Lessons Learned w/ Taimako Ent.

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Taimako Enterprises Ltd, first detailed here, is the family own and operated agri business that I was first matched with when I arrived in Tamale circa Oct 2013. I worked on and off with them on a variety of projects over the 10 months of my first year. While progress was made and many good things definitely happened, the unintended and unplanned for consequences of the engagement actually yielded the most interesting results. In fact, looking back on the project and knowing what was actually valuable to Taimako is very informative and indicative of the whole small business consulting concept.

As a quick summary, the work at Taimako, at least ostensibly, centered around three main objectives:

  • Production Planning and Organization
  • Financial Management
  • Organizational Structure

These objectives were co-developed between Taimako and BDSA after having worked together for several months to gain an appreciation of the issues facing the company.  In the end, our approach was to try to offer a range of solutions and work with Taimako to pick and choose which elements to experiment with and adopt.

So what actually ended up happening at Taimako? What were immediate outcomes? When will we know about the actual, long-term impacts of the work? And, what is the counterfactual, i.e. what would have happened had we never began the engagement? At this stage we have some answers for the first two questions and can conjecture about the final two.

Key Successes

New Forestry Nursery

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Across Taimako’s multiple business units, the focus of the work shifted multiple times. First it was centered on the food processing scheme, but as the market realities of this business became clearer, it was decided to refocus efforts on the core business of tree seedling production. To this end, Taimako was able to procure additional nursery land near the centre of town, (their existing nurseries are located in surrounding rural areas).

This new plot is located in the Tamale Forestry Reserve, a sort of unintentional city greenspace that once served as a reservoir, and now mainly harbours the local Rastafarian population, wayward youth of all stripes, and various squatter farmers. Taimako worked through both the local government and the traditional authorities (chieftaincy) to secure a 2 acre parcel of land near the roadside. In the course of only few months, they were able to clear the land of many years of accumulated garbage; erect several structures, including a guinea fowl hatchery, shade cloth area, and a basic mosque. In short,covert an underutilized area into a beautiful nursery with thousands of tree seedlings, exotic plants and samples of local pottery .

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While the rows were not in straight lines and no one could tell exactly how many trees were in each one, as I would have liked, the nursery seemed to happily straddle both order and chaos. We were able to implement simple recordkeeping, inventory and accounting systems to track sales and expenses across the business and made progress towards organizing their production methods. In the end, this new nursery has been a remarkable success for Taimako. It has helped them find new markets for their products; it has reinvigorated and refocused the management on their core business of tree seedlings; and it has helped them become more independent of the highly variable government contracts that were once their mainstay.

Community Tree Sales

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This new pilot initiative was developed by Taimako after encountering many frustrations working with the government sponsored afforestation project known as SADA. There have been many tree planting initiatives in Northern Ghana over the past several decades. Most have been large-scale, government or NGO-driven projects designed to combat desertification, improve the livelihoods of rural people, and/or to mitigate the negative effects of climate change. While these large, top-down projects have had some success and were able to quickly achieve scale, there have been many issues with sustainability and local ownership after the projects have ended.

This community tree sales idea was borne out of Taimako’s interest in local communities and their long history as traditional herbalists and tree growers. This past year they piloted a “Base of Pyramid” social business model whereby individual families and groups combine resources to make slightly subsidized bulk purchases of tree seedlings and plants for their compounds and surrounding lands. At scale, this will provide a significant and growing market for Taimako’s products and provides a reliable source of tree seedlings and information for communities to champion their own livelihoods. At the same time, it avoids the major pitfalls of traditional, plantation style tree planting schemes, by focusing on small-scale, direct ownership of the trees by individual families.

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This project is expected to achieve a number of very important results. There are the direct quality of life and economic impacts for the individual families purchasing the trees, as well as the indirect social and environmental impacts on the community. The benefits or “returns” on the initial investment on these seedlings could be realized after only a few years of growth and include up to 20 years of production of cash and food crops (mangos, cashews, shea), animal fodder, fuel-wood, building materials and traditional medicines,  as well as a source of shade and wind/rain/soil protection. Each tree that is planted also has the potential to remove 1 ton of Carbon Dioxide from the atmosphere over its lifetime.

BDSA was able to help Taimako with some basic business planning and modeling for this initiative, and to develop some marketing/information materials to share around the community. We also did a fairly extensive survey of grants and potential NGO partners to bring on to scale this project, but so far we are still looking.

