Value chain analysis workshop-Nov2011

Value chain analysis workshop held at Zen Garden, Nairobi on 17–18 November 2011

The workshop provided a forum for the exchange of ideas amongst researchers, practitioners of value chain analysis, implementers of technical and organizational change, and those engaged in pro-poor development. The aim of the workshop was to provide guidance in identifying and addressing value chain related needs and gaps as the CGIAR moves into CGIAR Research Programs (CRPs).

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DAY ONE: THURSDAY 17 NOVEMBER 2011

Introduction by Derek Baker

Derek began by welcoming the participants and introducing workshop with a brief presentation on the overview of the purpose, goals, outputs and approaches of the workshop.

Goals

• Rationalize and co-ordinate thinking on VCs and their contribution to pro-poor development
• Create commonalities and synergies in value chain research for development approaches across the CGIAR and partners
• Define tools that we have, need, and need to develop
• Cross-disciplinary dialogue
• Enhanced quality of partnerships

Download the presentation – Introduction and welcome

Value chain analysis: What it is, what we know, and what we need to know

Karl Rich then gave a more detailed presentation of value chain analysis. He began with a definition of value chains and value chain analysis then presented some examples of value chain analysis in past ILRI projects and discussed what gaps exist. He then ended with an overview of emerging issues and challenges.

How ILRI has perceived value chain analysis:

• Value chains are more than flow charts
• Value chains can include social, monetary and other value; involve a set of actors, transactions, info flows and institutions that enable value to be delivered to the customer
• ILRI’s experience has been in rapid appraisal of value chains

Key gaps in value chain analysis are in:

• Having available, consistent and sufficient data sets comparing value chains
• Sampling within chains
• Looking at ex ante impacts within the chain, (empirical rigour).
• Future in value chain analysis will have to bring together different experts in many areas to do value chain analysis in a more structured way, to improve uptake.

Framework used in workshop:

• Looking at motivation, tools, measures and communication
• Starting with a value chain question, appraising it, looking at case studies, how it can be piloted and scaled up
• Second tool will focus on measuring, equity, social justice etc.
• How to communicate results across the chain and to actors
• How to apply of value chain analysis within the CRPs

Download the presentation – Value chain analysis: What it is, what we know, and what we need to know

Value chain research: Some experiences by Jacques Trienekens, Wageningen University

Theoretical concepts Considered four streams in Value Chain Analysis (VCA): supply chain management, economics (governance of transactions), social networks (people relationships), global value chain analysis (the entire supply chain analysis from perspective of those in power).

Key concepts

• VCA is about choosing markets and channels including networks of actors, governance and value added production.
• Value chain upgrading: the upgrading options available including partnerships.
• Value chain constraints: what limits market access.

Governance forms There are a number of coordination mechanisms (price, volume, quality etc.) not just one. There may also be combinations of these, for example, a combination of market price and third-party quality. Thus, the issue of governance is not always as straightforward as it is often portrayed in the literature. Markets and value chain access are influenced by contractual coordination mechanisms, or informal contracts and social networks. Users need to find the right coordination mechanisms for their chains.

Relationships that affect the performance of value chains include value added processes, cost of processing but the performance at also key (which is not often researched). The performance categories of a value chain include- efficiency, responsiveness to customers, quality and flexibility, which include among others production costs, lead times process planning, product attributes and market adaptability.

Performance indicators Literature review revealed four broad categories of performance indicators: efficiency, responsiveness, quality and flexibility. These could be applied to ILRI’s value chain analysis.

Two examples of value chain research show that value chain analysis is useful for indicating the direction to take to upgrade the value chain:

• Vegetables in China: Guanxi traditional social networks were found to influence access to modern markets.
• Fish chain in the Philippines: Fishermen that had contracts with processors were more willing to use sustainable practices.

Download the presentation – Value chain research: Some experiences

Value chains from a development perspective by Nicoline de Haan

Overview

• Value chains adopt a broader perspective.
• There is an extra level of complexity and dynamism in value chain analysis in the context of the development arena and informal sector.
• Value chains can be useful as a policy tool when interacting with governments.
• There is need to enhance capacity to do value chain research.
• For value chain analysis, more work is needed on governance, especially from the policy perspective, governance hot spots, and concentration.
• The best risk managers are the people in the chains and they must be brought on board.
• Value chain analysis helps to understand the sector better and enables better targeting of interventions.

