The role of the farm management specialist in extension

Farm management extension guide

The role of the

FARM MANAGEMENT SPECIALIST

in extension

David Kahan

FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS

Rome 2013

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E-ISBN 978-92-5-107552-4 (PDF)

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iii

Preface

Farm management extension is concerned with the

development of management strategies and skills

among farmers for improved decision-making in the use

of resources and linking farmers to markets. With the

increasing market-orientation of farming, the decisions

taken by farmers are more complex; for farms to compete

they must be run as a business. This creates a demand for

specialized extension support. To be successful farmers

need the skills to produce what the market wants and

what satises consumers. The growing importance of

specialization in farm management is to support farmers

in this work.

Those providing farm management extension

go by many names: Farm Management Specialist or

Agribusiness Management Specialist; Agro-enterprise

Promoter; Agribusiness Counsellor – to name a few.

In this guide the title used is Farm Management

Specialist (FMS) and whichever title is used, refers to

the specialization of providing support in business and

marketing in the context of farming.

This guide provides a wealth of information

suitable for use by those concerned with the promotion

of farming as a business – whether they work for the

private, NGO, or public sector. These could include public

sector extension workers involved in farm business

management and marketing, private sector business

service providers and NGO’s. Finally, it is hoped that

this guide will encourage decision-makers to establish

farm management extension positions where they do not

exist.

Contents

Preface ..................................................................... iii

Acknowledgements ................................................... vi

INTRODUCTION ...................................................... 1

Chapter 1

FARM MANAGEMENT EXTENSION ...................... 5

Chapter 2

DIAGNOSIS AND INVESTIGATION ........................ 17

Chapter 3

PLANNING AND PROJECT APPRAISAL ............... 43

Chapter 4

LINKING FARMERS TO MARKETS ........................ 63

Chapter 5

TRAINING AND EXTENSION .................................. 85

Chapter 6

COMMUNICATING INFORMATION ........................111

Further reading ....................................................... 127

Acknowledgements

The author would like to acknowledge the assistance of

colleagues and friends. Thanks are due to Doyle Baker

and Steve Worth for their review of the guide, Tom

Laughlin, who managed the production process, Sandra

Holt for design of the photo pages, and Michael Breece,

for overall book design, layout and Desktop publishing.

David Kahan

INTRODUCTION

There is increasing interest in farm management as

a specialization in extension and a need to develop

farm business management skills among extension

workers and farmers. This guide contributes to

the development of these skills and specically

addresses the work of those who are involved with

providing farm management support at all levels of

extension.

The role of the farm

management specialist

is broad and diverse

INTRODUCTION

The role of the farm management specialist covers

investigation, planning, marketing, training and extension,

as well as other related functions.

Farm management specialists may be situated at

various levels within an extension service. They may be

found at central or headquarters level, close to decision-

makers. They may be found at decentralized levels such

as provincial, regional, district or township levels. Or they

may be found in any combination of these.

While the level of experience of specialist extension

workers can vary markedly between countries and areas

within countries, the tasks of farm management specialists

themselves are very much the same. Differences might

exist in their formal job descriptions and the actual skills

and competencies of individual specialists but their

purpose is essentially the same – fostering excellence in

farm management among farmers.

This guide provides a basis for understanding

the breadth of responsibilities that need to be covered

in this emerging discipline. The material provided will

assist this specialized staff in day-to-day extension work

while raising awareness among extension programme

managers of this increasingly important function. It can

also be used as reference material for designing training

programmes for extension staff who may need to improve

their skills in order to deliver better farm management

support.

* * *

2 The role of the farm management specialist in extension

Introduction 3

Figure 1

The central role

of the farm management specialist

The

farm management specialist

PLANNER RESEARCHER

PRIVATE SECTOR POLICY MAKER

FARMER

FRONT-LINE

EXTENSION WORKERS

The farm management specialist plays

a pivotal role in the extension system as

analyst, planner, trainer and facilitator. These

tasks include communicating the ndings of

farm economic analyses to policy makers

and front-line extension workers; facilitating

linkages with private sector input dealers and

buyers, and supporting workers and farmers

with specialized training on farming as a

business.

Chapter 1

Farm management extension

This chapter begins with an overview of farm

management extension and the contributions that

farm management specialists can make in the

context of smallholder farmers. Farm management

specialists require a background in economics or

business or both and their responsibilities include

collecting, analyzing and disseminating information

on economic aspects of the farm to farmers, extension

workers and policy-makers. Reference is made to

the administrative structure of the extension service

and where specialists can be best utilized. Finally,

the demand for and supply of farm management

extension services is discussed.

There has been an

upsurge of interest

in farm management

particularly among

smallholder farmers

Farm management

extension services

provide farmers

with business and

marketing knowledge

and skills

and assist them

in making their farms

more protable

and competitive

6 The role of the farm management specialist in extension

THE IMPORTANCE OF FARM MANAGEMENT

Farm management extension services provide business

and marketing knowledge and skills to farmers to

assist them in making their farms more protable and

competitive. Currently, only a small number of farmers

benefit directly from farm business management

advice. These farmers tend to be more profit-minded

and market-oriented and are capable of managing

production and marketing systematically. Recently,

however, there has been an upsurge of interest in

farm management particularly among smallholder

farmers that are becoming market-oriented, and

realize the need to increase profits and become more

competitive. Potential market-oriented farmers also

have to be guided and supported in their first steps

toward commercialization.

In response to the many changes that are

impacting on farming, extension services are recognizing

the importance of business, management and marketing

support to farmers. In many countries public sector

extension services are being realigned to include

farm business management and new positions are

being established in the public service. Farm business

management advice is also being provided by NGOs

and private organizations. In developing countries,

Agri-clinics, Agribusiness Service Centres and Local

Economic Development Authorities have also been

established to provide business support services. There

is now a wide range of public and private organizations

that have an interest in improving the efciency of the

farm business. These include extension services, input

dealers and manufacturers, traders, nancial and farmer

organizations, and NGOs.

Farm management

advice includes

management,

marketing and

market access

Farm management

support must extend

beyond the farm to

all the stakeholders

in the value chain

Farm management extension

FARM MANAGEMENT ADVICE

Most farmers believe that their major problems relate to:

• Management. Small-scale farmers may be good

at producing, but often lack the skills needed to

manage their farm as a business. Extension and

training support are needed to assist farmers to

develop their management skills and competencies.

• Marketing. Farmers selling their farm products at

favourable prices which are often undifferentiated

and where competition is high. Small-scale farmers

in particular are at a disadvantage. They are less

able to sell their produce in urban areas which are

rapidly growing. A large part of the answer rests

in building marketing skills.

• Access to nance. This prevents farmers from

expanding the size of their business and exploiting

business opportunities. While many farmers

think that their main or even their only problem

is a shortage of capital this is often not the case.

Often the problem is the management of the

capital resources that they have. Again a large

part of the answer rests in training: building nancial

management skills.

Although the farmer is a key role-player, there are other

stakeholders involved in rural and urban areas that also

require farm management information and advice: input

suppliers, traders, farmer associations, processors, other

service providers and policy-makers. These people often

represent the different stakeholders in produce value

chains, linking production to nal consumption. Each of

these different stakeholders has a different demand for

business management and marketing support. Thus,

farm management support must extend beyond the

farm.

The essence of a value chain is market-focused

collaboration with different business enterprises working

together to produce and market products and services in

an effective and efcient manner.