Other Minor Successes

Recordkeeping & Evidence-back Decision Making

A significant transformation for Taimako has been in how they perceive the value of detailed recordkeeping and data-informed decision-making. This has been demonstrated in their adoption of recordkeeping books at the nursery and the use of financial modeling to predict the scope of the pilot version of their community tree seedling sales business. A large reason behind this transformation has been in closing the loop between collecting data, manipulating it in order to reach a conclusion and acting on that new information. Having seen this process come full circle, Taimako has realized the value and the potential to benefit their business.

Transparent Business

A primary objective of Taimako’s for this project was to raise its level from a large, but relatively opaque family business, into a more open, transparent and professional enterprise that could be easily be partnered with. Through a mix of financial policy development, labour practices, and written documentation, Taimako is now in a much better position to communicate and present its business to investors, granting foundations, financial institutions and other partners.  Using the goal of securing impact investment or grants as unifying force behind this work, helped focus efforts on a tangible outcome and drive the development in a cohesive way, even if partnering is still some time into the future.

Challenges & Failures

 

Processing Plant and Mango Plantation

While progress was made in other areas, these two business units were put on the back burner for the time being. The processing plant is awaiting an injection of capital, but more to the point it needs a passionate champion to take ownership and help drive it forward. This might come in the form of new employee or through partnership with other producers. Either way, the need and potential for local food processing and preservation is just too high to let this initiative sit idle for long. As for the mango plantation, with the advent of the rainy season, the need for regular watering, vigilance against brush fires and other direct interventions has dropped off. The farm is still a few years away from producing a viable crop, but Taimako already has ambitious plans for how to get the most out of this investment.

Over Emphasis on Securing Financial Investment

A main assumption made at the beginning of the project was that Taimako would be seeking outside investment in the near term and some of that money would be used to offset BDSA’s fees. It became clear later in the project that this was not the preferred tactic of Taimako and that they would prefer to self-finance for the time being. BDSA failed to adequately respond to this change and held fast to the belief that the company would be interested in pursuing debt or equity financing, without giving enough attention to Taimako’s actual financing requirements. This also stems from the current mania for financial products in the world of development, which assume a lack of capital is the primary stumbling block for companies.

Overemphasis on Production Efficiency and Technical Inputs

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Too much emphasis was put on production efficiency and backend process improvements in the form of planning tools and cost saving measures. By focusing too much on these technical inputs, BDSA missed the larger and more crucial opportunities to help the company clarify their direction and provide less tangible support like coaching and guidance on leadership and family business matters.

Lack of Co-Ownership of Problem Identification

The information asymmetry and power dynamic between the outside “expert consultant” and the passive/receptive client (inherent in these relationships), created a situation where it was very difficult to obtain direction and co-ownership with Taimako. The latter would often rely on BDSA to be both the problem identifier and the solution provider which made it difficult to achieve the necessary commitment and motivation to follow through with changes.

Isomorphic Mimicry

There was a lot of focus put on deliverables such as policies and best practices which were not necessarily valuable in and of them self, but hopefully representative of a deeper change in the organization. Unfortunately, in many cases this lead to the opposite effect of “isomorphic mimicry” where BDSA was helping Taimako look like a better organization without actually changing it to become one.

Limits to the Embedded Approach

The long-term, embedded consultant approach put too much pressure on Taimako to always be making use of BDSA, and put pressure on BDSA to find things to do to keep busy. The embedded approach is more appropriate for a project-based engagement than it is for general business system development. A more flexible relationship where BDSA could have charged a daily rate would have allowed the same amount of work to be completed, but would have made more efficient use of both parties’ time.

Final Thoughts

The 10.5 month relationship with Taimako was both very rewarding and very challenging, with many unforeseen events taking place in the timespan. A strong foundation has been formed for Taimako’s business and many of the right components are now in place to allow them to achieve their long-term goals. The next steps are in the very capable hands of their management, and there will no doubt be many more successes and challenges to face the company in the future.

On personal level, I cannot imagine having a better client and work environment than I experienced with Taimako. The entire family was unfailing open, welcoming and warm and I always felt we interacted in a very direct and honest way which greatly enhanced the relationship. Getting to know the family and being hugely inspired by their vision for both their business and their community at large has, without a doubt, been one of the most satisfying experiences of my life. I can only hope that my contributions reciprocated a small part of this value and that the eventual impact of the work will prove positive and lasting. Thank you to the Taimako family, the staff, and their partners for a fantastic year!