Value chains from a development perspective

• Value chains are one of the revolutions in agricultural research that includes green revolution to farming systems to livelihoods. Focus on value chains could indicate a moving away from producer to users?
• Value chains are not necessarily clear or formal e.g. in livestock research which has very informal value chains. Organizations like ILRI should be honest brokers in processes, to bring together the technical and policy arenas, capacity building, public and private partnerships and policy setting to help players make decisions. Focus on issues like equity, inclusivity and collective action.
• Among the focus areas could be livelihoods improvement, food safety and health chains. There is need to understand the development perspectives within the political economy and how these affect value chains.
• Analysis of value chains needs to take into account their dynamic nature.
• By integrating value chains analysis from a development point, linkages and nodes are becoming more important in the move away from producers and it provides a framework for analysis.

Specifics of livestock chains

• They have different products from one (same) animal. Looking at the animal and not the buyer be limiting our understanding of livestock chains.
• Households often take part in different chains within the same enterprise
• Protein is replaceable therefore the livestock chain is easily replaceable
• Small ruminants could be much easier to manage in value chains. e.g. the poultry chain has a lot of opportunity, because it is easy to get into and exit from.

Livestock chains need to be analyzed on quantification and indicators, in order to capture dynamics as well as an assessment of chain governance from a policy perspective. i.e. to identify governance hot spots, e.g. role of supermarkets in the chain in some areas. And also look at independence and interdependence issues within the chain. Focus should be on the immediate, medium and long-term element of value chains.

For the Food and Agriculture Organization of the United Nations (FAO) participation and review of livestock value chains began while looking at avian influenza and how to stop the disease. Looking to understand extent of impact in different countries using trade flows and value chain flow charts. Found most of the trade in the chain was informal. Avian influenza helped researchers understand the livestock sector and political participation/will ensures the success of efforts to understand value chains.

Areas for further research

• Need for standards and sourcing in the chains.
• Not clear whether certification will lead to better markets.
• Policymaking needs needs further evidence that captures dynamics within the value chains and research needs to communicate better these findings to policy makers

Download the presentation – Value chains from a development perspective

Value chain development: Rationale, approach, tools by Andreas Springer-Heinze

Overview

• Consider the value chain as an industry (macro perspective) to differentiate it from a supply chain.
• The rationale for value chain development is modernization and the phenomenon of non-functional markets.
• Performance of value chain development: how to influence the outcome of the chain upgrading.
• Elements that can be assessed in value chain analysis include structure of the industry, type of market linkages (types of contracts terms and financing), chain governance.
• Change in value chain development is brought about by representatives of the industry collaborating with the operators of the industry to bring about change and performance.
• Research needs to understand the institutional change process, especially values chains that are working but not moving (those at low equilibrium) for various reasons including constraints.

Download the presentation – Value chain development: Rationale, approach, tools

Clarifications, questions and discussion

What is the definition of value?

• Value may be defined as the end price that the customer pays for the final product on the market.
• Value may be defined as volume transferred by the formula (volume * price).
• Using a systems approach, value chains can be interpreted as a social and economic system that serves a market. One still needs to decide what elements to include in the system so as to carry out the value chain analysis. There are no hard and fast rules on what to include and exclude.

How does value chain analysis capture complex relationships that often involve flows of feedback?

• Consider the relationships between the different actors in the chain; this may allow you to divide one group into several sub-groups.
• If the industry is very large with several actors, one can use cluster analysis to create categories of actors.
• Value chain analysis is an art; the relationships between the actors must be clearly communicated.
• Differentiation within the chain will enable an understanding of the links between actors/elements. This process may require a re-clustering, to ensure important links are not missed.
• The degree of resolution of the value chain map depends on the intended purpose; zoom in and create a sub-map for finer analysis of the value chain linkages.
• Scoping within a systems approach will enable understanding of relationships within particular chains and between products in specific chains.
• One view suggests starting with end markets in defining the value chains and how different actors interact to serve that market.

How do you evaluate value chains to capture both internal and external dynamics?

• This will be influenced by the specific research questions.
• Ensure that the value chain research question is clearly defined, consider where the value chain approach is necessary then identify what tool can be best applied.

