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Scaling agricultural innovation

Scaling agricultural innovation

Many donor-funded agricultural projects are short-term in focus, with a limited number of beneficiaries, but to achieve and sustain outcomes at scale, they need to catalyse a lasting change in market conditions, or government services. Larry Cooley and Julie Howard, authors of a groundbreaking Sourcebook , published by Purdue University Press, report on how to scale up agricultural interventions for lasting, systemic change.

A decade ago, the audience for a discussion on ‘scaling’ international development initiatives could fit comfortably in a telephone booth. But times have changed. Today, virtually every serious conversation about development includes attention to strategies for achieving and sustaining results at scale; and there is an emerging body of literature, tools, case examples, and communities of practice from which to learn.

This change reflects growing concern over the seemingly endless array of projects that fail to reach large numbers of the poor or to sustain outcomes over time, and the mismatch between the magnitude of many of the world’s most serious problems and the relatively small donor resources arrayed against those problems.

In agriculture, there are only two platforms able to reliably deliver goods, services, and technologies at population scale – governments and businesses, or a hybrid of both. Unlike projects and donors, these two platforms are predicated on operating at scale – delivering services at “population level” in the case of governments, and reaching the “addressable market” in the case of businesses – and are intended to sustain delivery of goods and services over time. Thus, scale and sustainability are part of their DNA.

Projects are, by contrast, designed to achieve discrete objectives over a fixed period of time, usually for a limited number of direct beneficiaries. Simply put, if an agricultural project or innovation has no strategy for catalysing a lasting change in market conditions and/ or government services, it has no plan for achieving and sustaining outcomes at scale.

In a project-based world, the reward for a successful project is often another project – perhaps larger, but still donor-funded, still short-term, and still divorced from larger, permanent systemic changes.

Compounding these downsides of a development-by-project world, it’s important to note that, in the last decade, the number of official donors and donor projects has doubled, while the average size and duration of projects declined by 50%. This means an increasing number of smaller and shorter projects chasing big problems.

There is a growing recognition that addressing these realities calls for fundamental changes in established policies, procedures, and priorities of donor agencies, national governments, researchers, and programme implementers. More specifically, these changes imply a re-examination of the current preoccupation with technological innovation and ‘pilot projects’, and a fundamental rethinking of ways to ensure that donor investments are more likely to catalyse lasting, systemic change.

This reorientation implies: designing interventions with scale in mind and with clear scaling strategies; assessing and addressing obstacles to scalability; and actively managing the pathway to scale. 

The agriculture sector has been slower than some other sectors, most notably health, to incorporate these changes. In part, this reflects the fact that the sector’s important focus on innovation had the inadvertent effect of diverting attention from the less glamorous work of systems change that is needed to take innovation to scale. But, in our view, momentum for serious work on scaling in agriculture is building rapidly.

What might the alternative look like?

For starters, planning would work backwards from tangible goals, a concrete vision and business case for sustainable delivery at scale – how much, provided by whom to whom, paid for by whom – and would include an explicit focus on the changes needed to existing processes, pricing, policies, and procedures.

It would recognise that agriculture is a business, not a social sector, and would include an unromantic view of the relevant institutions, incentives and capacities, and the ways in which they interact. It would recognise that only governments and markets can deliver benefits sustainably at scale. And it would acknowledge that projects can change large systems only if used strategically to make permanent changes to commercial or governmental policies, incentives or capacity.

Getting out of a project mentality also requires an early emphasis on simplifying interventions and minimising marginal costs, keeping in mind that the ultimate goal is not creating the most effective model, but identifying and inducing lasting changes in ongoing systems.

For that, the simpler, cheaper, and more familiar, the better. In the same way, a focus on permanent change at scale requires transferring responsibilities to government and commercial actors much earlier than typically happens when implementing donor-funded projects.

Few interventions or innovations transition successfully to scale without someone performing a variety of ‘intermediation’ functions, including investment packaging and policy advocacy. In the commercialisation of high-margin innovations, these functions are often performed by highly compensated investment bankers, venture capitalists, and strategic consultants.

By contrast, in the low-margin, high-risk world of pro-poor agriculture, these semi-invisible functions, which fall between the more easily recognised functions of innovation and service delivery, have few reliable funding sources or advocates. Lacking the glamour of innovation, the immediacy of direct service delivery, or the prospect of charging for and recovering significant transactional returns, funding for these intermediation functions – with a few notable exceptions – becomes a missing link in the value chain or a missing gear in the scaling ‘machine’.