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The Role of an Embedded Consultant

I’ve previously mentioned that I am working as an embedded consultant. What the heck is that? While sufficiently generic to allow flexibility and sufficiently business-speaky to sound plausible, it still leaves a lot to the imagination as to what the role might actually entail. I’m still coming to terms with what it means exactly, but have started cobbling together a definition from various sources over the past few months.

Having worked as an engineering consultant, I know that this basically comes down to offering an informed opinion for money. Depending on your reputation, level of experience and the number of other qualified people who can offer the same advice, you can charge more or less money. Below the surface, however, there is the very important, but intangible element of trust.

I’d say at this point, almost all of my work with BDS thus far has involved building trust or working to maintain it in some way. As Maister & Green state in the “The Trusted Advisor”, “trust is not intuitive or learned at the first impression it accumulates over time…” It is also at least half emotional: technical competence in a field goes a long way, but technical skill without trust is not enough. Interestingly, we also do not tend to trust institutions or policies, because there is no personal relationship there on which trust can be built.

Even though I am here, ostensibly, to offer “technical assistance” with building business, process, and organizational systems, most of my role is not even remotely technical. My work is generally about clearing the paths and addressing hurdles and roadblocks so that businesses can move forward to wherever it is they’d like to go. The only way to do this effectively is to really and truly understand the people behind the business and to take the time to build these relationships.

This advisor/consultant role bears a lot of resemblance to the Enterprise Facilitation approach pioneered by Ernesto Siriolli and echoes the coaching aspect discussed in this article. The main tenants, (in my view, we are still clarifying these as a team) are

1)      Don’t motivate anyone (the business is these people’s lives, they already have enough motivation)

2)      Don’t bring in your own ideas, unless specifically asked to do so,

3)      Look at what is holding the business back in the first place and address these issues at the root,

4)      Work on the business, but not in it (i.e. be a coach and a trainer, not a permanent team member).

To these I’d also like to add the following “Honey Bee” attributes proposed by Anil Gupta in his great TED Talk about everyday innovators in India:

5)      Be sure you are being asked and invited to assist.

6)      Both parties need to benefit from the exchange of ideas.

7)      Don’t co-opt learning only for your own use; share it back with those who developed it.

Okay, this is all well and good you say, but surely there is a role for “hard technical skills”? Besides, Jon, what qualifies you to offer advice or an opinion in the first place? I definitely don’t have all the answers and there are huge swaths of historical, cultural, and technical information and context that I am missing. I won’t attempt to justify it here, as there is a never-ending debate about the value of “technical assistance” as means of delivering aid and development that I’d like to address in a future post.

From what I’ve seen, however, having all the answers is not as important as knowing where to look to connect the dots. For example, I don’t know much about finance and accounting, but I know enough to understand the issues and there are people in Ghana who ready and able to do this work. I am not an expert in mango farming, but connecting with students and faculty at the university up the road we are able to tap into this knowledge. I am also not a forester, but I can connect with a huge number of people through EWB’s vast network and find a specialist when needed. I am also able to draw on my varied experience growing up on a fruit farm, recently building (from scratch) a processing facility, engineering project management, and many other bits and pieces of information that helps fit into the bigger picture. Drawing the parallel to the engineering consulting world, quite often it is nigh impossible to know all the details of every system or component, the most important thing is being able “to know enough to know who to ask” and being able to fit everything together. Business development isn’t engineering or rocket science, but in some ways it is even more challenging as the systems involved are the slow, messy, complex human variety where ambiguity is guaranteed and there’s almost never a perfect answer.

I hope to keep collecting and refining this approach as time goes on, but I’d love to hear your thoughts and ideas in the meantime.