In order to be able to build value chains, extension

services need to develop farm management skills.

Training extension practitioners in farm management and

the establishment of specialist positions in farm business

management will contribute substantially to strengthening

the agricultural sector to respond successfully to the

rapid changes taking place.

The role of the farm management specialist in extension

The value chain

The ‘value chain’ describes the system of products, organizations,

processes and transactions involved in transforming raw materials

into products that are sold and consumed. These include the

direct functions of primary production, collection, processing,

wholesaling and retailing, as well as support functions, such as

input supply, nancial services, transport, packaging, advertising

and the provision of advisory services. The value chain reects

an understanding that value is added at each point in the chain.

• Input supply

• Financial services

• Transport

• Packaging

• Promoting

• Advisory Services

Figure 2

The value

chain

Direct

functions

Indirect

functions

• Retailing

• Wholesaling

• Processing

• Collection

• Production

Specialization in

farm management

and marketing are

vital in today’s ever

changing agricultural

environment

Farm management extension

THE SPECIALIST IN FARM MANAGEMENT

Extension workers typically consist of subject matter

specialists and front-line extension workers. Subject

matter specialists are responsible for giving technical

support to front-line extension workers who are in

day-to-day contact with farmers. The subject matter

specialists are experts in specic areas of agriculture

that typically include crop production, animal husbandry,

farm mechanization, livestock husbandry, among others.

The front-line extension workers have a more general

agricultural orientation.

Farm management and agricultural marketing

are also among the specializations much needed in

today’s changing agricultural environment. And in this

environment, the management specialist has many roles

to cover and has the potential to:

• Inuence policy decisions;

• provide extension support to farmers;

• facilitate linkages between farmers, input suppliers

and markets;

• guide farmers in the best use of their resources

through investigation and diagnosis of problems

identied by them through extension support;

• compile and analyze data on farm enterprise

protability and generate extension information to

disseminate to farmers;

• advise on opportunities;

• provide up-to-date marketing and business

management information;

• help with marketing problems (facilitate linkages

between farmers and buyers);

• advise farmers on aspects of business management;

• advise on supportive public projects and programmes;

• facilitate communications between farmers and the public

sector for improved understanding and collaboration.

10 The role of the farm management specialist in extension

Specialists need to possess a wide range of

specialized knowledge in addition to the traditional

knowledge and skills in applying farm management

methods, tools and techniques. This specialized knowledge

includes nance, accounting, project appraisal, law and

contracts. They also need to be able to organize farmers

into groups, associations and cooperatives. Knowledge of

contracting is also needed to facilitate market linkages.

The farm management specialist has ve major

roles to play in supporting farmers to adapt to market-

oriented farming and to take advantage of opportunities to

improve protability. He or she is a source of knowledge and

information, a facilitator of market-linkages, an extension

worker, a facilitator of innovation and a farmer organizer.

SOURCE OF KNOWLEDGE AND INFORMATION

Provide information enabling farmers to make informed decisions.

Communicate information to front-line extension workers.

FACILITATOR OF MARKET-LINKAGES

Know the agents and the opportunities.

Gather and disseminate market information.

Bring farmers and commercial agents together.

Assist with the formulation of fair contracts.

Farm

management

specialist

SOURCE OF KNOWLEDGE

AND INFORMATION

FARMER ORGANIZER

FACILITATOR

OF MARKET-LINKAGES

FACILITATOR

OF INNOVATION

EXTENSION WORKER

Figure 3

Main roles

of the FMS

Farm management extension 11

Knowledge requirements

In order to fulll their roles appropriately, the specialist

requires a variety of those specic qualities relevant to

the dissemination of knowledge and skills.

EXTENSION WORKER

Identify and respond to problems

and opportunities enabling farmers to expand

their options and increase their protability.

FACILITATOR OF INNOVATION

Support farmers and engage with researchers

and other stakeholders to foster innovation along the value chains.

Facilitate interaction among value chain and other stakeholders

to collaborate on developing innovative responses

to problems and opportunities.

FARMER ORGANIZER

Help farmers form their own organizations in order to achieve economies

of scale, create efciencies in buying inputs and marketing produce.

Mobilize farmers to work together to tackle problems

and seize opportunities by themselves.

Farm

management

specialist

Figure 4

Required

knowledge

and skills

TECHNICAL

KNOWLEDGE

MANAGEMENT

AND PLANNING

EDUCATION

POLICY

ANALYTICAL AND

DIAGNOSTIC SKILLS

INVESTIGATION

12 The role of the farm management specialist in extension

TECHNICAL KNOWLEDGE

Farm management specialists must be adequately trained in the

technical aspects of the work and have a good working knowledge

of the main elements of the agricultural system in which he or

she is working such as crop or livestock production, vegetable

production or mixed farming.

ANALYTICAL AND DIAGNOSTIC SKILLS

Specialists must be able to examine situations, recognize and

understand the problems and opportunities and propose courses

of action. For example, if a farmer is experiencing low income

or low protability, the specialist should be able to diagnose the

situation, identify the cause of the problem and to recommend

corrective action.

INVESTIGATION

Specialists should know where to search for information, how to

interpret it and how to convey it in the most adequate and effective

form. If a farmer asks for help with determining the protability of

selling in a new market, the specialist should be able to locate

information about that market and put it together in a way that will

be useful to the farmer.

MANAGEMENT AND PLANNING

Specialists require skills in aspects of management, nance and

marketing.

For example farm management specialists can:

• assess the nancial position of farm businesses;

• assist with cash ow budgeting

and nancial planning;

• negotiate with and mediate between banks

and nancial institutions;

• assist with decision-making, including farm planning;

• provide information on government assistance schemes

and help with applications.

Farm management extension 13

POLICY

Specialists should be familiar with government legislation and

other institutional policies which affect farmers and their role in

agriculture and rural development. For example, there may be

restrictions on the movement of agricultural products or the use

of pesticides and herbicides or on labour law and tax legislation.

EDUCATION

Since extension is an educational process, the specialist in

farm management must be familiar with the main approaches

to adult education and group dynamics, and with the techniques

of facilitating farmer participation. There are often specialized

education and training programmes – including literacy and

numeracy training – for adults who have had little formal education.

Qualities needed in a farm management specialist

The skills and qualities required by an affective farm

management specialist are diagrammed and outlined

below.

Farm

management

specialist

PROFESSIONAL

COMPETENCE

TEACHING ABILITY,

UNDERSTANDING

TRUSTWORTHINESS

INITIATIVE

DISCRETION, TACT,

CONFIDENCE

SENSE OF

RESPONSIBILITY

TEAM SPIRIT

ORGANIZATIONAL

ABILITY

COMMUNICATION

Figure 5

Specialist’s

skills and

qualities

PROFESSIONAL COMPETENCE

Sound grasp of farming techniques and training

in economics and specialization in farm business management.

Understand concepts, tools and techniques of farm management.

Skills necessary to provide practical and useful

advice to farmers and to explore alternatives.

TRUSTWORTHINESS

Ethical and reliable in all dealings with farmers.

DISCRETION, TACT AND CONFIDENCE

Respect the privacy of farmers.

Tactful enough to avoid upsetting

and embarrassing farmers in difculty.

Ready to help without interfering.

Ability to challenge farmers’ thinking without criticising them.