General comments and points to consider

• Within the CGIAR context, we need both theoretical tools as well as pragmatic approaches to apply towards improving value chains. How do we standardize these for wide applicability and replication by partners?
• How do we integrate agricultural research toward supporting continuous upgrading of value chains?
• How do we get tools for actionable advice on value chain constraints?
• Sample size is a bottleneck in designing value chainresearch. If sample size is too low, then hard to develop a suitable model.
• Value chains are good at mapping but they are not yet visibly generating solutions and actionable advice. And how do you do this as part of other fields of solutions generating approaches/mechanism such as gender and development?
• There is need to link CGIAR work to existing value chains frameworks in the process of combining academic and scientific theoretical frameworks and applying it for impact (an art). This process should be standardized to enable application in wide ranging contexts and replicating.
• Emphasis should be both on tools but also understanding the process of upgrading and the additional challenge of integrating research towards continuous upgrading of the value chains.
• The value chain approach may not be applicable in every instance/situation. The right value chain questions and tools are necessary in understanding the impact of value chains.

Identification of topics to be addressed by value chain analysis

Subject	Topic to be addressed by value chain analysis	Reason why topic is targeted
Marketing economics	Governance organizations and institutions, and business development services (including transboundary issues)	Governance and institutions are key for value chain performance since they determine incentives and upgrading; actor asymmetry. Politics of resource allocation. Getting the structure of organizations “right” is a pre-requisite for value chain improvement. Need to enhance efficiency and improve value chain performance. For effective targeting of segments for value chain upgrading. Interventions are public goods (private sector is often anti-poor).
	Market power asymmetries; transaction costs (including heterogeneity of actors); risk	Networks play a role in market power. Competition leads to efficiency and continuous improvement. Transparency leads to discovery of real value. Poor producers tend to be disadvantaged in access to information. Successful innovations are needed. Actor heterogeneity complicates innovation success.
	Distributional impacts for gender and value addition	Gender aspect will be key in CRP 1.3. Need to protect marginalized groups (farmers) so they benefit as value chains are upgraded. Interventions sometimes alter the distribution of benefits in some activities so we need to assess whether our work results in more benefits for the poor. To inform decision-makers and policymakers about the nature of interventions, their importance and potential investments. Non-farm jobs for women are limited in rural areas. To ensure that poor smallholders get a “fair” share of value addition. Equal access to resources by women can increase production by 30%.
	External environment (global value chains)	Value chain performance can be significantly affected by exogenous factors (e.g. price, subsidies, policy, trade, regulations). To understand uncertainty, risk and trends in taste. Help just trends and risks. Financial capital can originate from sources, including external ones.
Social sciences	Power and pro-poor approaches: How to align interests of value chain actors around value chain upgrading objectives	Need to understand power relations, the impact of decisions of one set of actors on another and issues related to exclusion. Need to know who needs to be empowered and who sets the rules.
	Dynamic nature of value chains and markets	Need to identify leverage points, entry points and incentives within changing markets. Need to understand drivers of change; need to understand how actor incentives change as markets change.
	Monitoring and the need for feedback loops	Need to assess poverty outcomes among the actors. Need to assess the state of the value chain to understand who the beneficiaries are and their priority impact areas in the value chain. Need to understand change and power relations.
Veterinary epidemiology	Process and role of value chain analysis	Improve methodological links so that value chain analysis can work appropriately and effectively with other disciplines (e.g. gender, anthropology, political sciences). Need to develop a collaborative integration framework which is a challenge at the moment.
	Impact	Need to obtain more actionable integrated value chain inputs towards understanding how to alter pathogen flows; this will help us understand how upgraded value chains can be better at improving food safety.
	Value chain contributions to problems and solutions partially or completely outside the value chain (e.g. zoonoses; effect of autoconsumption)	Systems perspective is needed
Breeds, feeds and services	Production	Prioritization within the production component, e.g. production vs. marketing; prioritization with the production component, e.g. breed vs. feed vs. health; targeting the needs of various actors along the value chain
	Feeds	Consider the full feed/fodder value chain; understand dynamics of fodder/feed marketing, feed manufacturing, feed safety; forage production and delivery; access to seeds
	Breeds	Delivery of germplasm to smallholders in a value chain framework
	Services	Need for appropriate value chain tools to analyze delivery and financing of services (e.g. animal health and extension) along the chain not just at producer level. Consider crosscutting issues of economies of scale, such as how to generate enough supply to meet demand. Assess funding mechanisms for these services.
	Management strategies	Know-how is not an explicit input but needs to be considered
Project management	Framework for measuring value chain performance	Needed for monitoring and evaluation. We need to evaluate positive change and impact of projects; understand the project implementation process; translate research theory to action; and harness private-sector involvement. Also need to clarify the role of researchers, development partners and donors, and understand how to upscale successful processes.
	Team composition and skills	In addition to technical (disciplinary) research skills, soft skills are important for strengthening partnerships and engaging effectively with development partners
	What is the role of research in the project?	Challenge of balancing the need for, and role and scope of, hard science (qualitative research) and quick deliverables (action research)
	How to engage the private sector more meaningfully?	Need to define appropriate boundaries, scale and scope of value chain projects and determine at what point development partners take over.