What am I Doing Here? Part III.I: Taimako Enterprises

I’ve talked about how impact investing, socially-motivated businesses and technical assistance are supposed to work together to improve the lives of people in a community, why EWB Canada is involved in this area and why we suspect it to be a powerful leverage point for large-scale impact, and how this connects upstream to larger patterns in the development world. This time around I’ll finally get into the details of what I have been up to.  In short, I’m currently involved with three main projects and partially involved with a few others:

  1. My main focus is as a technical advisor and embedded business consultant within Taimako Enterprises based in Tamale, Ghana. My role here is to work closely with the ownership and management of this growing, second generation family business to catalyze change and to help them realize their plans for the future .
  2. Through another Business Development Services program, the Mobile Business Clinic, I am coaching a small poultry and animal farming business with their growth as a post-investment, early-stage start-up. (I’ll turn this into its own post once the program wraps up at the end of the month)
  3. Within BDS I am looking at Monitoring and Evaluation (M&E) frameworks and internationally recognized social and environmental metrics. The goal is to understand how the social, environmental and economic impacts of many small businesses aggregate to form a lasting positive change in communities and beyond. (This is definitely another post, or even a completely separate blog!)

Taimako Enterprises

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Taimako is where I spend most of my time and where I live. The story of the Taimako’s history, especially as told by the founder, CEO and family matriarch, Madam, Dr. Taimako, is one of the most captivating and inspiring I’ve ever heard. I wish I had a tape recorder with me the last few times she’s told it, but I’ll try to do it some justice here while keeping it brief.

Madam Taimako began as a healer, mid-wife and traditional medicine gatherer in the Northern regions of Ghana. This business soon morphed into the cultivation of traditional herbal plants and shrubs. After losing her husband, the mother of nine faced innumerable odds her, but was able to slowly grow the medicinal/herbal garden and break into the relatively new market for tree seedlings (trees after all have many important medicinal properties). With small steps she was able to expand this seedling business and, in the past decade, Taimako has grown into one of the largest suppliers of timber and fuit tree seedlings in Northern Ghana.

As the tree seedling business was growing, the Taimakos maintained their traditional medicine training and cultivation business, branched into ornamental plants and landscaping, and acquired a large parcel of land from the local chieftaincy to establish a 250 acre Mango plantation (one of the most popular seedlings they produce is mango). Furthermore, in the early 2000s a pronounced need for more senior high level schooling was noticed in the community, especially for those students left behind in the lottery based public school system. This led the Taimakos to establish a low-cost, private senior high school on their property. This school has since grown to an overall enrollment of over 500 students and plans are being formed to build a primary feeder school in the coming years. Finally, as if there wasn’t already a lot happening, the Taimakos are in the middle of establishing a food processing business to capitalize on the eventual output from their mango plantation and the seasonal gluts of produce and grain crops.

Through the years, the business has operated in a fairly informal manner with limited record keeping and management systems in place to track employees, costs and revenues. Taimako was introduced to EWB and BDS through a chance meeting several years ago and a relationship was built after a series of discussions. About a year ago, BDS was brought onboard to help address their self-identified need for improved business systems and overall organizational structure. So, this is where I’ve been working for the past four months as an embedded business consultant.

Below is a quick overview of what I am working on within each of Taimako’s business units with some pictures to bring things into focus.

Seedling Nursery

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This is still by far the largest aspect of the Taimako’s business and produces the most revenue as well as the most challenges. There are three seedling nurseries located in the same general area just outside of town where a dam reservoir provides a year round water source. These nurseries collectively produced well over 1 million seedlings last year (!), with the primary contracts going to the government afforestation program known as SADA. Local mango farmers, municipalities and private businesses make up for the rest of the sales. The varieties of trees currently being cultivated include:

  • Mango: These trees are sold in large quantities to established mango farmers and government initiatives to develop the mango industry in Northern Ghana.
  • Mahogany: These trees are sold to farmers and land owners for land stabilization. They are also sold to government agencies as part of reforestation programs. Mahogany is also vastly used in the timber industry.
  • Shea: Shea trees are sold to farmers for income generation and to reforestation programs.
  • Ceiba, Kpalga, Ebony, Kacia, Albasia, Luccina, Eucalyptus: These trees are sold for reforestation programs and land stabilization. They are not produced in as large quantities as Mango, Mahogany or Shea.

The main challenges involved with this business are organizing the nurseries and work so that better records can be kept and waste and seedling attrition reduced. I am currently looking into ways of tracking the inputs and outputs and how the overall process can be improved and made more reliable.