INITIATIVE

Ability to work alone and without supervision

and without waiting for guidance and support from superiors.

TEACHING ABILITY AND UNDERSTANDING

Beyond advising, help farmers to make

their own decisions through sound economic reasoning.

Understand that improving the farmers’ businesses

also depends on non-business factors such as

relationships and other personal commitments.

Understand that farmers often feel alone

and unsupported in making changes to their farm

businesses as such changes can be very uncertain;

they need help to overcome fears and reservations.

SENSE OF RESPONSIBILITY

Prudent and responsible.

Balance own responsibility with the understanding that it is the

farmer who decides how the farm should be managed.

The role of the farm management specialist in extension

Farm management extension 15

Collaboration and leadership

In addition to dealing with farmers, extension workers

and other stakeholders, specialists in farm management

should collaborate with other subject matter specialists.

These may be specialists dealing in crops or livestock or

other areas of interest in farm management.

Farm management specialists should also have

the ability to motivate and guide front-line extension

workers in the public, private and NGO sectors. Given

the holistic nature of the work, the management specialist

should act as a leader among those working with farmers.

* * *

TEAM SPIRIT

Work in a team with other local agricultural advisers and specialists.

Instil a team spirit in farmer groups.

ORGANIZATIONAL ABILITY

Able to plan extension work, to organize its implementation

and generally to manage and effectively control

an extension ofce and its activities.

COMMUNICATION AND FACILITATION SKILLS

Able to communicate using many media

including verbal, non-verbal and written communication.

Able to help others understand, learn

and acquire knowledge and skills.

16 The role of the farm management specialist in extension

ORGANIZATION OF

FARM MANAGEMENT SUPPORT

The farm management specialist has the potential to

contribute not only to extension work, but to planning,

project preparation and policy analysis. The specialist

can bridge the gap between the farmer and the planner;

the farmer and the researcher; the farmer and the policy-

maker and the farmer and the private sector. By having

access to farm management data and preparing farm

plans, the specialist is well placed to contribute to policy

formulation, project plans and national plans. As planning

often requires considerable expertise and experience,

these skills are often invaluable in this task.

Specialists should be located within the extension

services where they can be of most support to front-line

extension workers and other subject matter specialists,

planners and policy-makers.

There are many options of where a specialist can

be placed in the overall organizational structure. Choices

will be determined by need and resources and by the

availability of specialist personnel. No matter where

they are placed, they will often nd themselves at the

intersection between planning and extension, and at the

intersection between research and extension because

farm management information is needed in all areas of

service delivery to farmers.

Given the scarcity of public

funds for their work, extension

service management will

need to be creative and

strategic in locating farm

management specialists.

Chapter 2

Diagnosis and investigation

This Chapter looks at the role of the farm management

specialist in diagnosis and investigation and the

tasks involved. It describes farm enterprise analysis,

benchmarking, market appraisal and value chain

analysis but does not go into detail on methodology.

It briey describes the methodologies and makes

reference to materials for further learning.

Those extension

workers who

specialize in farm

management have a

number of key roles

to play

18 The role of the farm management specialist in extension

KEY ROLES

The specialist in farm management has ve key roles in

providing strategic guidance:

1. Preparing and sharing area proles based on data

and information collected on the biophysical and

socio-economic background of the area being

considered.

2. Providing extension services and, through them,

farmers with information on the protability and

competitiveness of farm enterprises.

3. Providing assistance to research staff in research

stations and institutions and to extension service

providers by prioritizing technical areas of research

concentration.

4. Analyzing market opportunities for high potential

agricultural products and support private sector

investments.

5. Providing policy-makers with guidance and support

from farm-level studies conducted in the area.

These roles all require the collection of micro-

level data – farm and local market information – and

their analysis, compilation and presentation to a diverse

range of users. Specialist staff, wherever they are

located, have a critical role in managing and conducting

investigations of priority issues. They are also often

responsible for leading or facilitating teams of experts in

conducting market appraisals and value chain analyses

and conducting farm protability analyses.

Area proles should

include a description

of the farming

system, farm types

and sizes, market

outlets, input supply

sources, agro-

processors, service

providers ...

... and successful

farmers and rural

entrepreneurs

Diagnosis and investigation

PREPARING AREA PROFILES

Area proles are a collection of information about a location

(e.g. zone, district, region) of interest to planners, policy-

makers, extension workers and investors. Area proles

comprise statistical tables together with diagrams, charts,

maps and explanatory text. They should provide an

understanding of the conditions of the particular area as well

as the dynamics of change. Area proles are invaluable for

farm management specialists working at the farm level,

and for extension workers, planners and policy-makers

to better understand the area’s unique circumstances

and its relative position within the national agricultural

economy.

Area proles will help specialists to thoroughly

familiarize themselves with the problems and the

opportunities in the area. The information can also be used

to create a database for analytical investigation, planning

and extension.

Area proles should include all the information

that could be of value and use to the diverse audience

of information users: a description of the farming

system, farm types and sizes, market outlets, input

supply sources, agro-processors, service providers and

successful farmers and rural entrepreneurs situated in

the area.

To prepare an area prole, the specialist also

needs to make a thorough inventory of secondary data

found in censuses, special studies and other reports

about the area. Information can also be gathered by

speaking to farmers and other stakeholders located in

the vicinity.

The information

gathering process

should ultimately give

the specialist a clear

idea of the farming

system of the area ...

... and the potential

problems,

opportunities,

possible action

20 The role of the farm management specialist in extension

The next task is to map out and analyse the

information collected. First, a database should be set

up with information collected on the physical, social

and economic aspects of the area. This mapping helps

identify the different farming systems in the area which

enables extension workers and planners to understand

better the variations in farming.

FARMING SYSTEMS

A farming system can be dened by the number

of individual farm systems that have broadly

similar resource bases, enterprise patterns,

household livelihoods and constraints.

Depending on the scale of the analysis, a

farming system can encompass a few dozen

or many millions of households.

Source

http://www.fao.org/farmingsystems/

description_en.htm

From this overview, the farm management specialist

can identify specic crop and livestock enterprises and

calculate the protability and the potential that they have

for economic success. Supporting this, the specialist

should identify specic market opportunities for crop,

livestock or other products that can be successfully

produced within the various agro-ecological zones.

The farm management specialist should also

gain a broader understanding of other aspects including

identifying and mapping out input suppliers, agro-

processors, traders, nancial sources, service providers

as well as successful business enterprises (small and

medium size enterprises and farmers). It would then be

possible to assess the demand among farmers and other

stakeholders for support services.

Diagnosis and investigation 21

The information gathering process should

ultimately give a clear idea of the entire value chain;

inputs, products, processing, marketing and the

individuals, problems and opportunities involved. The

specialist should also have gained some idea of possible

actions worth investigating.

The data thus gathered is compiled into a prole

that provides stakeholders (private and public) with

information about the area.

PURPOSE OF BUILDING

AN AREA PROFILE

Describe the farming systems

and farm types

Access the potential and constraints

for particular commodities and products.

Identify areas of the region with particular

strengths and weaknesses for agricultural

Locate input suppliers and market outlets.

Compare the distribution of resources.

Identify successful cases of farm businesses

and ‘benchmark’ farms

Identify service providers.

Identify market infrastructure weaknesses

Formulate linkages with

rural finance institutions.