Comments Social sciences group

• Value chain approaches alone is not enough to figure all these relationship and may need livelihoods approaches and participatory approaches.
• Also realize that value chains may be the ‘game of the day’ and not all issues on value addition may fit in value chain approach. The CG needs to ground theoretical rigour and reality.
• Make distinction between value chain development and other approaches/perspectives that may also make an impact. Not everything even within markets is within value chain analysis.

Veterinary and epidemiology group

• The objective of value chain upgrading should be more than just profits but needs to tick boxes of better environments etc.
• Harness the power of value chains to contribute to solutions partially located in value chains such as animal health.

General comments

• Value chain implementation (research) should use already existing projects, to learn how projects communicate lessons about value chain development
• Use also lessons from political platforms, such as those common in Francophone Africa that bring together representatives of industry to discuss issues that affect them.
• Success of value chain interventions can be measured by, among others, looking at level of people’s access to markets and growth in partnerships within the chains, including junior partnerships
• Need to find ways of connecting priority topics in value chain analysis to performance measures and ways of assessing best suited interventions for different cases.

Connecting priority topics to performance measures

	Dairy	Pork	Sheep and goats	Fish	Services and inputs
Integration topic	Distributional impacts and gender equity	Service delivery and extension to upgrade smallholder value chains	Pathogen reduction actions in the value chain (free-range sheep and goats)	Delivery of germplasm to smallholders	How to engage the private sector more meaningfully
Value chain upgrading intervention	Dairy plant providing training to women on milk quality. Quality-based payment for high quality milk paid to bank account held by women.	Pig producer groups; existing agrovet shops	Basic animal health interventions; veterinary service delivery	Boost production of tilapia through fingerling production; reduce distance for fingerling delivery by building satellite hatcheries (with help of private sector and transformation of some smallholders into large-scale hatcheries)	Organizing demand for services to attract/incentivize private-sector involvement in service provision; increase demand for artificial insemination services
How would you test whether this is a desirable intervention?	Number of women trained; women’s control of money. Government: show role of women in quality assurance, inform and create transparency, set quality standards for milk markets. Business leader of dairy industry: continue innovating quality management and payment system	Provision of better information to existing agrovet stores; randomized control trial	Reduced animal morbidity and mortality; reduced risk to human health. Intervention is desirable if it is sustainable after the life of the project	Quality of fingerlings; survival rate of fingerlings during transport to hatchery; behaviour change to access hatcheries	Private sector has an incentive to provide services. Users of services have access to a wide range of quality service providers. Service provision viability (financial). Technical quality assurance, cost structure, number of services
Why would you choose this method?	This links provision of incentives to (payment of quality) to production-side performance of the chain. Also benefits women through training and control over money	Outcomes (measures): production parameters, profit, sustainability, cost, pig health, equity, food safety measures (residues, microbial safety, cysticercosis)	Need to know what diseases exist (animal health assessment; participatory epidemiology) Tools to assess (desirable): ex ante impact assessment, cost-benefit analysis	Tests for positive influence on information flow between big companies (hatcheries) and smallholders	Pilot testing and action research to understand collective action dynamics and to examine incentives for private-sector involvement and governance. Action research allows for early implementation/uptake of intervention; it also promotes partnerships
Regarding uptake of intervention, what is the influence of the governance of the value chain?	Contractual arrangement between farmers and the dairy plant	Agrovet stores: more information to already powerful groups thus more leverage. Producer groups: changing the power structure (new relationships); empowering farmers through collective action; access credit/loans	Communal grazing areas, vaccination schemes and national animal health policies are in place but these may not reach all areas. Organization of payments to paravets	Improved information exchange and negotiation arising from joint efforts of the public sector, private sector and smallholders; public-private platform on fish to initiate upgrading; revolving fund as mechanism	Internal governance structures of producer group and private-sector service provider. Governance structures that govern the transactions between producers and private-sector service providers and that influence the policy environment in which these groups operate. Need to focus on the relationship between the private sector and farmers: “Why should producers participate and who pays?”
Identify what you would measure as value chain performance and why	Milk quality; market share of types of milk; benefit to women from different systems of payment	Equity, volume of production; farmers’ entry into new markets (e.g. supermarkets)	Willingness to pay for paravet services; number of farmers engaged and proportion of animals treated; reduced mortality; better prices for healthier animals; some modelling (pre and post).	Behaviour change; socio-economic impact at smallholder level; quality of fingerlings; development of better institutional arrangements or contracts; new entrants into the value chain (growth of the chain); community development	Process indicators, e.g. reduced response time for service delivery (increased efficiency); increased income of farmers and service providers; increased demand for services; reduced transaction costs