Mango Plantation

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As a way of diversifying their business (if you haven’t noticed, they really like diversity) and using the output from their seedling operation, Taimako establish a 250 acre plantation near Pong-Tamale in 2011. Since the trees are still growing and have not yet started fruiting, the work on the plantation is mostly pruning, manuring, mulching and watering. The latter process is accomplished via a tractor filling a large water tank from a nearby reservoir and laboriously hand watering each of the trees [~100 trees/acre x 250 acres = 25,000 trees x 4L of water /tree, every third day in the dry season (Nov-Feb) – it adds up quickly!]. There was an estimate done by another company for a large-scale irrigation system, but it was prohibitively expensive. What I am currently looking into is how such a system could be implemented piece by piece over the next several years, and what sort of farm record keeping would help facilitate this kind of ROI decision-making (i.e. cost of tractor fuel vs. irrigation system over 10 years).

Processing Plant

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This is where I’ve spent most of my time so far. From a previous grant, Taimako established a medium scale food processing facility on their property complete with a solar tunnel food dryer. Though this business has been operational for a few years, it hasn’t really taken off as hoped do other priorities. Over the past year, it has become increasingly clear that a steady flow of cash from this business unit would add much need stability to the overall enterprise. Furthermore, local food production, post-harvest losses, food security and rising transportation costs have been hot topics of conversation in Ghana and around the world lately. This food processing facility should be a win-win for Taimako and the local community if it can smooth out the large peaks and valleys of seasonal food production (mangos, tomatoes, groundnuts, etc.) by extending the shelf life through solar drying, juicing, and other preservation methods. It should also, reduce transport costs and dependence on imported foods (why are we eating tomato sauce from Italy?!), provide a number of relatively well-paying, stable jobs and provide a guaranteed market for local farmers to sell their products.

The building is currently being renovated to meet the latest health and safety codes (tiling, glass windows, A/C) and should be fully operational later this spring. I have been doing market research on the peak season of various crops, looking into the production line design of the plant, and doing some research into solar drying and other preservation methods.

The plant is currently slated to produce the following products:

  • Unimix Tombrown (mixed ground corn, soya, rice and groundnuts – used as a sort of morning porridge)
  • Dried mango, pineapple, banana, and coconut chips
  • Ground ginger and chili powder
  • Roasted groundnuts and groundnut paste (peanuts and peanut butter) and roasted sesame
  • Cassava, yam and plantain flour

So there you have it, Taimako in a nut shell! There is quite a bit going on and I’m constantly learning some new thing or another which is a blast. Beyond the more technical work on the business units themselves I am also working with the Taimakos to establish the accounting and record keeping systems befitting of an operation this size. We are also discussing company culture and philosophy in the way they organize their policies towards the community, the environment and their workers (they are already way ahead of what most businesses are doing, but want to be more deliberate about it).

I want to write a lot more about the role of a technical advisor and embedded consultant and some of the advantages and challenges with this approach, but I’ll save that for a future entry. In the meantime, don’t hesitate to question, comment, challenge or suggest a new topic.

Here are some more photos:

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What am I Doing Here? Part II: Social Enterprise, EWB and Business Development Services

About 3 or 4 years ago EWB found itself amidst a swirling movement of new thinking on development issues, disillusionment with traditional economic strategies, and the rise of the middle class in Africa, amongst other trends and developments. To understand a little better how a group of dyed in the wool, pocket-protecting, calculator mashing engineers became involved with business development work in Africa, it helps to know some of the recent history of EWB and the amplifying and colluding trends of business, finance and development of the past couple years.

In the last post I covered a few thoughts on the development world in general and the current state of affairs with regards to social finance and impact investing. This time I’ll drop down to the meza-level and explore a few of the main theories and concepts that have affected EWB’s current thinking and direction and provide an overview of our activities in these areas. This should help explain why Small and Growing Social Businesses (SGSBs) are a large part of EWB’s “systemic innovation” theory of change and how this connects upstream to the impact investing world and downstream to what we are doing on the ground in Ghana and Zambia.

If, after reading, you are interested in supporting this work, then head on over to our “We are” page which is part of EWB’s year end fundraising campaign.

