Professional Documents
Culture Documents
OVERVIEW
Action Plan
Implementation
Workshop
Stakeholder
Strategy
Competitiveness
Analysis
Value Chain
Selection
Value Chain
Global
Retailers
National
Retailers
Sector specific
providers
Cross-cutting
providers
Financial (cross
cutting)
Exporters
Wholesalers
Processors
Producers
Producers
Input Suppliers
Globalization
Trends
Liberalization of tariff and non-tariff barriers
Bilateral free trade agreements
Growth in branding
Specialty coffee
87%
94%
90%
60%
70%
40%
70%
40%
+90%
93%
Steve McCarthy
ACDI/VOCA
High Competitiveness
Potential
Competitiveness
Gender
NRM
HIV/AIDS
Cross-cutting
Issues
Impact
Employment
Income
MSME potential
Income distribution
MSME growth
Livelihood and Security
Competitiveness
BOSTON MATRIX
MARKET GROWTH
MARKET SHARE
LOW
H
I
G
H
L
O
W
HIGH
CASH
COWS
STARS
DOGS
QUESTION
MARKS?
Impact
Number of MSEs
Upgrading potential
Potential for livelihood
improvement
Potential for
employment
generation
Cross-cutting
NRM (Natural
Resource
Management)
Gender
Trafficked
women
HIV/AIDS
Steve McCarthy
ACDI/VOCA
A tool to analyze:
Actors
Factors
Relationships
Implementation
Workshop
Stakeholder
Strategy
Competitiveness
Analysis
Value Chain
Selection
Value Chain
Value
Actors
Chain
Analysis
Factors
Relationships
ACTORS
Global
Retailers
National
Retailers
Sector specific
providers
Cross-cutting
providers
Financial (cross
cutting)
Exporters
Wholesalers
Processors
Producers
Producers
Input Suppliers
1. End Market
2. Business Enabling
Environment
Global
National
3. Inter-Firm Cooperation
Vertical
Horizontal
4. Supporting Markets
Sector specific
Cross cutting
Financial
5. Firm Level Upgrading
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
END MARKETS
End Markets define universe of opportunities
Final Buyer
International wholesalers and
retailers)
National and Local Markets
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
WTO
Multi-lateral agreements
Free Trade Agreements
Standards
Organic, fair trade
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
Property rights
Duties
Tariffs
Business licensing
Monetary and Fiscal Policies
Public Infrastructure
Policy & Regulation
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
Infrastructure
Transport,
telecommunication
Regional policies
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
input supply
distribution to final consumer
Global
Retailers
National
Retailers
Exporters
Wholesalers
Processors
Producers
Input Suppliers
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
SUPPORTING MARKETS
Supporting Markets include BDS
Global
Retailers
National
Retailers
Cross-cutting providers
Financial (cross-cutting)
providers
Sector specific
providers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
FIRM-LEVEL UPGRADING
Firm-Level Upgrading requires supporting markets
Upgrading by:
Upgrading requires:
Improving products
Improving process
Specializing in new
functions
Moving into new market
channels
Appropriate incentives
(consider risks, expected
returns)
Environment
Global
National
3. Inter-Firm Cooperation
Vertical
Horizontal
4. Supporting Markets
Sector specific
Cross cutting
Financial
5. Firm Level Upgrading
Global
Retailers
National
Retailers
Exporters
Wholesalers
Cross-cutting
providers
Processors
Financial (cross
cutting)
Producers
Input Suppliers
Balanced
(Organic Coffee)
Buyers
Directed
(Export Crafts)
Major
Buyer
Price
Suppliers
01/18/15
Suppliers
Suppliers
Hierarchy
(Cut Flowers)
Integrated
Firm
Exporter
s
Wholesalers
Processors
Cross-cutting
providers
Producers
Financial
(crosscutting)
providers
Input Suppliers
Flow of Relationships:
$$
Products
Services
Information
MARKET RELATIONSHIPS
Learning
Benefits
Power
Access to Learning
Affect
Flow of Relationships:
$$
Products
Services
Information
Access to Benefits
Distribution of Power
RELATIONSHIPS
Learning
Benefits
Benefits
Power
Power
Learning
Foster learning
Where will learning come from over time?
Buyers as catalysts for change and learning
Input suppliers as sources of information
Traders as disseminators of innovation
Service providers contributions to learning
RELATIONSHIPS
Learning
Benefits
Benefits
Power
Power
Learning
RELATIONSHIPS
Learning
Benefits
Benefits
Power
Power
Learning
Win-Win
Steve McCarthy
ACDI/VOCA
Value
Actors
Chain
Analysis
Factors
Relationships
What do we map?
Basic map
Functions
Product life cycle from
conception to end use
Participant(s) at each
function
Linkages between the
participants-horizontal and
vertical
Detailed Map
Added value or gross
margins of each function
Number of firms performing
each function
Volumes moving between
levels
Four steps:
1. Identify the functions
2. Identify the participants
3. Complete the work sheet
4. Draw the initial map
Functions
Retail
Wholesaling
Processing
Assembly
Production
Input Supply
Participants
Village Stockists
Input Supply Companies
Small Scale Producers
Producer Associations
Medium-scale and Commercial Producers
Oil Processors
Wholesalers
Retailers
Functions
Participants
Wholesalers
Oil Processors
Traders
Input Supply
Medium-Scale
and Commercial
Producers
Production
Producer
Associations
Assembly
Small Scale
Producers
Processing
Input Supply
Companies
Village Stockists
Wholesaling
Functions
Retail
Wholesaling
Wholesalers
Processing
Oil
Policy Makers
Processors
Cake
Commercial banks/
Non Ban Financ.