In an effort to flesh out these insights, assemble the relevant fieldbased experience, and highlight operational implications, in September 2018 Purdue University, in partnership with the African Development Bank, organised a landmark conference on scaling innovation in agriculture, Innovations in Agriculture: Scaling Up to Reach Millions. Informed and inspired by that conference, we were charged by the African Development Bank and Purdue to produce a Sourcebook as an easy-to-use reference on scaling, targeting a broad and diverse audience drawn from host governments, research institutions, and academic, business, policy, and donor communities concerned with leveraging agricultural innovation to meet the needs of the world’s poor.

The Sourcebook’s chapters address the following issues: designing with scale in mind; assessing scalability; using commercial markets to drive scaling; financing the transition to scale; creating an enabling environment for scale; tailoring metrics, monitoring, and evaluation to support sustainable outcomes at scale; and the critical role of intermediary and donor organisations. It acts a stand-alone source of guidance, tips, and examples, and provides links to additional resources for readers wishing for more detail.

The Sourcebook offers a variety of tools and models that can be used for planning a pathway to scale and for assessing scalability, including one widely used framework that consists of three steps and a total of 10 tasks essential for planning and achieving scale (see graphic overleaf).

The frameworks and tools are intended to support scaling by detailing the actions required for successful scaling, and by distinguishing a range of scaling strategies and their operational implications. Also included are many of the growing array of on-the-ground cases, donor practices, and analytic tools that can help to inform future efforts to scale agricultural interventions and outcomes.

Some of the Sourcebook’s principal findings include:

On the topic of market inclusion, a review of cases of successful and unsuccessful scaling suggests four factors as essential for expanding market inclusion:

• A surgical focus on gaps in the value chain;

• Effective use of local companies to address what some have called “the problem of the missing middle”;

• Improving access to, and efficiency of, capital-intensive inputs and services through local service providers, franchise systems and membership groups, and by harnessing information technology; and

• Encouraging a more active role by the private sector in the provision of extension services. On this topic of access to finance, the cases reviewed in the Sourcebook suggest that successful approaches almost always include specific measures to mitigate real or perceived risk, including efforts such as warehouse receipt systems, index-based insurance, and credit guarantees. We also found and documented a growing number of examples of blended finance, structured finance agreements, agricultural investment funds, and social impact investment.

More generally, the Sourcebook highlights seven insights about scaling through commercial pathways:

• First, there is no such thing as a fully ‘commercial’ pathway to scale; government policies, regulations and subsidies play central roles in scaling all agricultural interventions.

• Second, successful commercial scaling requires forming partnerships that go well beyond the traditional concept of ‘implementing partners’ to include key value chain actors such as equipment leasing, input provision and product aggregation enterprises.

• Third, the most vexing bottlenecks for scaling of innovations are usually non-technological in nature (e.g., access to market, enabling policies, seed systems, access to finance).

• Fourth, poor farmers’ time horizons tend to be extremely short; they cannot afford a mistake and tend to place a higher priority on minimising risk than on maximising reward.

• Fifth, monopoly and/or monopsony are sometimes useful in the short run to build effective and efficient supply chains, but often present challenges later.

• Sixth, initiatives must go beyond being ‘policy takers’ and play a much more active role in facilitating policy change that can be a scaling force multiplier.

• And seventh, there is rarely a straight line or a short journey from innovation to scale. Adaptive management is an essential ingredient in all successful scaling efforts.

Much remains to be done in systematising approaches to scaling, and particularly in incorporating attention to the non-technological forces that support or challenge scaling efforts. Just as was done with topics like monitoring and evaluation and gender, this work includes assembling useful tools, approaches, and relevant experience, and mobilising cadres of professionals – researchers, businesspeople, donors, and host government officials – who are comfortable using and building on those advances.

An initial step was taken by housing the extensive materials assembled for the Purdue conference and the Sourcebook under the auspices of a Working Group on Agriculture and Rural Development of the Community of Practice on Scaling Development Outcomes.

 

 

Should readers wish to access or contribute to that archive of materials, or be interested in joining the Community of Practice, they are invited to reach out to Larry Cooley (lcooley@ msi-inc.com)

Larry Cooley is President Emeritus of Management Systems International, a Tetra Tech company, and curator (with Johannes Linn) of the Global Community of Practice on Scaling Development Outcomes. Julie Howard is Senior Adviser (Non-Resident), Center for Strategic and International Studies (CSIS), Washington D.C.

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