Concepts in EWB

EWB has always prided itself as being on the cutting edge of the latest thinking in the world of international development and, often, one of the few organizations small and versatile enough to immediately begin putting these theories to the test. Another strength of EWB has been its ability to gather and synthesize ideas and concepts from different fields (engineering, management consulting, finance, business, social science etc.) to create something unique. Here are a few of the main concepts that have had a significant influence on EWB over the past few years:

Systems Thinking – Something every engineer is intimately familiar with is the world of systems and how the interactions between individual parts work together to create a greater whole. Be it in control theory, system-on-a-chip design, assembly line optimization, or chemical processes, engineering more often than not is about combining increasingly smaller components into increasingly larger and more complex systems. This thinking began entering the world of business and management consulting beginning with the “Fifth Discipline” by Peter Senge in the early 90’s and has since been adopted by many other disciplines. The aim is take a highly complex ever-changing system of players and interactions and approach it from a holistic perspective instead of piece-by-piece. The ability to better understand the system as a whole allows one to better find and exploit leverage points, synergies, and loopholes and nudge the system towards a new paradigm instead of just patching up symptoms.

Social Enterprise – This fairly ambiguous term has been used to describe everything from a purely non-profit organization delivering only social good all the way to a purely for-profit, traditional business which just happens to be generating some social good (i.e. jobs, health, education) as a by-product of its primary profit incentive. While no one can really decide where to draw the line, the basic concept is that a social enterprise is an operation that generates highly scalable, wide-reaching, positive social or environment impact to its community, stakeholders, or customers. These are typically headed by social entrepreneurs who are very much like regular entrepreneurs, except instead of starting a business they aim to start a movement. You can read a lot more about the concept in the excellent book “How to Change the World” by David Bornstein.

Blended Value – This is another slippery concept which, like social enterprise, is open to broad interpretation. At its core, however, blended value is about businesses or non-profits delivering a blend of economic, social and environmental value as part of it mandate. This takes the concept of “triple-bottom line” a bit further by arguing that these aims should be part of a holistic approach instead of just separate categories. (Unfortunately, due to the nature of some businesses the blending is more like oil and water than milk and coffee). Read more about it here.

SGSB/SME – Small and Growing Social Businesses or Small and Medium Enterprises are two terms used to describe up and coming businesses that have the potential to scale up and deliver far-reaching impact across many communities.

Base of Pyramid – This concept holds that there are an awful lot of people who do not make or spend much money in the world and are hence largely ignored by most mainstream businesses. The theory goes that if a company can reach BoP consumers with their products or services, this will have a profound impact on the overall economy (for better or worse). By serving the needs and demands of the base of the pyramid effectively, companies can make large returns from relatively small margins due to the economies of scale. Read more here.

Participatory Approaches – Based on the work of Robert Chambers in “Whose Reality Counts?” participatory approaches and methods are about reversing the typical top-down, expert-driven power dynamic of traditional development. Instead of designing (usually poorly) the project from a far, implementing something using experts from overseas and leaving. P.A. is about leaving the conception and control squarely in to the hands of the people who are living with the project and giving them discretion about how and where to use outside “expert” help. EWB attempts to do this (though not perfectly) through being a value add partner that local businesses and governments can bring in as they choose. We are aiming to be “on tap”, not “on top”, but there are many systemic issues in the nature of development that prevent this from truly being the case.

EWB and Systemic Innovation

Through its earlier work (2005-2011) in water and sanitation in Malawi, food system in Ghana and Burkina Faso, and governance and rural infrastructure also in Ghana, EWB was exposed to many levels of interactions from high level aid decisions, to local government program implementation, to the effect of these programs on the citizens of these countries. Through this perspective a trend started to emerge that was starkly different from much previous technology-based development thinking. The realization was that instead of focusing on broken water pumps, low harvests, ineffective government programs and other inputs, outputs or technologies, a better way to achieve lasting, resilient, locally directed, and scalable change, was to take a much broader approach. Instead of focusing on implementing “solutions”, EWB decided it was better to first understand the “systems” from which these symptoms manifest and design ways to create change from within. This systemic approach has since become EWB’s specialty and has allowed it to use its limited resources and people on the ground much more effectively. This approach was codified after much internal debate and dialog into EWB’s current vision as a leader in “systemic innovation” in January 2012.

This grand sounding idea, while flashy, modern and, yes, a little presumptuous, has definitely left many a head scratching both inside and outside the organization. How exactly does one plan to create systemic change a priori? Can these efforts be measured, evaluated, attributed, correlated to outcomes? How big of a system are we talking about? The past two years we have been grappling with these questions and experimenting with a new model as an incubator of systemic innovations and social enterprises. Instead of operating like a traditional NGO with projects and programs, EWB works more like a venture capital firm for social entrepreneurs to pitch their ideas and get “investments” of people, connections and some funding.

