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6th Knowledge and Learning Market: Value chains demystified

   Levelling off the participants of the 6th Knowledge and Learning Market of the International Fund for Agricultural Development (IFAD) was the session on demystifying value chains towards a market-driven IFAD impact pathway. Majority of the KLM6 participants were the implementers of IFAD-funded grant and investment programs with the government of the Philippines.

   IFAD is one of the development organizations that gives value chain a significant dimension in their projects. With the diverse profile of the participants from Department of Trade and Industry-Rural Micro-Enterprise Promotion Program (DTI-RuMEPP), Department of Agriculture-Cordillera Highland Agricultural Resources Management (DA-CHARM), Department of Agrarian Reform (DAR) Converge and other grants and loans projects in the Philippines, different levels of knowledge and perceptions on value chains exist.

   Dindo Campilan PhD, Senior Food Security and Livelihood Specialist under the Global Program for Social and Health Sciences of the International Potato Center (known by its Spanish acronym CIP) and the Programme Leader of Food Security Through Asian Roots and Tubers (FoodSTART) shared the seven (7) things that the project learned about Value Chain Development.

1. Supply chain, market chain and value chain - Supply chain seeks supply push or self-optimization. It ensures supply or production as required. Market chain links producers to markets and maximizes profit. Value chain on the other hand optimizes value, nurtures chain-wide relations and seeks multiple values.

2. Livelihood, business and enterprise - Livelihood is a means or ways to live while business is a profit-making activity through goods and services. Enterprise is facilitated through organizations and norms for business.

3. VC analysis, action and approach - VC analysis usually produces the activity-actor map. It identifies the resources available, the needs and the existing opportunities. It also gives recommendations and plans. VC action is a more concrete activity which may include collaborative arrangements, interventions, action learning and innovations. VC M&E and knowledge management works on the documentation, reflection from the processes and experiences and knowledge sharing of the lessons learned. It is important that one has the VC perspective to be involved in this kind of activities. It is the way of thinking, knowledge and experiences as well as the values and beliefs within the value chain perspective.

4. Household, collective enterprise and learning group - A collective enterprise is composed of different households who agreed to do business together. The enterprise is common  to each member households. While a learning group is consist of different household enterprises agreed to learn together about business. 

5. Rural development program, VC program, support to VC - FoodSTART is collaborating with different country programs in the Philippines and these concepts were differentiated through the program's experience in partnering with CHARM, CONVERGE and RuMEPP. CHARM is a rural development program with different components and value chain is one out of its five (5) program components. For CONVERGE, the overall design of program is value chain development will involve all stages of VC devt. RuMEPP's case on the other hand is a program which supports the value chain development. It is involved in one or more area within the process of VC development.

6. VC actors, stakeholders, facilitators - the responsibilities of each value chain players shall be clearly defined and established in order to avoid potential conflict of roles and interests. Value chain actors are the actual individual who are involved in the activities within the chain. The stakeholders are the ones who will be affected by the activities happening in the chain and the VC facilitators are the people who support the VC devt process. These may be the organizations who give trainings or facilitates learning of value chain as concept and guide the actors in applying the concepts in the real VC process.

7. VC innovations: technological, institutional, commercial - VC involves innovations which can be technical (i.e. improved crop varieties), institutional (i.e. communal farming, marketing contracts for grade-A products, agreed standards on differentiated pricing), and commercial (i.e. product positioning in specialty shops, branding in promotion). These innovations fall on three strategic objectives -- value creation, value addition and value capture.

   Understanding the whole concept of value chain development is very crucial to the program implementers. It helps in articulating the roles of VC actors, stakeholders and facilitators. It is significant to have a clear set of value chain objectives to design appropriate plan of action in order to achieve development goals of the individual programs.

   The 6th KLM was held on 27 November 2012 at Richmonde Hotel, Ortigas Center, Pasig City, Philippines.

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