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SECTION 5: COMPETITIVENESS VISION Value chain competitiveness is the ability of actors within an industry to:1

Anticipate and meet buyers’ demands

Identify and take advantage of end-market opportunities

Respond to changes in market demand or the competitive landscape Greening and inclusive growth must be rooted in the supply chain competitiveness vision and strategy. To do this, it is important to see environmental issues as providing an opportunity to reduce costs in the supply chain and to open up new markets by developing environment-friendly products and services. The process of greening and improving industry competitiveness must be driven by industry stakeholders. The challenges to developing a coherent greening and upgrading strategy—

1 USAID Briefing Paper: Using the Value Chain Approach in Designing a Competitiveness Strategy

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one that stakeholders are willing to buy into—can be met by forging a shared vision of a green, competitive,, and inclusive industry and developing a plan that benefits everyone, including smallholders.

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A competitiveness vision guides the development of a roadmap on how to move the chain or industry to sustained higher rates of growth. Without a common vision, it is difficult for actors to overcome the tendency to see each other solely as competitors, which hinders their ability to collaborate or take leadership to leverage resources, overcome common barriers and meet marketplace demand. Creation of the vision helps value chain actors transcend existing mind sets and break away from fatalistic attitudes prevalent among stakeholders. It is important to encourage players to come with a vision that reflects both self and industry or supply chain aspirations as this

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provides the motivation for collaboration. Value chain actors will invest in greening and upgrading initiatives only if the expected benefits will fulfil their individual interests and outweigh the costs. Actors should clearly see what the end goals of initiatives will be and how these will contribute to meeting their individual objectives. Understanding people’s incentive for participation also facilitates conflict management. From the vision, three to six month period action plans can be prepared. The rolling plans should be designed in such a way that these will contribute to the incremental achievement of medium term objectives parallel to providing players with tangible benefits at the shorter term.

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The heavy emphasis on common vision and its close link to real market opportunities are also central to the success of upgrading and greening initiatives. The best trigger for closer collaboration is the pursuit of lucrative markets as well as pride and social recognition. It is

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important to possess a holistic view of the market system so as to understand the interdependencies among its parts including the implications of changing one part on all other parts, and the relationships between the system and the communities/poor. In the formulation of the competitiveness vision, it is recommended to start with a very good understanding of the end markets and its requirements and the market system with a view of analysing its implications on resource poor households and the greening potentials vis-à-vis improving value chain competitiveness. It is recommended to work with core set of value chain actors including the smallholders in arriving at a consensus on the following: a) In what specific markets do you want your chain to be a major player? b) Who are/will be your target clientele and their needs/wants? Why will they buy your

products? c) Describe the attractiveness/relevance of the segments d) How will your supply chain access/reach the market? e) What kind of products do you want to offer to these markets? f) What changes in your operations and processes do you need to be competitive and

sustainable parallel to promoting the gainful participation of resource poor households in the chain as suppliers and/or consumers?

The writing of the vision during a stakeholder’s workshop is the easier process. The harder part is nudging players and stakeholders to take or pursue this seriously and not just another workshop output. One challenge is to help players to break out of their current mindsets. Without this, they will never seriously consider a new vision. A second challenge is to help players take ownership in a shared vision, and to reflect that their own individual interest or wishes are very much part of it. A third challenge is to help them develop a passion for their new vision.

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To facilitate shifts in mindsets, one essential means is to help them see the need for a systematically different approach to doing things. Another is to foster exposure to new approaches. To build a shared vision, facilitators can help actors to reach consensus on values and beliefs on how things should be covering the three dimensions --- economic, environment, and social. This requires an environment in which value chain actors feel safe in sharing their beliefs —an environment where everyone suspends their judgments of others while sharing. It also requires the development of group-process skills for dialogue, self-disclosure, listening, and conflict resolution, which takes guidance, time, and patience. To develop a passion for the new vision, the most important consideration is to foster a sense of ownership.

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Greening and upgrading require collaboration of all actors in the chain. To keep the vision

alive and exciting, it is recommended to disseminate it to a wider audience in formats that

can be appreciated by all those involved in the industry including consumers.

To obtain commitments, start with small short-term commitments and gradually scale up to bigger and more difficult decisions/tasks. To the extent possible, pledges and commitments towards greening, inclusive growth, and upgrading should be done publicly. When a person makes a commitment to others, most likely they will want to keep that commitment to ensure that they are viewed as “consistent”.

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References

USAID Briefing Paper: USING THE VALUE CHAIN APPROACH TO DESIGN A COMPETITIVENESS

STRATEGY

Boquiren and Idrovo; USAID Best Practices in Implementation MicroReport: Facilitating

Behavior Change Change and Transforming Relationships

Boquiren: Presentation on Facilitation – Meeting the Challenges of Value Chain

Development, Value Chain Learning Event, Washington DC.