IDENTIFYING A STANDARD CAPACITY MEASUREMENT OF FARMER ORGANISATIONS
By George Z Goliati and Opher Mwale
As we head towards establishing the actual extent of utilisation of donated collective marketing structures, the determining factors and relationship with the FOs standard capacity measure, we are required to identify a suitable capacity index. The goal of the study is to be able to precisely predict the outcomes of our partnership investment on a given FO based on its capacity performance index, and in fact modify accordingly, in order to make effective and high-returning investments.
In 2007, the Consortium for the Development of a Database for Farmer organizations in Malawi (CoDeDaFO), developed an indicator for measuring the sustainability of farmer organizations (Mapira et al., 2010). The key indicators identified were governance, business and representation. Maganga (2017) studied performance of cooperatives in order to answer the question "how to improve the performance of smallholder cooperatives in Malawi?". According to Maganga (2017), the major challenge facing smallholder agriculture cooperatives in Malawi is their poor performance. Maganga argued that the CoDeDaFO and other researchers focus on sustainability mistreated farmer cooperatives as investor-oriented businesses unlike user-oriented business.
Maganga (2017) integrated with his own findings, and identified a total of 18 factors as contributing to poor performance of smallholder agricultural cooperatives. Of these, eight were unique to Malawi and therefore represent a contribution to the body of knowledge on the subject. The eight factors include the fact that: inadequate cooperative training is offered to cooperative members, little or no governance training is offered to board members, members have limited understanding of shares, members have limited understanding of dividends, member pricing expectations are not aligned to cooperative expectations, donor-supported managers are not trusted by cooperative members, founder directors often do not respect governance structures and most cooperatives do not organize general meetings. Thereafter, a performance improvement framework called the Maganga PISHAC Framework was developed by combining the identified factors into four core categories, namely; objectives, knowledge, skills and attitudes (Maganga 2017). According to Maganga (2017), the Maganga PISHAC Framework can also be customized for use in other countries. However, the Maganga PISHAC does not quantify the capacity of an FO.
To assist FOs strengthen their capacities and, ultimately assist their members, Alliance for a Green Revolution in Africa (AGRA), in partnership with the African Investment Climate Research (AFRICRES), developed a capacity assessment framework and tool aimed at providing a capacity building profiling tool to be used for strengthening FOs and agricultural service providers (SPs) throughout Africa (AFRICRES, 2014). AFRICRES has been conducting a lot of research on cooperatives performance between 2012 and 2014 to finally come up with the capacity index. However, Maganga did not mention anything about this and it is not known if government or NGOs have been using it to improve the capacity of cooperatives in Malawi. The AFRICRES capacity performance index has seven categories that include participation, accountability, strategic potential, income diversity, marketing, advocacy and professional capacity. The AFRICRES CPI quantifies the FO capacity, it has the ability to assess and distinguish capacity of two or more farmer organisations. Therefore it provides a better tool for measuring the capacity of the FOs.
The capacity performance index (CPI) serves two main purposes which are viz-a- viz identifying capacity strengths and weaknesses of Farmer Organisations (FOs) while ranking them according to their performance in eight capacity indicators which are accountability, income diversity, professional capacity, strategic potential, production management, marketing, participation and advocacy. FOs at the lower level of the rankings will be considered as primary beneficiaries for support to build their systems and competencies until they graduate to the level of Service Providers (SPs). FOs will be ranked into three levels as shown in table 1 below. Level 1 constitutes primary beneficiaries of the capacity building exercise while Level 2 constitutes FOs which requires some capacity enhancement for them to qualify as SPs. Lastly; Level 3 constitutes FOs that can be used as Service Providers which are capable enough to provide services to Level 1 FOs.
Primarily, the study will try to establish the extent of using the warehouses/VACs and the determining factors. Simple descriptive stastics and correlation will be used to analyse the data. The main objective of this study is to examine the use of warehouses/VACs in relation to the capacity of FOs using a two stage analysis. The capacity performance index (CPI) developed by AFRICRES (2014) will be used to assess the capacity of the FOs in the first stage. The CPI will also explain the overall outcome of the Service Providers project, whether it considered and affected the capacity of the FO or not. In the second stage, a regression model will be used to examine the relationship between the use of the warehouses and/or value addition centres and the CPI scores. The results of the analysis will indicate if the capacity index of FOs is related to use of donated warehouses or value addition centres. The findings of the study will provide empirical measure of the extent of utilisation of the collective marketing structures and the relationship to FO capacity.
This study does not only aim to establish the extent of utilisation of collective marketing structures, its ultimate aim is to establish how the utilisation of the structures is related to FO capacity.