Establish a platform of dialogue among

farmers, the public and private sector

22 The role of the farm management specialist in extension

AN EXAMPLE OF AN AREA PROFILE

There is no “correct” way of collecting, compiling

and analyzing information. It should be tailored to the

type and quality of the data available and the resources

available for collection and compilation. Much also

depends on the type of problems or issues that are

important for extension, planning and policy-making and

the opportunities that the area offers for agribusiness

development and fostering market-oriented farming.

Farm management specialists need to carefully

consider the choice of methods for organizing area based

proles. The best method is the method that delivers an

outcome that will be useful for all.

Data requirements and sources

This guide divides data requirements for area proles

into three broad categories:

• farming systems

• marketing

• socio-economic data.

Physical

environment

Support services

• Finance

• Inputs

• Extension

• Research

Input supplies

Policy and enabling

environment

Farming system

• Farm

• Land

• Capital

• Labour

Household

• Family structure

• Goals

• Food security

needs

Market outlets

Value chain

actors

Diagnosis and investigation 23

Farming systems

Data and information about farming systems is the

basic requirement. In any single area there are often

many farming systems and, within these, farm incomes

vary widely. The farm management specialist needs

to know what causes income variations, who are

the most vulnerable farm households, who comprise

the better-off farm households and what is the most

appropriate support for these households.

Farming systems

• Natural

resource base

• Climate

• Landscape

• Farm size

• Farm activities

• Technologies

used

• Integration of

crops, livestock

and other

activities

Marketing systems

• Market outlets

• Prices of

products sold

• Marketing costs

• Marketing

channels

• Levels of trade

• Market changes

Socio-economic

information

• Income

patterns

• Food security

issues

• Employment and

labour data

• Rural

infrastructure

• Support

service

provision

• Value chain

actors

Figure 6

Data requirements

foranareaprole

24 The role of the farm management specialist in extension

Farming systems information is needed by

extension workers to assist farmers to diagnose their

farm performance, to set objectives, to plan, implement

and control farm activities, and to make more efcient

use of their limited resources. To develop a farm system

prole, the following information is needed:

• available natural resource base

• climate

• landscape

• farm size, tenure and organization

• dominant pattern of farm activities

and household livelihoods

• main technologies used

• integration of crops, livestock

and other activities

• farmer capacity

For each of these the specialist needs to investigate

a number of key issues and record the management

practices applied, the effect of these elements on farming

system choices, and their effect on other aspects of

farming such as labour, sustainability and access.

Available natural resource base. Land and soils, water,

and vegetation, grazing areas and forests.

• Land and soils. Texture, acidity, fertility, organic

matter content, depth, ease/difculty of cultivation,

drainage, and salt content.

• Water. Availability, quality and affordability of water

for irrigation; existing management practices and

availability, quality and accessibility of drinking

water to homestead.

• Vegetation, grazing and forests. Permanent

grasses, shrubs and bushes, wild/planted trees,

trees, and medicinal herbs.

Climate. Rainfall distribution, temperature, humidity,

natural calamities (oods, droughts, typhoons).

Diagnosis and investigation 25

Landscape. Topography and altitude.

Farm size, tenure and organization. Layout of the farm,

nature of land ownership and business management

arrangements.

Dominant pattern of farm activities and household

livelihoods. Crops, vegetables, livestock, trees,

aquaculture, hunting and gathering, processing and

related cost, production and marketing patterns and

information on employment and on-farm and off-farm

sources of income.

Main technologies used. Tools, equipment, traction

and production programmes to determine the intensity

of production.

Integration of crops, livestock and other activities.

Information on how enterprises are integrated and

managed.

Farmer capacity. Farmers’ skills and their problems

and assistance that farmers believe they require

to help them market their products and improve

profitability.

In the process of gathering information on farming

systems, the FMS should also identify ‘successful’

farmers who can be regarded as ‘innovators’ that are

able to identify new income generating opportunities and

successfully exploit market niches.

Marketing systems

Farmers and rural entrepreneurs also require information

on markets and marketing on a regular basis including

market outlets, prices of products sold, marketing costs

(handling, transportation and storage), market margins,

market channels and levels of trade and market

changes. The task for the specialist is to identify and

assess potential markets for different products that can

increase farm prots.

26 The role of the farm management specialist in extension

Farmers require accurate and

up-to-date information on market prices,

production levels, on the costs of inputs

and also materials in order to make informed

farm management decisions.

On-the-spot study of a rural market and marketing procedures

Prices vary by location and level of market activity

Recording market prices

Diagnosis and investigation 27

An important task for the

specialist in farm management

is to identify reliable and trustworthy

sources of information ...

... information of this kind

can be found at many levels.

Computerization of market price data

Market price data broadcast

through the local radio

Super markets are competitive and frequently lower priced

Socio-economic factors

also inuence markets

and the decisions

that farmers and

entrepreneurs make

28 The role of the farm management specialist in extension

Farmers and rural entrepreneurs also require

information about inputs, equipment and materials in

order to make production decisions. The information

needed includes knowledge of reliable and trustworthy

sources of inputs suppliers, equipment and machinery

manufacturers, prices, quality of items and on reliable

sources of spare parts for tools and equipment and

maintenance supplies.

Socio-economic information

Farm management specialists should also collect

information on social and economic factors that inuence

the broader community including community leaders

and lead farmers, rural infrastructure, support services

and value chain actors including processors, traders,

input suppliers and farmer organizations – formal

and informal – operating in the area. It also includes

assessments of how well farmer organizations are

performing; identifying their strengths and weaknesses.

Additionally, socio-economic information is needed on

employment in the area.

* * *

FARM MANAGEMENT INVESTIGATIONS

Prot-orientation, market-orientation and diversication of

farming has brought about changes in farm enterprises

and the input-output relationship between them. It has

inuenced the composition of farm enterprises, their size

and use of land, labour and other resources. Specialists in

farm management need to investigate the protability and

efciency in the use of inputs; it is a key area of investigation

to support farmers’ pursuit of greater protability.

Farm management

analyses are essential.

They help farmers and

extension workers

understand how the

farm business is

performing

and to determine

its protability

The result of a well

conducted farm

management analysis

can provide useful

insight into

farming systems

and farm types

Diagnosis and investigation

Farm management analyses are essential to

help farmers and extension workers understand how

the farm business is performing and to determine its

protability. Analyses can help locate weaknesses

and ways to correct them. They can highlight areas

of good performance so they may be exploited more

fully. Farmers need the analyses to make decisions to

improve farm performance.

Farms in any given location are rarely

homogenous. Each farm and household has unique

conditions, characteristics and farming systems.

However, there are often many elements in common

and thus farmers may share a common farming system

in that they have similar objec tives and resources (in

terms of both quantity and quality), produce similar

products and undertake similar activities on and off the

farm within similar biophysical, economic, socio-cultural,

policy and institutional environments. Those farms that

belong to a particular farming system can be expected

to have similar potentials in terms of productivity and

income.

In order to investigate farm performance and

recommend improvements, the farm management

specialist and the extension worker must understand

the overall farming system and its links as well as

the variations that exist in farm types. Thus a priority

responsibility of the specialist is to collect farm-level

data and develop a typology of smallholder farmers

according to their individual farming systems.

Diagnostic techniques that can be applied at

farm-level can help extension workers and farmers

recognize the critical problems limiting farm profitability.