Institutions
Traders
Assembly
Production
Medium-Scale and
Commercial Producers
Small Scale
Producers
Tobacco
Company
Producer
Associations
Input Supply
Village Stockists
Input Supply
Companies
Seed
Fertilizer
Pesticide
Leasing
Companies
1.
2.
3.
4.
5.
Analysis of overlays
Steve McCarthy
ACDI/VOCA
Action Plan
Implementation
Workshop
Stakeholder
Strategy
Competitiveness
Analysis
Value Chain
Selection
Value Chain
Market positioning
Where can I compete which strategy
Innovative
Design
4
3
Price
India
Italy
1
0
Flexible
Large Orders
Flexible
Small Orders
Response
Time
Punctuality
MARKET POSITIONING
Strategies for creating competitive advantage:
Efficiency
competition based on price
Differentiation
competition based on differentiation
Market Focus
niche markets, fair trade, organic
Differentiation
Excellent
Afghanistan
India
China
Poor
Poor
Cost
Excellent
Quality
EUREGAP
Quantity
Variety
Definition:
Steve McCarthy
ACDI/VOCA
WHAT to DO?
Action Plan
Implementation
Workshop
Stakeholder
Strategy
Competitiveness
Analysis
Value Chain
Selection
Value Chain
Stakeholder Workshops
Definition and Objective
Present a brief
overview of the
industry and its
actors
Present the value
chain map and
ask participants if
they agree with it
Functions
Service Providers
Retailing
Chemengo Retailers
Supermarkets
Wholesalers
Wholesaling
Oil
Processing
Processors*
Cake
Traders
Assembly
Machinery and
Equipment Suppliers
Medium-Scale
and Commercial
Producers
Producer
Production
Small Scale
Producers
Input Supply
Village Stockists
Associations
Financial Services
Engineering Services
Input Supply
Companies
Seed
Fertilizer
Pesticide
Extension
NGOs
LEGEND
Transactions
Processors
= Participant in
the Value Chain
Livestock/Poultry Feed
= Final Market
Production
= Market functions
= Market-Based
= Balanced network
= Captive network
Producer
Associations
= Participant in the
Value Chain, broken
line indicates
skipped functions
Start the discussion around how the industry would look like if it were
more competitive
VISION
EXPECTED OUTCOMES
Steve McCarthy
ACDI/VOCA
Action Plan
Implementation
Workshop
Stakeholder
Strategy
Competitiveness
Analysis
Value Chain
Selection
Value Chain
THE CHALLENGE
WHO intervenes
and HOW?
Activities
WHAT?
Approaches
WHO? + HOW?
WHO?
DEFINING ROLES
Private Sector
Internal actors. Conduct business in a competitive environment
based on economic incentives.
Government
Internal actors. Foster a conducive enabling environment and
provide public goods in the public interest.
Implementing Organizations
External actors. Create incentives for industry actors to create and
sustain competitiveness.
Donors
External actors. Plan, design, and fund activities to build
competitiveness and learn from past experiences.
WHO?
DEFINING ROLES
Industry-Led
Internal actors have a lead role in developing
the strategy and course of action.
What are the implications for external actors?
Project-Led
External actors dictate the strategy and
course of action.
What are the implications for internal actors?
WHO?
INTERNAL CATALYSTS
HOW?
FOCUS ON INCENTIVES
Does my intervention create incentives for value chain
actors to change behavior positively affecting
Investing
Learning and Innovating
Cooperating
without ongoing subsidies?
WHO?
METHODS OF INTERVENTION
DIRECT PROVISION
FACILITATION
WHO?
METHODS OF INTERVENTION
Direct Provision
Pros
Results in short-term
Easier to control outputs and
outcomes
Easier to manage
Facilitation
Pros
Sustainable
Leverages incentives
Reduces market distortions
Leads to viable exit strategies
Cons
Not sustainable
Easy to confuse project &
operating budgets (crosssubsidies)
Cons
Slower results in ST
Difficult when no providers
available
Cost implications
PRINCIPLES OF INTERVENTION
Redundancy
Dont do it, if its going to happen anyway
Sequencing
Are there things that need to happen first?
Sustainability
Resource Allocation
Does it make optimal use of project resources?
What are the trade-offs?
KEY MESSAGES
Poverty reduction can only be sustained through economic
growth.
Globalization shifts the competitiveness lens from firm to
industry.
Value chain framework enables us to look at the market
systems, including actors, factors and relationships, in a
systematic approach in order to achieve systemic change.
Power dynamics, learning flows and distribution of benefits.
are key to understanding incentives for improved
competitiveness.
Competitiveness requires a participatory approach and
stakeholder ownership of the process.
Thank You!
Steve McCarthy
ACDI/VOCA