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DAY TWO: FRIDAY 18 NOVEMBER 2011

Review of day one – Derek Baker

• Definition and context of value chain analysis
• Gaps identified in value chain analysis with regard to low sample size and quantitative analysis
• There is need for actionable solutions; managerial strategies and systems thinking should be included in value chain analysis.
• Review of categories and types of performance indicators identified from a review of literature [vide handout on performance indicators, adapted from Trienekens et al. (2008), British Food Journal 110(1): 98-127)]. Four categories of indicators were identified, namely, efficiency, responsiveness, quality and flexibility. Eight types of indicators were identified, namely, production cost; profitability; time; process planning; product attributes; collaboration; environment; and market adaptability.
• Review of practices and performance in different types of value chain upgrading (process, product and functional upgrading), from Kaplinsky and Morris (2008). Governance upgrading was noted as a useful addition.
• There is need for systematic identification of upgrading options, the actors involved and the kind of interventions they can make.
• Capital is important in upgrading the function of value chains.
• Learning platforms are needed for the CRPs to know how to mobilize our partners.
• Governance systems are both internal and external to value chains.
• The lack of value chain analysis data was highlighted. There is need for attention to how to mobilize analytical frameworks for value chain analysis.
• Discussion on performance measures was not very detailed. There is need for more attention to performance measures, what is to be measured and how it will be categorized. Most of the performance measures are project-related. There is need for measures that can improve and deliver something from the value chain.
• The group work achieved cross-disciplinary learning and technical progress, and raised important points on simultaneity and causality of value chain upgrading but neglected the end markets due to the use of frameworks that were too similar. The process also identified some performance measures for interventions, some of which define the limits of value chain analysis application. Data supply was loosely defined but was to be addressed during the second day of the workshop.

Comments and questions

Definition and concept of governance There was a call for a more simplified definition of governance. Various definitions and descriptions of governance were discussed:

• Governance refers to transactions and the set of rules related to those transactions, for example, price, price determination, and contracts between buyer and seller.
• There are different governance systems (formal and informal) that are closely linked to institutions, which are part of governance.
• Governance in value chains can include issues like property rights.
• The trilogy of markets, networks and hierarchy is often used to describe governance systems. There is need to make a distinction between markets and the parties involved that may influence or dominate value chain relationships
• Issues of governance are related to who actually coordinates specific parts of the chain. Different governance structures may exist within a value chain.
• Governance is related to government and issues of resource allocation; includes informal and formal rules (institutions).

Adapting value chain analysis to smallholder agriculture There is need to adapt the theoretical, text-book value chain analysis approach to the context of smallholder agriculture; this is a key challenge.

Tools for value chain analysis

• There already exists a set of established generic tools; which tools are used depends on the specific value chain research questions or which aspect of the chain one is examining (e.g. governance).
• Specific tools can be developed to address specific gaps once these gaps are identified, especially within the context of value chain research in the CRPs.

Generalization in value chain analysis

• To what extent can we have a generalized theory of change in value chain analysis? This will help define the contested tools within the value chain. We need this as soon as possible; we cannot wait for two years.
• Response: Achieving a unified approach to value chain analysis may be a long-term process because there still are not enough data and information available to make these generalizations and lessons are not yet at the level of ‘best practice’. There are too many huge differences between value chains in different sectors. Niche products like honey are more pro-poor but are limited compared to maize value chains, for example. There is need to classify the sectors and compare the analysis.But even in specific value chains, there are challenges in identifying methods that are pro-poor; this is where the challenge lies.
• Value chain mapping is a flexible and usable tool that can be applied. When identifying tools, one should consider what strategy to use, what to analyze and what conclusions are to be made. Regarding the generic tools available, these would have to be applied differently depending on the context.
• If gaps exist, there should be agreement within the CGIAR context on how to go about doing value chain analysis work.