Many of the conventional farm management tools fit

into this broad category. They include constraints

analysis, gross margin analysis, budgeting, cash flow

analysis as well as more specialized farm management

methods such as financial statements, balance sheets

and risk management.

30 The role of the farm management specialist in extension

Farm performance analysis — Benchmarking

The most useful diagnostic tool in farm management

is “farm performance analysis”. Here, nancial results

and the components of the production and marketing

system are compared with benchmarks. Comparisons

SIMPLE FARM MANAGEMENT

DIAGNOSTIC TECHNIQUES

Constraints and opportunities analysis. An

instrument used to help identify weaknesses and

potentials and the causes of those weaknesses.

It helps develop strategies for overcoming the

weaknesses and building on the potentials

identied.

Enterprise budget. Estimate of the output, cost,

and protability of individual crops, cropping

patterns or livestock enterprises. Each type of

crop or livestock that can be grown or raised on the

farm is an enterprise. A very simple and practical

type of enterprise budget is the gross margin.

Gross margin. An indicator of the protability of

farm enterprises and technologies, obtained by

subtracting the variable costs from gross income.

It can be used to analyse the performance of

existing enterprises and to estimate protability

of proposed enterprises

Benchmarking. This involves studying and

comparing the actual performance of a farm/

enterprise with farms/enterprises of similar size

and farming system for detailed nancial and

technical analysis. The intention is to identify

strengths and weaknesses and steps to improve

performance. The differences between the farm/

enterprise being studied and the benchmark are

used as the basis for improving performance.

Diagnosis and investigation 31

can be internal to the farm business or external with

other farms. The performance of an individual farm

can be compared with the standards set, identifying

weak points and actions for improvement. Performance

analysis can also be done for a single enterprise,

where the protability and efciency of that enterprise

is analysed.

Farm management specialists need to be able to

listen, analyse farmer’s problems, research information

and suggest innovative practical solutions on a wide

variety of business issues. They can assist farmers by

making them think through the main issues they need

to consider. They need to assess farmer’s knowledge of

critical business issues before they start helping them to

develop their business plan.

STANDARDS OF PERFORMANCE

AND BENCHMARKS

Standards of performance. The standards

relate to technical and nancial performance

and efciency. Technical performance standards

involve physical measures such as yields

of crops, production of livestock, or use of

inputs such as labour. Financial standards are

measured with instruments as enterprise or total

gross margins per hectare (or per unit of some

other resource) such as net income per hectare

or return to total capital.

Benchmarks. Generally, benchmarks for

farms are made up by averaging the actual

performance data from a large group of

farms. The benchmarks are typically derived

by selecting one-third of the farms in a

large group that are the most profitable and

averaging the performance measures from

those farms.

32 The role of the farm management specialist in extension

Demonstrations and on-farm trials

Demonstrations are becoming increasingly important to

test new technologies and enterprises as a way of making

the most of market opportunities. Farm management

specialists assist front-line extension workers to evaluate

the results of demonstrations and on-farm trials. They

mainly advise on record-keeping to ensure that the data

are sufciently complete and reliable so that farmers can

have condence in the information generated.

DATA REQUIREMENTS

Background data. Land use or eld history going

back two or three seasons such as methods of

land preparation, yields, fertility management,

crop rotations, residue management, soil type,

texture, terrain, slope, vegetation, system of

water control, fallow periods.

Technical input data. Data on the inputs

applied to the demonstration including the

type of inputs used; the rate of application;

the method of production and family and hired

labour requirements.

Input-output response data. Data on the

performance of the crop under the different

technologies. This implies developing a

response relationship between inputs and

outputs.

Product price and input cost data. Data on

input and output prices. Data on what inputs

to apply, their unit and total cost and where to

obtain them would be useful for farmers ready

to innovate.

Farmer assessment data. This data is

subjective, based on farmer’s own observations.

Evaluations of

demonstrations are

most fruitful when done

in collaboration with

farmers and extension

workers in the eld

Diagnosis and investigation

Farm management specialists assist farmers

and extension workers evaluate the trials and

demonstrations. Evaluations should provide findings

and conclusions that can assist extension workers

in designing suitable extension programmes. They

should include a technical appraisal of the feasibility

of the new technologies, an assessment of financial

performance to check if the technology or enterprise

is potentially profitable, and an evaluation conducted

together with the farmers involved.

Compilation and analysis could be carried out

by the farm management specialist alone, but it is most

fruitful when done in collaboration with farmers and

extension workers in the eld.

Specialists also have the task of analyzing

data to produce the standard information needed for

farm management handbooks to be used by front-line

extension workers in their day-to-day work.

CONTRIBUTIONS OF FARM-LEVEL

INVESTIGATIONS

Production and farm management. Providing

information that allows constraints and

opportunities to be identied at the farm level.

Marketing information. Provides insight into the

workings of rural markets, pricing mechanisms,

marketing margins, channels of product

ow, farmer perceptions towards marketing

efciency, transport issues, affects of subsidies,

tariffs and other regulatory instruments on the

farm community.

Monitoring and evaluation. Generate

information on the impact of technology changes

and investments. The studies can shed light on

baseline situations.

FARM MANAGEMENT HANDBOOKS

Compilation of farm management data can

take the form of databanks of reference data

and Farm Management Handbooks. The

preparation of standard data as benchmarks

could also be compiled in the handbooks or

alternatively stored in electronic databases

(e.g. spreadsheets). The farm management

data may be used for farm budgeting and

local level planning. The information provided

in the Farm Data Handbooks could be of

use to sectoral and national planners, policy

makers and agricultural extension workers.

Regular and frequent updating is necessary

in order to guarantee their usefulness.

34 The role of the farm management specialist in extension

The results of

market appraisals

are a useful tool

for all ...

... business

management

specialists,

extension workers

and farmers ...

... in addition to

rural entrepeneurs

and potential inventors

Diagnosis and investigation

MARKET APPRAISAL

Appraisals involve gathering information about market

constraints and opportunities, market channels and

market prices for products. This includes collecting

information on prices, consumer demand, identifying

new crops to grow and sell in existing or new markets.

The appraisals can also be used to identify potential

customers and outline strategies for attracting them.

Market appraisals look at the opportunities of those

agricultural products that have a marketable potential.

In brief, in order for marketing appraisals to be

satisfactorily conducted the starting point is obtaining

thorough knowledge of the products to be produced, the

demand for produce sold, estimates of production and a

review of potential customers.

In order to better focus the market appraisal, the

FMS should review the productive capacity of the area,

draw up a list of possible products to be sold on the

market and map out the marketing channels and ows of

produce through them. This is commonly done in the form

of mapping the product ows between the different links

along the market channel. Through developing maps of

market outlets, specialists can clarify which actors are

involved in marketing the product; what products have

market potential; where the nal markets are; what the

geographic coverage is of the marketing channel and

who are the most important actors in the chain. Thus,

the specialist will be able to identify the key buyers to

interview to collect information on the product and the

market. Extension workers can use this information

to provide advice and guidance to farmers and rural

entrepreneurs so that they can appropriately orient their

production and marketing activities. Appraisals should

cover specic questions some of which are outlined in

the checklist shown at the end of this section.

