Services in the Agricultural Sector
In the wake of liberalisation, privatisation, structural adjustment programmes and the transition from centrally-planned to market economies in many countries, service provision by state bureaucracies and centralised administrations is forced to adapt to the changing circumstances. In the field of agricultural research and extension, services are increasingly being restructured, either to allow for service provision by the private sector and non-profit agencies, or to improve the performance of public service organisations. For the private sector, this represents a chance for new business opportunities in the field of service provision.
For the public sector, this represents new challenges with regard to the transformation of its organisation, role and functions, as well as its relationship with civil society and market actors. Public sector extension organisations will have to improve their performance through public sector reform programmes following New Public Management principles of efficiency and effectiveness. Traditional approaches of service provision (such as Training & Visit) which have proved to be too expensive and too centralised have to be phased out or restructured in line with modern principles of service provision. New approaches suggest that other actors in the area of extension be considered, a clear service and client-orientation be developed and farmers be involved in innovation.
Rural Organisations as Service Providers
In the last decade, governments have increasingly withdrawn from public sector agricultural services. Only part of the missing services is being replaced by the private sector, limited to those locations that promise financial returns to private enterprise. Wherever farmers are unable to pay for services, the gap between demand and supply of services widens.
Rural development policy therefore calls for a greater role of the "third sector" in development. NGOs and the organised farming sector (farmer organisations, professional producer associations, co-operatives, NGOs and other private-collective associations of rural people) are expected to take over local service functions although they may not always be prepared for this task.
Producer associations, for instance, are usually established to provide services such as:
efficient supply of production means and efficient marketing systems for the association members
improving market access and market influence for the individual enterprise
joint production and processing by making use of market niches.
Experiences have shown, however, that producer associations become sustainable only by following economic principles, i.e. by attaining regular income, by using resources economically and by charging fees for service delivery.
When establishing a producer association, choice of location plays a role for social as well as economic reasons. First, members should be reachable within a day, as producer associations depend on mutual confidence based on practical experience and evidence. Locations with existing organisational structures certainly have a higher potential. In addition, also production or market sites play a role for the choice of location.
A preparatory phase is highly recommended before setting up an association. It should be devoted to explain the concept to producers, build up confidence, provide information and training by using methodologies such as group consultation, and promote the exchange of experiences among producers.
Other success criteria in the process are:
starting with a small number of motivated producers who are ready to contribute
making use of selection criteria such as entrance fees and enterprise vitality
taking care when selecting the management of the association in order to obtain the right mixture of personal competence, trustworthiness, and endurance.
Service system analysis
This is a tool that helps to put up service systems in such a way that they correspond precisely to existing demands. Its first step consists in choosing a service perspective. This refers to the fact that services are needed and organised around different issues, such as:
Services needed and organised around commodities. This includes all services related to the production and post-production of a specific commodity (e.g. cotton, tomatoes, cocoa, etc.). A subset of this commodity service system would concentrate on post-harvest operations, i.e. all services related to operations, from harvesting of products to consumption (often referred to as post-harvest systems).
Services needed and organised around the application and management of agricultural inputs such as water (e.g. irrigation systems), land or machinery.
Services organised in service sectors providing elaborate service products, such as financial service systems, education systems or innovation systems (i.e. services related to the development of a particular innovation, including research, information, input supply etc.).
Services in professional fields that need to build on other supporting services or legal arrangements to be functional, e.g. a veterinary service system or a plant protection service system where practitioners need to work with laboratories, scientists and supervising agencies.
Once a particular service perspective has been chosen, the next step consists in describing and analyzing the system in question. You will find the details on this approach here.
This website also provides a toolkit to help you in the orientation, analysis and planning of various aspects of services for rural development. Instruments and methodologies are offered for aspects such as the clarification of roles in service provision, service networks, user charges, benchmarking in service provision and governance mechanisms.
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