Innovation Systems Perspective and Value Chains Approach for
Development: Concepts and Principles
National dairy forum, Addis Ababa, Ethiopia, 23-24 November 2010
Berhanu Gebremedhin, ILRI/IPMS
Presentation Outline
The Impact Pathway
Innovation and Innovation Systems Perspective
Value Chains
Integrating ISP and Value Chain Approaches
Resources(Staff time, finance, equipment/materials, transportation etc)
Activities(Problem identification,
research design, implementation,
evaluation)
Outputs (technologies, institutional/Organizational/policy recommendations, publications, briefs etc)
Outcomes (Research outputs are taken up/adopted by intended users)
Impact (economic,social and environ-mental changes)
The Impact pathway
Commodity versus technology development approaches
Commodity development: an approach that is focused improving the productivity and profitability of the commodity based on analysis of constraints and opportunities along the value chain Major constraints can be related to technology, markets,
institutions, service delivery, and organizations. Is comprehensive
Technology development: an approach that is focused on promoting a production technology in order to alleviate the technical production constraints or expand the technical opportunities of a commodity Presupposes that the key constraint is the technology
What is Innovation?
Successful application of “knowledge” to economic, social & environmental benefit.
- Knowledge creation, adaptation, dissemination and use of knowledge, not just knowledge creation (Invention)
- Both new knowledge and novel combination of exiting knowledge
Why ISP?
Criticism on development interventions for having low impact
Knowledge/invention comes from multiple sources
Need to exploit the complementarity between researchers and development stakeholders Roles
Problem definition Research design Result validation Implementation
Their knowledge systems Scientific/modern knowledge Indigenous/local knowledge
What is a Value Chain? An agricultural value chain is considered as an
economic unit of analysis of a particular commodity (eg. milk) or group of commodities (eg. dairy) that encompasses a meaningful grouping of economic activities that are linked vertically by market relationships.
A value chain encompasses a set of interdependent organizations, and associated institutions, resources, actors, and activities involved in input supply, production, processing, and distribution of a
commodity.
A value chain entails the addition of value
Value chains are also the conduits through which finance, information and technology are disseminated
Business development services
Services that play supporting role to enhance the operation of the different stages in the value chain and the chain as a whole
Infrastructural services (market place development, roads and transportation, communication, energy supply, water supply)
Production and storage services (input supply, genetic and production hardware from research, farm machinery services and supply, extension services, weather forecast, storage infrastructure)
Marketing and business related services (market information, market intelligence, technical and business training, facilitation of linkages of producers with buyers, organization and support for collective marketing)
Financial services (credit, saving, risk insurance)
Policy and regulatory services (property rights, market and trade regulations, investment incentives, legal services, taxation)
Production
Post-harvesthandling
Processing
Retailing
Consumption
Trading
Trading
- -
Market information and intelligenceMarket information and intelligence
Financial servicesFinancial services
TransportationTransportation
CommunicationsCommunications
Govt. policy regulationGovt. policy regulation
Tech. & business training & assistanceTech. & business training & assistance
Production input supplyProduction input supply
& Business Support Services
ResearchResearch
The Value Chain
Transport
Input Supply
Framework Conditions
INSTITUTIONS
Knowledge Generation
Knowledge Adaptation
Knowledge Dissemination
Knowledge Application + Use
INNOVATION CAN OCCURE ANYWHERE IN THE VALUE CHAIN
Agro-industry inputs and services Agricultural
Production
Agro industryProcessingMarketingRetailing
LEARNING
ACTORS+ACTIONS+INTERACTION
Value additionValue addition
Integration of Value Chain and Innovation
Innovation possibilities in VC
Input supply Production and post harvest Marketing
Organization and coordination of marketing functions
Market information and intelligence Market institutions Market infrastructure
Technical assistance and training Financial services Policy and regulatory issues
Integration of Value chain and Innovation system perspective
Target Group Identification
Broad understanding of the Livelihood of the Target Groups (Unit of analysis is the HH)
Prioritizing enterprises within the Target Group
Identifying and describing the Value chain of priority enterprises
National Innovation System- Generic (dealing with science and technology at National Level)
Intervention Based Innovation System (Based on the priority problem)
Agricultural Innovation System-Generic (dealing with Agricultural S & T)
Commodity based Innovation System (dealing with the entire value chain of an enterprise)
Prioritizing the key component of the Value chain-1st level priority setting
Prioritizing problems within the priority key component identified
Analysis of the priority problems identified
Identifying potential Intervention
Identifying feasible Intervention
Planning, Implementation and Evaluation
Screening (Ex-ante assessment)
Dissemination, Utilization by end users, and scaling out
Thank You for Your Attention!!!
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