Presentation: experience on value chain analysis

ILRI experience with partners: Derek Baker Where value chain analysis has been applied in the past and the tools that have been used (e.g. rapid appraisal, action research)

• Food safety: knowledge, attitudes and practice (KAP) surveys, willingness to pay
• Self-reporting of data

Why value chain analysis for animal disease analysis?

• Study on economic impacts of the 2007 Rift Valley fever outbreak in Kenya used two value chain analysis methodologies: rapid appraisal and social accounting matrix.
• Avian influenza study in Nigeria: Expert consultation through workshops was used to develop the structure of the chain, followed by key informant interviews and focus group discussions. This involved mapping out key questions for the different categories of actors. Pre-populated flow charts can be useful tools to help in the interviews, e.g. with traders. Expert opinion was used to pre-populate the flow chart, which was then validated based on data collected from the field.

Value chain analysis for market access

• Value chain analysis can provide evidence on where to intervene to improve competitiveness of value chains. However, there are gaps in availability of quantitative tools to provide evidence to policymakers on where to intervene.
• Process modelling was used for value chain analysis of market access for beef in Ethiopia.

Question: Can network analysis be used to generate hypotheses on chain performance? Yes, it is possible to generate several hypotheses but more empirical measures are needed. Characterise each interaction and the relationships between them.

Download the presentation – Value chain analysis: Tasks, tools and tales

Identifying value chain tools: exercise

The objective of this exercise was to identify and map the tools and performance measures needed to carry out value chain analysis. Four specific steps along the value chain process were considered: rapid appraisal, case studies, piloting a value chain or intervention in the value chain, and scaling up. Three categories of tools were considered:

• Category 1: Tools that exist and that we have
• Category 2: Tools that exist but we do not have
• Category 3: Tools we are not sure exist but we need

Participants divided into five random groups and each group picked two topics identified during the previous day’s group work (one group had three topics). The topics represented the development context and the motivation for value chain research. Cards representing the four nodes of the value chain process had been pasted on the floor.

For each topic, participants wrote down the tools and associated performance measures on tool-shaped cards and pasted these on the floor along the respective nodes of the value chain process diagram. Below are the topics chosen by each of the groups.

Topic	Group 1	Group 2	Group 3	Group 4	Group 5
1	How do actors’ incentives change as markets change?	Market power asymmetries	Framework for measuring value chain performance for monitoring and evaluation purposes	Prioritisation along the value chain	How to align interests of value chain actors around value chain upgrading objectives
2	Considering the full feed/fodder value chain	Value chain contributions to problems and solutions that lie outside the value chain (a systems perspective)	Methodological links of value chain analysis to veterinary epidemiology, gender, anthropology, political economy etc.	Governance and institutions	Defining appropriate scale and boundaries for a value chain project
3	--	--	The external environment	--	--

Discussion of the value chain tool identification exercise (by topic)

How do actors’ incentives change as markets change? At the pre-rapid appraisal stage, historical analysis and individual actor case studies are tools that exist and are available and that can be used to measure changes in actors’ incentives as markets change. However, gaps were observed with regard to conceptualization/typology of incentives; we need tools to categorize, measure and assess incentives. We do not have a systems dynamic tool for case studies and scenarios, though the tool exists. At the rapid appraisal stage, KAP surveys and trend analysis are useful tools that exist and are available for measuring changes in incentives and behaviour.

Considering the full feed/fodder value chain At the rapid appraisal stage, we have various tools at our disposal, including, stakeholder analysis, expert consultation, network analysis, mapping and a feed assessment tool. These would be used for a general overview to identify case studies and interventions for piloting.

For case studies, we already have various tools such as GIS mapping, chain actor surveys, stakeholder workshops and focus group discussions (to identify case study and pilot sites for interventions), feed assessment tool, network analysis and KAP surveys. Performance measures include feed quality, productivity, value of animals, farmer incomes, access to feeds, availability and cost of feeds, distribution of benefits, and efficacy of feed delivery system.

Gaps were identified at the case study stage with respect to lack of tools for assessing cost-benefit analysis (category 3). A participatory cost-benefit analysis tool would be useful to assess potential feed technologies. Also, a “technology fit” tool would help to determine appropriateness of different technologies.

Partners’ roles increase as one moves up the chain towards piloting and scaling up with development NGOs playing key roles. Available tools include institutional capacity building for standards, and GIS to identify domains for scaling up and recommendation domains/modelling scenarios. However, there is a gap with respect to lack of guidelines to plan for scaling up and out.

