With the support of the Gates Foundation, Acumen commissioned a study with Bain & Co. to understand key drivers of the adoption of agricultural innovation among smallholder farmers. Vikki Tam is the lead partner on the project. Below Vikki writes about her recent field visits in India and Kenya. This post was originally posted here.
Upon my return from the various field visits I have been making to India and Kenya as part of our current project for Acumen, I was frequently confronted with the question “What was it like? Was it what you expected?” More often than not, that simple question rendered me momentarily speechless or prompted an anemic response that made me sound, at least in my own mind, rather superficial.
The truth is, it is not so easy to distill what we experienced into digestible sound bites.
I have spent the last few weeks with my team (Chris, a manager from London, and a team of four from Mumbai – Aniruddh, Jordan, Balaji and Urmil) visiting villages and interviewing farmers in southeast India and northwest Kenya. The purpose of these visits was to better understand how farmers adopt innovation (hybrid seeds, micro-drip irrigation, asset backed financing, market aggregators and value-chain integrators for specific crops…), and what entrepreneurs and other actors in the agriculture ecosystem can do to accelerate this adoption process. The findings and recommendations from our project will be published in a whitepaper we are coauthoring with Acumen, with funding provided by the Gates Foundation. It is exciting to be extending our partnership with Acumen this way after the last two years of working together on strategy and organization issues.
This topic is important and demands study because the adoption of new products and services can help smallholder farmers increase productivity, which in turn improves their livelihoods and reduces poverty. Over 90% of the population in India and Kenya live on <$4 a day (PPP), of which ~80% live in rural areas. Considering that agriculture is the dominant livelihood and smallholders own ~80% of the farms, addressing this problem of adoption is critical to addressing the (still largely) intractable problem of global poverty.
Ah, poverty. If ever there was a term as fraught with preconceived notions. After our visits to a few villages near Aurangabad in Maharashtra, where we saw fairly well tended fields of cotton, millet and pomegranate, and where most of the farmers we met carried a mobile phone – one of my younger team members commented, “They didn’t seem so poor.”
I wonder, would it have been less perplexing to my team member had the farmers all looked thinner, dirtier and their clothes more ragged? Indeed, we were not talking to the “poorest of the poor” (those living on less than $1.5/day); and perhaps the fact that one of the villagers served poha (a sort of broken rice cooked with chilies) to our entire “delegation” was a bit dissonant with common built-in notions of what poverty should look like. But one doesn’t even need to resort to the trite rumination of how the way these farmers live provides a sense of perspective, to appreciate that these are people living in poverty. These farmers live in small mud houses with dirt floors, the rooms are dark because the single light bulb (if there is one) only goes on for an erratic two hours a day; they cook over dry twigs, there is no sanitation to speak of, and little girls throw filthy-looking jerry cans down a 30-feet well, more or less dry, to gather almost equally filthy water. In Bungoma Kenya, the farmers smiled sheepishly, or laughed – whether from embarrassment or from bemusement at our questions, it’s hard to say – when asked what kind of flooring they had (mostly dirt, smeared with cow dung), what lighting fuel they used (mostly paraffin), whether they owned any irons (mostly no) or towels (under 2, for a typical household of eight….), and other similar questions per the Progress out of Poverty Index. So, let’s be clear, they are poor.
But acknowledging that does not necessarily bring one closer to understanding them, at least not from the limited time we had talking with each farmer. There was Alice, the retired nurse who has returned to her village, showing off her English and the fact that her kids are in college; the 68 year old Joinna who cast her eyes down when speaking of the 1.5 acres she was left with when her husband died and how the original 7 acres were distributed to her sons; the 28 year old Sara who has been leasing land and now dreamed of owning her own half-acre; and Eliud, the 45 year old in a suit jacket who insisted on being “empowered” before he would take on a loan to buy maize seeds and fertilizers. Even within this small group of farmers who live a few kilometers of each other, there is the same richness in personality, motivations, aspirations and social sensibilities that exist elsewhere.
There are a couple of things that have become clear to me.
Even the “poor” can and deserve to be treated as customers, not beneficiaries. When asked about why they adopted specific products and services, the farmers sounded like, well, us. There are things they like and things they don’t. They are highly price sensitive (or more precisely, cash flow), but brand matters. They tell friends and neighbors if they like a product or service, and they want better products and services as their livelihoods improve.
The entrepreneurs who are serving these farmers are making a difference. They are the source of innovation, creating products and services to meet the needs of these smallholder farmers, filling a gap where governments have failed and markets don’t yet exist. Farmers’ lives have improved as a result of what these pioneer firms do. Rather than relying on the monsoon, farmers in parched areas of Maharashtra and Karnataka are able to conserve water and increase their yields by 50% (among those interviewed) as a result of using micro-drip irrigation developed by Global Easy Water Products. In northwest Kenya, over 15,000 farmers in the last two years have brought in extra monthly income (average $100-$120 among farmers interviewed) after taking out an asset-backed loan from Juhudi Kilimo to buy a cow, which allows them to sell milk in the market. But these pioneer firms are doing more – by treating these farmers as customers, they are giving them a sense of control, choice, and ultimately, dignity that transcends the value of the products and services themselves.
What these entrepreneurs possess is not only a great idea and the gumption to build new business models to target a market segment that is notoriously hard to serve, but also deep sensitivity and care for the problems they are trying to solve. But this sense of mission does not immunize them from the usual travails of business – low-cost copycat competitors, over-extension, costly complexity, scarcity of talent… (One of my favorite moments was when Paul, a Business Development Officer at Juhudi Kilimo, started the day leading a group prayer for his colleagues, where he asked God to “help sustain our competitive advantage and transform farmers’ lives”). I am genuinely excited by the potential of our Bain toolkits – in repeatable models, customer advocacy, adjacency expansion, commercial excellence…just to name a few – to help these social enterprises achieve true scale, impact and sustainability. I am hopeful of how these entrepreneurs could galvanize other market innovations, and perhaps even encourage more corporates to take a serious look at this market segment, both as consumers and as producers. At the risk of sounding somewhat patronizing, my encounters with the local talent at these companies left me profoundly hopeful and optimistic about the future of these countries.
Perhaps after these trips, I am no closer to understanding the individuals we met, and the answer to the challenge of how to truly scale social innovation to tackle global poverty remains elusive. But as I think back to the moments when we savored the delicious poha, when an Indian farmer in Pirpimpalgaon handed me a handful of peanuts and an invitation to attend her daughter’s upcoming wedding, or when one of the Bungoma farmers shoved bunches of bananas in our hands as we left, there’s the sense that one caught a glimpse of our shared humanity. And perhaps, that will be sufficient for now.
This post appeared first on Acumen and was called Reflections from the field: Visiting smallholder farmers in India and Kenya.