36 The role of the farm management specialist in extension

Table 1

Information requirements for market appraisal

Product

identication

• Check if the products are tradable (import substitutes, export crops,

substitutes, non-tradable food crops)

Production

information

• Area planted (ha) (per season), time of sowing and harvesting

• Area harvested (ha), percentage of harvested area

• Yield per ha (over time)

• Quantity produced

• Level of sales and percentage of sales

• Percentage spoilage

Information

on processing

• Capacity, location, number of processing outlets

• Use of raw material to nished product (percent of turnout)

• Quantity produced

• Demand for processed goods

• Processing costs: raw material, labour, fuel, electricity, maintenance

Demand

information

• Current and projected demand

• Per capita consumption: local consumption habits,

elasticity of demand

Prices • Retail, wholesale prices, farm-gate prices

Imports

• Type, quantity, value, price of imports (into the country and region);

FOB (free on board) prices

• Marketing cost of imports; import arrangements; collection

arrangements

Exports

• Type, quantity, value, price of exports (out of the country and region);

CIF (cost, insurance, and freight) prices

• Marketing cost of exports; export arrangements; collection

arrangements

Market

channels

• Destination of different products: amount sold to each market;

number of traders and intermediaries (for each product category)

Trade

• Flow of sales (from region to market): amount for local consumption;

amount sold outside the region; amount exported

Market costs

• Preparation cost, transport costs (according to type of commodities:

bulky or dense), handling costs; packaging materials and costs,

storage costs, commissions, marketing margins;

break-even cost of production

Consumers

• Preference for products (health, nutrition, income, etc.), opinion of

consumers for different types of processed products (quality, price,

health) and substitutes

Input

provision

• Use of purchased inputs; main purchased inputs; availability of inputs;

quality of inputs

Diagnosis and investigation 37

A CHECKLIST OF QUESTIONS

FOR CARRYING OUT A MARKET APPRAISAL

Access

 What formal and informal barriers limit access

to the market (e.g. unofcial payments)?

 How much time does it take to reach the market?

 Are there alternative routes to reach the market?

 What are the costs of transportation?

 Are there alternative forms of transport?

Handling

 What handling services for on-loading

and off-loading are available?

 How do the handling services operate?

 What are the limitations?

 Are there alternative ways of handling?

 Can cheaper transport be used?

 W h a t t y p e s o f t r a n s p o r t c a n b e u s e d

to get to the market?

Storage

 For what products are storage facilities available?

 What are the storage costs?

 Are they reasonable?

 What is the condition of the facilities?

 Who pays for storage?

 What is the storage loss rate?

 What are the major causes of loss?

 Are there alternatives for storage?

38 The role of the farm management specialist in extension

Market prices

 Are market prices satisfactory?

 Do prices vary widely between seasons or months?

 How can market prices be improved?

Product demand

 What commodities sell the most?

 What quantities are sold?

 What are the potential quantities that can be sold?

 How should the produce appear?

 How is the produce displayed?

 What products have a high demand?

 Are there alternatives forms of produce that have

a high demand (e.g. processed, dried)?

Competition

 Who are the main buyers?

 How many buyers are there in the market?

 How many wholesalers are there in the market?

 How many retailers are there in the market?

 What type of products do they buy?

 What are the market shares of the different buyers?

 W h i c h b u y e r s a r e l e a d i n g t h e m a r k e t ?

Are they growing?

 How many sellers are there in the market?

 Are there any clear competitors for the produce

sold from the region?

 Do any of the sellers have a competitive,

advantageous position?

Diagnosis and investigation 39

Market channels

 What is the terminal market? Where are these

markets?

 Are there alternative market outlets/channels

that could provide higher prots?

 What factors (e.g. value-adding, packaging, quantity)

might open up new market channels?

* * *

STEPS IN CARRYING OUT MARKETING

AND VALUE CHAIN ASSESSMENTS

Identify productive capacity and possible

product groups

Characterize and map the market channels for

different product groups

Collect secondary information on nal markets

Collect primary information from chain actors

Organize results

Value chain analysis

explores market access

and competitiveness of

farmers and other value

chain stakeholders

40 The role of the farm management specialist in extension

VALUE CHAIN ANALYSIS

Value chain analysis is a more sophisticated and complex

form of market appraisal. It explores market access as

well as the competitiveness of farmers and other value

chain stakeholders – processors, input dealers, traders,

retailers, consumers. The importance of value chains is

that protable farming depends on the competitiveness

of the entire chain and the ability of service providers

and investors to address constraints and opportunities.

The areas for action are broader than the limited role of

both the extension services and the farm management

specialist. Value chain analysis requires the involvement

of a range of stakeholders from government, the private

sector, producer organizations and farmers to name a few.

Value chain analysis must be a team effort. In this

respect, the specialist might be expected to manage a

team of experts. In other situations they may be used as

facilitators of other experts or called upon to explain the

OBJECTIVES OF VALUE CHAIN ANALYSIS

To identify market opportunities for the area

To analyze the chains from different

viewpoints and propose concrete actions to

improve competitiveness

To coordinate the supply

and demand for business services

Protable farming

depends on the

competitiveness of

the entire chain and

the ability of service

providers and investors

to address constraints

and opportunities

Diagnosis and investigation

value chain approach to a wider group of stakeholders,

who may then task a technical group to do the detailed

analysis. Farm management specialists could also

participate directly as team members representing public

sector interests. In all situations they must have at least

an understanding of value chains and how analyses

should be conducted.

Specialists should also possess an adequate

understanding of value chain analysis to manage and

participate in the study. Although analysis begins by

understanding the local potential it often requires an

appraisal of opportunities that lie further aeld.

Value chain analysis is not an end in itself, but

its results feed into decisions of both private and public

value chain stakeholders. Private enterprises can use the

results of an analysis to set out a vision and an upgrading

strategy for their businesses and the value chain at large.

Public agencies need the results for implementing value

chain development projects and planning supportive

actions. This is where farm management specialists

have a direct role to play.

USE OF VALUE CHAIN STUDIES

Solvingissuesinaspecicvaluechain

A set of suppliers, transporters, wholesalers and

retailers may nd that they are having problems

in coordination and decide to use the value chain

methodology to help solve these problems.

Developingspecicbusinessstrategies

and partnerships

Retailers could decide to use the process

because of an explicit policy of trying to work

with local or small-scale producers or to explore

ways of improving existing relationships with

small-scale producers.

Chapter 3

Planning and project appraisal

Farm management specialists have a key function

to perform by helping policy makers and extension

workers make sound decisions. Here some of

the problems of planning for smallholder farms

are outlined. We look briey at farm investment

appraisal, the use of farm planning in project

appraisal and mention the part that farm planning

plays in extension design. Identifying research

problems and policy analysis are discussed and,

along the way, some of the common planning tools

are described.

Farm planning

helps farmers look to

the future and

to run their farms

as a business ...

... it allows farmers to

determine the optimum

combination of farm

production and farm

resources

44 The role of the farm management specialist in extension

FARM PLANNING

Farmers are increasingly nding themselves facing

strategic decisions that are vital to the long-term success

of their farm businesses. These include, among others,

whether or not to introduce machinery, construct new

farm buildings, and adopt a different combination of

enterprises.

Farm planning allows farmers to determine the

optimum combination of farm production and farm

resources. It is the process that farmers use to decide

how to better run their farms in the short- and long-

term.

Farm planning is closely related to farm

investigation and analysis which is an invaluable

source of information for making sound planning

decisions. The farm management specialist, as part

of the extension service, is responsible for designing

and conducting farm planning activities that support

extension. In order to do so effectively, the specialist

needs the information and skills necessary to develop

relevant and useful plans.