Business Development Services Africa

While EWB has maintained its work in water and sanitation, governance, and agriculture; through its iterative progression, it has come to focus more on the business sector as the vehicle with the most potential to deliver large-scale impact. Business Development Services Africa was spun off of EWB’s successful work in agriculture value chains, (itself an iteration of working with farmers and noticing major barriers and inefficiencies in the way inputs and outputs flow along a value chain). The BDS venture was pitched with the idea that expanding the number and impact of SGSB’s (especially in the agriprocessing sector) could leverage massive higher order effects upstream for farmers and suppliers of raw foods and downstream by creating jobs and locally sourced food products for BoP consumers.

This leverage point at small businesses within the system of a local economy has been repeatedly cited by politicians, economists and NGO’s around the world as a primary source of jobs and economic growth (both major issues and topics other posts for sure).  The question is how to rapidly and effectively accelerate these companies while not creating even more problems down the line. The answer may be in combing ecosystems of socially and environmentally driven companies together along a value chain to produce the most efficient outputs while doing the least amount of collective harm. No one has quite figured out how to do this yet and the North American model surely isn’t the most inspiring, but BDS hopes to push forward the thinking around this and help find new ways of operating.

BDS is a relatively new venture within EWB and is still very much in a start-up, exploratory stage as we tighten our business model, experiment in different roles and develop our theory of change. Within the next several years, it is hoped that BDS will become its own separate entity; based directly in the countries it has operations and employing mostly, if not all local staff. As of right now, we are only operating in Ghana and Zambia with a handful of client organization, but aim to grow and diversify as we iterate. Our current numbers on the ground as of the end of this month will be four in Ghana and five in Zambia.

Our model of assistance is meant to harness the power of small business to develop a self-reliant and sustainable form of poverty reduction and social betterment. BDS only works with clients that request our services and are able to demonstrate strong entrepreneurial drive and business models with tangible social and environmental impact. In essence, we are helping entrepreneurs build better business systems, and we are connecting those entrepreneurs with the right investors to scale up. Our solutions are co-developed, co-owned and co-executed with the entrepreneur and, therefore, have their buy-in from the beginning.

There are a variety of systemic failures in markets, institutions, and rules and norms that contribute to the demise of many small enterprises. This makes it harder for entrepreneurs to access “growth capital” to expand their businesses. But, there is more to it than that: businesses also need to be able to utilize that capital efficiently and sustainably in order to effectively benefit from it. This is why BDS is primarily focused on capacity development of entrepreneurs. From our perspective, both investors and entrepreneurs are losing out because often the underlying issues that make businesses “unbankable” are surmountable with the right approach. As David Packard (the P in HP) said, “More organizations die of indigestion than starvation”.

BDS is piloting and testing its operation in three main categories:

–          Pre and post investment technical assistance through embedded consultants: Here we partner with pre-investment (start-up to growth stage) businesses and work with them to streamline their business and technical systems, and prepare business plans and record keeping for investor due diligence. We also partner with impact investors and work with them and the client organization to ensure a smooth transition post-investment. That is, direct, client-based consulting to understand, diagnose and remove the barriers that stand in the way of the client’s objectives.

–          Business incubators: In this role we work with existing NGO or government lead business incubation programs to develop the tools, training, selection processes and monitoring and evaluation frameworks for the incubated businesses.

–          Mobile business training clinics and coaching: This stream, currently based in Ghana, brings together cohorts of small business leaders in groups from each geographical area for a three-month training and coaching program delivered by local Ghanaian business leaders. Training modules include management and leadership development, finances and accounting practises, and project management techniques. The training sessions are accompanied by regular coaching sessions to help the small business owners to immediately begin implementing what they’ve learned.

We are still very much working on the overall direction to take to increase our reach and effectiveness and continuously learning and discussing with local partners about what needs are not being met. In particular a lot of work needs to be done around understanding how these intangible and unpredictable things like “business success” or “positive social and environmental impact” can be influenced, quantified, qualified, compared, measured and/or evaluated. As we increase our understanding this system, we will be narrowing in our specific leverage points and value adds.

In the final installment, I’ll address the day-to-day operations here in Tamale including my work with Taimako Enterprises, Mobile Business Clinics, and some of BDS’s other projects and clients in Ghana and Zambia.

Thanks for reading!