Market power asymmetries At the rapid appraisal stage, existing tools that we have are actor analysis and market structure analysis. The performance measures for both these tools include concentration ratios. For market structure analysis, performance measures include market share; market trends; structure, conduct and performance of the chain.

Between rapid appraisal and case study, we need a tool for identifying leverage points among actors in the chain (category 2). The performance measure for this tool would be the ability to map the constraints and opportunities of value chain actors.

At the case study stage, price formation analysis (category 2) would assist in understanding how decision-making occurs. The performance measure would be the ability to characterize decision-making processes.

At the pilot stage, partnership development tools (category 2) would help understand the strength of cooperative relationships (social networks) such as public-private partnerships and market chain partnerships

Between piloting and scaling up, gaps were identified in that while we have qualitative tools there are not many robust, quantitative tools available to evaluate market power asymmetries. We need to ensure we have a rigorous evaluation baseline. In general, we should be aware of the limitations of the tools so as to apply appropriate strategies.

Value chain contributions to problems and solutions that lie outside the value chain We can learn from interventions and tools and introduce them into the value chain (import lessons learned); extension services could play the role of linking partner in this regards. Outcome mapping (category 1) can be applied in conjunction with communication and advocacy. The performance measure would be non-value chain actors replicating value chain interventions and strategies. This would be useful for CRP 2 [on policies, institutions and markets]. The challenge is how best to map out key partners: Who are they? At what scales do they operate (national or regional)? Which partners do we target?

Framework for measuring value chain performance for monitoring and evaluation purposes Between piloting and scaling up, a price monitor (category 1) can be used to measure value chain performance; the performance measure would be higher product prices. Productivity measures (category 1) can be used at the pilot stage; the performance measure would be higher productivity (more output per unit input). Tools for monitoring market channels (category 1) would be useful at the pilot stage. The performance measure for this tool would be increased market share in some market channels by poor producers. At the scaling up stage, a gap was observed in the use of outcome mapping to employ theory of change (category 3), with behaviour change and uptake as the performance measures.

Methodological links of value chain analysis to veterinary epidemiology, gender, anthropology, political economy etc. At the rapid appraisal stage, best practice for governance was identified as a performance measure that does not exist, although tools for it exist, for example, KAP surveys, serological tests, participatory rapid appraisal and participatory disease surveillance.

For case studies, we can use GIS to help understand geological clustering or flows of product and service flows vis-à-vis pathogen flows. Measurement of disease burden is another tool that is available for use during case studies; the performance measure would be improvement in disability adjusted life years (DALYs). At the pilot stage, we can use risk analysis in value chain analysis with food safety risk assessment as the performance measure. At scaling up, we need a decision support tool for prioritizing interventions.

The external environment External environment was interpreted as “an enabling environment for the value chain”. Key informant interviews are among existing tools for rapid appraisal, but we need an inventory of value chain-enabling indicators (similar to World Bank indicators).

Prioritization along the value chain At the case study stage, we have various tools that can be used, such as sectoral modelling (to measure the competitiveness of the value chain); value chain mapping, GIS characterisation (to understand geological clustering or flows of products and pathogens), CG SAM modelling (for decomposition of benefits/losses distribution); and quality functioning deployment ( for defining quality demands for the market for scaling up the value chain). During piloting, risk analysis is available for food safety risk assessment. However, we need a tool for multi-criteria welfare measures to measure social welfare covering incomes, food safety, disease and the environment. However, a gap exists at this stage with respect to system dynamic modelling (e.g. VAIMS); this tool needs to be developed as a standard for scenario modelling. Its performance measures are change in value added and profit by node, and change in flows, volumes, revenues or profits by node. During scaling up, we need tools (e.g. EXTRAPOLATE) to facilitate discussion and assessment of stakeholder priorities. The performance measures are: distribution of potential benefits of addressing priority constraints, and policy change.

Governance and institutions At the rapid appraisal stage, there is a gap in available tools for analysis of policy and governance on value chain behaviour based on New Information Economics principles. The performance measures are compliance with standards (e.g. sanitary and phytosanitary standards) and typologies of contracts and implications. For case studies, transaction cost analysis exists but is not available in a form that is adapted to our value chains; this tool would be useful for understanding governance. The performance measure would be reduced cost and increased volume/value at each link in the value chain. At scaling up, we do not have, but need, social accountability tools for social audits and community score cards.