The concern of farm planning is to help farmers

move progressively to higher levels of productivity

and income along the road best suited to their specific

situations and the conditions that surround them. Farm

planning identifies many roads that may be followed

and tries to help each farmer find the one that fits his

or her situation best.

Looking ahead to take into account new

opportunities and changing conditions is not natural

for traditional farmers. They tend to look backwards

for guidance. Farm planning teaches farmers to look

to the future and run their farm as a business.

Planning and project appraisal 45

HOW FARM PLANNING HELPS

Farm planning helps farmers in an

organized, systematic and effective way to:

1. Find new ideas and methods that could

benet them from farming.

2. Critically assess their current situation and

past experience as a basis for deciding

which of the improved ideas best t their

specic situation.

3. Make denite decisions about what to do.

4. Identify new markets, assess the

protability and competitiveness of new

farm enterprises, assess the amount of

produce that should be sold, and the costs

of transportation and handling.

5. Clearly identify their supply needs for the

new plan; how much and what kind of seed,

fertilizer, or plant protection materials are

needed; where and when to get them and

their cost.

6. Identify their credit needs both short- and

medium-term; where to get it and its cost.

7. Get a better idea of the yield and production

that can be expected and the costs involved.

From that farmers can estimate the level

of prot and the amount of money needed

to pay off loans and how much they would

have left to pay for expenses and for other

uses.

8. Make investment decisions.

46 The role of the farm management specialist in extension

PLANNING TOOLS AND TECHNIQUES

Budgeting is a farm management method that

estimates costs and returns of alternative actions and

enables a choice to be made by comparing the nancial

results. Budgeting lies at the core of conventional farm

management analysis. All of the budgeting techniques

rely on gross margin analysis as the basic farm

management method used to assess farm enterprise

protability.

Partial budgeting, as opposed to whole farm budgeting,

assesses the potential ‘protability’ as a result of small

changes in the farm business. It is concerned with

evaluating the income from changes in technologies or

new enterprises introduced that affect only a part of the

farm business.

Programme planning is used to select farm enterprises

while taking into account the resource constraints of the

farm.

Mathematical programming techniques formulate

the resource allocation problem where an objective

is maximized within the restrictions imposed by the

quantities of resources available. Mathematical models

comprise methods of optimization subject to farm and

enterprise constraints. The most common form of

mathematical model is linear programming.

Farm investment appraisal is concerned with projecting

the income and cost ow over the life of an investment.

Farm investments can be regarded as simple decisions

whether or not to buy a capital item that lasts longer

than a single season or year. Examples are irrigation

equipment or machinery that is not used up immediately.

The planning decision is long-term. Some investments,

depending on their size and complexity can be regarded

as projects. Their nancial feasibility require that they

are appraised by discounting the future streams of costs

and benets according to two common indicators: net

present value (NPV) and internal rate of return (IRR).

The farm management

specialist can

provide the support

and information

necessary to develop

the farm as a business

Writing business plans

is a key area where

the farm management

specialist can provide

assistance

Planning and project appraisal

Developing the farm as a business can be difcult

given the many possible changes. The experience and

skill of a specialist can help to demystify the process,

to provide alternatives for business problems, to help

farmers develop a business plan and to get funding for

their farm business.

The specialist can also offer diagnostic and

advisory skills on immediate business issues such as

analysing cash ow, managing increasing sales volume,

or funding for farm business expansion.

Writing business plans is essential – it records

how the farmers want their business to develop and how

they want to achieve their vision. In some countries, the

main process for accessing funds for developing farm

businesses is by submitting a business plan to a bank

or other nance institution for a loan. This is another

key area where the specialist can intervene – helping

develop business plans at every stage of the plan.

* * *

FARM PLANNING AMONG SMALLHOLDERS

Farm planning has traditionally involved conducting

planning exercises on individual commercial farms. But,

when applying farm management to smallholders in

developing countries, a different approach is needed. As

mentioned previously, in developing countries there is a

shortage of skilled manpower with a background in farm

management and agricultural economics.

48 The role of the farm management specialist in extension

A PROCESS FOR IDENTIFYING

REPRESENTATIVE MODEL FARMS

Identify homogeneous areas. For example by type of

enterprise, topography, climate, soils, and economic

and social conditions. This activity could be conducted

by the FMS when developing an area prole.

Choose sample areas. Further classify the farms

identied in Step 1 according to similar agro-ecology,

topography and soil type. Representative areas

could be found for each main farm type categories.

Each of the areas chosen could then be studied

so that the FMS has gures on the total number of

farms and their land holding size

Select the most typical farm size groups. The next

step is to identify the typical farms. This requires

conducting a survey and listing the number of farms

and their sizes for each of the sample areas identied

in Step 2. Farms that are exceptionally large or small

or have characteristics that vary signicantly from

the rest would be dropped. This stage results in a

model size group for each of the sample areas

Select the most representative farms. This stage

involves taking random samples of the farms within

the size groups as identied in Step 3. The farms

could be sorted into three different categories of land

size: small, medium and large. A random sample of

farms from each category would be selected, with

one chosen to represent each size group from each

enterprise type. This gure could be reduced further

in order to identify the most common farm in each

selected type of farming area.

When applying

farm management

to smallholders in

developing countries ...

... planning individual

farms is not practical ...

... a different approach

is needed

Farm management

specialists can select

case study farms or

design farm models

that represent ‘typical’

farms found in the

area and use these

to demonstrate farm

planning

Planning and project appraisal

Further, in developing countries, farming is often

comprised of multiple smallholders producing crops

and livestock on small plots that are often dispersed.

Planning requires a lot of farm management data which

is scarce and can be expensive to collect. These factors

make planning of individual smallholdings excessively

expensive, inefcient and impractical. In this case farm

management specialists can do one of two things: they

can select case study farms or design farm models that

represent ‘typical’ farms found in the area.

Selecting case study farms. Specialists could

search for one or more farms that could be used as

case studies. The farms would be chosen on the basis

of their representation in the area. Specic case study

farms would be selected on a near random basis from

the entire population of farms and the sample would,

hopefully, be representative. These farms are used to

study and demonstrate farm planning procedures with

the results disseminated to other farmers in the area.

WAYS OF GROUPING SMALL FARMS

Identifying a ‘typical’ farm. Where farms are

similar, one of them may be selected as representative;

but where farms are different they would need to be

separated into smaller homogeneous groups. These

• Size. Useful because many important farm

characteristics are related to farm size.

• Nature of the farmers’ goals. Maximizing prots,

avoiding risk, fullling household food requirements

ensures learning meets the interest of the farmers.

• Level of technology used. Type of enterprises is

useful because many farm decisions are related

to these factors.

The farm management

specialist must take

care to correctly

identify ‘typical’

farm prototypes

50 The role of the farm management specialist in extension

groups would form the basis for identifying a farm that

is ‘typical’ of the farms most commonly found in the

area. Studying the typical farms can provide insight and

understanding about the majority of farms in the vicinity.

This approach serves an important function of

facilitating the analysis of changes in technologies or

enterprises on different groups of farms of the same type.

The results from the ‘typical’ or case study farm

will not apply specically to any one actual farm. The

intention in modelling is to generate results which should

reasonably or ‘on average’ apply to the farms they

represent. The plans are then submitted to farmers so

that they may choose the one they think is best suited to

their farms and goals.

