knowledge application is context-sensitive such that for many innovative farmers, it is a secret mix of competencies. That is why most of the farmers who are asked to describe what makes them succeed may not know what really contributes to their success but go on to share surface intuitions. If it is about hard work, every farmer works hard. While farmers and rural entrepreneurs are expected to share knowledge, each actor tends to have a secret set of skills and competencies hidden from the surface. Very few farmers and traders have the ability to apply what they know under pressure in order improve their level of quality. In the absence of clear market channels and processes, farmers can do everything right but face different prohibitive rules on the market.

Failure to account for contextual dynamics is one of the reasons why efforts by development actors to turn local indigenous knowledge into professional communication products like videos, manuals and formal reports is reaching a dead end. To the extent this effort does not take into account the value of the oral and fluid nature of local indigenous knowledge, it remains communication lipstick. For instance, aggregating commodities among smallholder farmers for the market is often very difficult due to different circumstances and needs among farmers. Some want to sell immediately while others may have other options like remittances from their children based in urban centres.

Benefits of a nuanced understanding of consumers

For food producers in developing countries, an important part of secret competencies is understanding consumers at a granular level.  This is where data and analytics become vital. Value chain actors who are beginning to embrace a culture of data collection and analysis are building a nuanced understanding of their customers. For instance, three classes of consumers are emerging in many African countries – those who want to go back to traditional food systems; those trying to balance traditional with modern food choices and; the last group comprising those not sure what they really want (lukewarm by-standers who consume whatever comes).  Efforts to promote organic food should consider these issues.

Knowing the market includes detailed characterization of consumers. Targeted marketing messages can only be developed from drilling down into detailed nuances of different classes of consumers based on their incomes levels and culture, among other indicators. Without digging deeper into the attitudes and behaviors of consumers, it is difficult for traders to plan and build sustainable businesses. Competencies in manipulating data can reveal more meaningful layers of insights into what influences choices by low income consumers who patronize African informal markets.  Although many consumers are becoming health-conscious, sporadic incomes and poverty often force them to consume whatever comes.

emkambo2

On a more revolutionary note, a new breed of dynamic value chain actors is harnessing ICTs to build data- informed businesses that undermine traditional agribusiness models like contract farming. This trend is transforming the nature of competition in African agriculture such that supermarkets and processors no longer have monopoly on consumers and market segments. Collecting data regularly in fluid informal markets is enabling smart value chain actors to capture patterns at a very detailed level in ways that cultivate a culture of fluid knowledge development. That is why policy makers, financial institutions and development agencies should invest in monitoring of agricultural markets for new insights and best practices.  Best practices in agricultural production are meaningless without insights from the market.

 

charles@knowledgetransafrica.com  / charles@emkambo.co.zw / info@knowledgetransafrica.com

Website: www.emkambo.co.zw / www.knowledgetransafrica.com

eMkambo Call Centre: 0771 859000-5/ 0716 331140-5 / 0739 866 343-6