How to align interests of value chain actors around value chain upgrading objectives At the rapid appraisal stage, focus group discussions (category 1) can be used to gain a better understanding of various actors’ interests and incentives. Economic assessment (ex ante) of actors’ performance can be done during rapid appraisal and case studies; performance measures would be producers’ profit margins and market agents’ margins and profits. From pilot stage onwards, outcome mapping (category 1) can be used to measure change in behaviours, mind sets, and attitudes. The performance measures would be joint action and activities.

Defining appropriate scale and boundaries for a value chain project Before carrying out a rapid appraisal, a useful tool would be one that can define or draw the boundaries and the actors from the start of the project; this was identified as a gap (category 3). At the rapid appraisal stage, value chain analysis can be complemented by sectoral analysis. The performance measure here would be the relative competitiveness of local producers vis-à-vis international productivity benchmarks.

Closing comments on the tool identification exercise Two notable areas where gaps exist are in using employment as a performance measure; this would be very powerful for advocacy for interventions aimed at value chain upgrading. In addition, with respect to improvement in product quality especially in the informal sector where standards may not exist, or where it is difficult to apply specific metrics. We need to acknowledge that not all these tools are going to be used by everyone and that in addition to tools, the issue of governance is important.

List of value chain tools identified, by category

Tools exist and we have them	Tools exist but we don’t have them	Not sure the tools exist but we need them
Historical analysis and individual actor case studies Stakeholder analysis Expert consultation Network analysis Mapping Feed assessment tool Knowledge, attitudes and practice survey Focus group discussions Participatory Disease Surveillance Serological tests GIS characterization of production/market systems Value chain mapping Actor analysis Market structure analysis Risk assessment (epidemiology) Measurement of disease burden CGE-SAM modelling decomposition of benefits/losses distribution Surveys among all chain actors Stakeholder workshops Feed assessment tool Network analysis Outcome mapping Monitoring market channels Productivity measures Risk analysis Action research Innovation platform hub Quality control tools for feed Monitoring and evaluation tools Seasonal calendar Price mapping Price monitor GIS to identify domains for scaling up and recommendation domains/modelling scenarios	Cases studies system dynamics and scenarios Value chain mapping Key informant interviews equivalent/analogous to World Bank indicators Quality functioning deployment Transaction cost analysis adapted to our value chains Calculation of transaction costs Combined epidemiology livelihood disease burden along the value chain Identifying leverage points/incentives “Political economy” tool to understand conflict of interest/vested interests/power relations Price formation analysis Technology fit tool to determine appropriateness of potential technologies Multi-criteria welfare measures Partnership development e.g. public-private partnerships, value chain development Calculation of value added (social and economic) EXTRAPOLATE (stakeholder assessment priorities) Social accountability tools	Conceptualization/typology of incentives Tools to measure and assess incentives Tool to define/draw the boundaries [of a value chain project] from the start Inventory of value chain-enabling development indicators Participatory cost-benefit analysis tool to assess potential feed technologies System dynamic model (VAIMS) Whole chain performance Quality check tool Evaluation tools (for pilot and scaling up) Robust qualitative methods Using outcome mapping to employ theory of change Decision support tool for prioritizing interventions Guidelines to plan for scaling up and out

Group discussions on CRP3.7 work plans

To discuss CRP 3.7 work plans, participants split into four CRP groups representing the following value chains: dairy, small ruminants, pigs, and fish. The discussions centred on the following topics:

• tools development;
• stakeholder engagement;
• review of past successes;
• rapid assessment; and
• proposal writing.

Reporting back on discussions on CRP3.7 work plans: Summary

1. Dairy: There is a general alignment of activities with the work plan.
2. Pigs: There is need for more attention to rapid assessment and feed ratios; we need to identify where the risk exists in the value chain as well as consider farmers’ competitiveness.
3. Small ruminants: The general application of tools aligns well. Innovation platforms need to be established and made operationally useful. There is need to develop platforms for stakeholder engagement. Tools for site selection exist (i.e. GIS) but need to consider whether to include criteria for market access in site selection. Rapid assessment tools exist for baseline surveys.
4. Fish: Rapid assessments have been done in Uganda. Aquaculture projects in Egypt have not used the value chain approach much.

Reporting back on discussions on CRP2 Outputs and how they may be delivered

• Rapid appraisal of consumer markets: characterization of demand for technologies
• Modelling: sector analysis

Next steps

1. Value chain tools available on a wiki page
2. Design CRP2
3. Come up with a map of skill set and translate this into training
4. Translate all workshop outputs into a joint working paper (CRP3.7 and CRP2)
5. Critical review of tools available and their application
6. Identify set of tools to be used