Simple farm models: budgeting

Designing farm models requires preparing farm

enterprise budgets and whole farm budgets as essential

prerequisites for analysis. In both cases the data

requirements include the level of inputs and outputs, the

unit costs of inputs, the output prices and the resource

constraints. The budgets cover all the input-output

relationships of the farm enterprises.

A budget for land should show what and how

much can be produced. A labour budget should show

whether family labour will be adequate for the production

programme and the hired labour needed. The budget for

physical resources should indicate the inputs required.

Based on these budgets nancial analyses can be

carried out.

Often, fairly simple budgeting models are adequate

for the farm management specialist to prepare farm

plans. Budgeting models are very exible and budgets

can be constructed to include judgements as to how

farmers will react to changes in production and markets.

But budgeting can involve lots of calculations if analyses

are to be extended over a wide range of situations and if

all aspects of the changes are to be fully evaluated.

Calculations for

budgeting are easier if

spreadsheet software

is used on personal

computers ...

... this has brought farm

modelling within the

reach of specialists

Planning and project appraisal

USE OF COMPUTERIZED

TOOLS AND MODELS

Spreadsheet programmes such as Excel© allow

budgets to be easily calculated with only very basic

computer skills. Spreadsheets are particularly

appropriate for ‘what if’ analyses; models can be

developed to explore ‘what might be’ the situation

with and without change – comparing alternative

futures.

Spreadsheet models can be used to measure

the impact of technology changes and policy

variations at farm-level, and the technical, nancial

and economic feasibility of investment projects.

The risks and consequences of decisions can be

investigated by using break-even budgeting and

sensitivity testing.

More complex analyses often require help applying

mathematical models such as Linear Programming

and other applications.

Budgeting models are not optimizing models;

they just evaluate a given number of proposed

alternatives. However, the farm as a business is

complex, consisting of multiple operations with many

dimensions. Mathematical programming methods

can be used to construct sensible farm plans.

Note

Mathematical methods and techniques

have been criticized in their application

to farm-level problems in developing

countries as computers are often scarce,

programmes depersonalized and the

methods used hard to understand and

require extensive data and skills.

Investment decisions

are critical because

they tie up capital for

long periods of time

Farm planning

is the central factor

for successful

investment appraisal

Farm budgeting is

the building block for

information on nancial

costs and benets

52 The role of the farm management specialist in extension

FARM PLANNING IN INVESTMENT APPRAISAL

Encouraging investments facilitates the development

of market-oriented farming. Investments can be in the

form of saved produce, planting trees, building storage

facilities, purchasing tools, machinery or equipment,

irrigation schemes and livestock fattening investments.

Capital investment decisions are critical because

they tie up capital for long periods of time. Therefore, it

is important that the farmer is certain that the investment

is sound. Investment analysis is a means of assessing

whether or not a potential investment is worthwhile. It is a

process of determining the protability of an investment by

comparing it with the protability of alternative investments.

Investments can also be made on a larger scale

by the state, the private sector or a combination of both.

Investments can be at area, sectoral or national level

covering a range of farm types.

At whatever level the investment is intended, farm

planning is an essential part of investment appraisal.

In all cases farm planning data is needed. Appraisal of

investments is based on indicators of the value of costs

and benets. For farmers, appraisals call for investment

estimates of costs and benets measured in market prices.

Farm budgeting is the building block for information

on nancial costs and benets. An analysis of farm income

allows an assessment to be made of the incentives for

farmers to participate in the proposed project.

Farm management specialists have an important

role in this process by assisting project analysts, extension

workers and farmers to conduct farm-level investment

appraisals. To full this role, they need to possess

knowledge of the methods used in conducting appraisals.

Planning and project appraisal 53

PRINCIPLES OF PROJECT APPRAISAL

Time value of money. This means that a dollar

today does not have the same value a year from

now. The time value of money is simply a technique

by which future benets and costs are reduced to

a present value. The time dimension of money is

taken into account through the use of discounting.

Life of the investment. Investment appraisal

studies extend over its life and follows the principle

of ‘discounted cash ow analysis’, a subject

covered in numerous references.

Discount rate. An appropriate discount rate is

used as a ‘cut off’ rate to assess the nancial

viability of the investment. The rate used is

usually the cost of capital to the farmer and is

often assumed to be the rate of interest at which

the farmer is able to borrow money.

Indicators of protability. These indicators

are used to measure the value of the costs and

benets streams. The net present value (NPV)

is the difference between the present value of

the benets and costs of a project. The internal

rate of return (IRR) is the rate at which the

present value of the cost is equal to the present

value of the benet.

With and without net benets. Investment

analysis is conducted by comparing the situation

with the investment (or project) against the

situation without the investment (or project). The

focus is on the project’s ‘incremental’ benet

stream. The incremental net benet is obtained

by subtracting the net benet without the project

from the net benet with the project.

54 The role of the farm management specialist in extension

Farm management specialists

have an important role to play

in collecting and analyzing data

for better farm planning and investment decisions,

for policy makers and for extension workers.

Farmers learn how to measure land for farm management calculations

Disseminating farm planning information to a group of farmers

Planning and project appraisal 55

Extension workers being trained in farm planning

Farmers being shown a model plan

Farm planning is part of a process

that involves formulating goals and objectives,

collecting data on farm enterprise protability

and assessing the most protable combinations

and their investments.

56 The role of the farm management specialist in extension

Investment appraisals can be done for

individual farmers or rural entrepreneurs and for

groups of farmers as part of a development project.

Investment appraisals can also be carried out for

agro-processors and post-production groups. While

the method is the same, the focus of the work for

rural entrepreneurs, agro-processors or the like shifts

from farm-level to post production. Such studies might

include conducting appraisals of storage facilities,

local markets and agro-processing plants.

Farm management specialists can also play an

important role in appraising and preparing projects.

Here, farm planning techniques and skills are used to

prepare representative farm types that are combined to

cover all of the project participants and obtain values for

a project as a whole.

The number of models required depends

largely on the specific characteristics of the project.

Typical farm types are used to reflect the type of

farming system, the size of the farm and differences

in management.

In conducting investment appraisal, specialists

should possess knowledge of some of the key

concepts involved in investment appraisal. They also

need to possess the skills to undertake discounting of

project inflows (benefits) and outflows (costs).

* * *

Accurate and reliable

farm management

information

is needed ...

... for policies to be

correctly developed

and targeted

Farm-level analyses

allow policy-makers

to better understand

farm issues and gauge

the impact of policy

changes, improved

technologies and

market uctuations

Planning and project appraisal

FARM PLANNING AND POLICY ANALYSIS

Diagnosing and assessing the impact of agricultural policy

options can be constrained by a lack of knowledge of farm

resources, production practices and responsiveness to

changes in policy. Farm analysis and planning also have

an important contribution to make at policy level.

Farm-level studies could aim at better understanding

the behaviour of farmers with respect to their use of inputs,

their choice of markets and the effect that price and cost

changes, new technologies and new enterprises have

on their income. They can also address issues of market

access, input supply, access to credit and other factors

that affect farm performance.

Policies and programmes are meant to have real

impact. Often the impact is meant to be very specic (e.g.

improved market access) or is aimed at a particular element

in the value chain (e.g. post-harvest technologies). They

may relate to specic regional projects, crops grown in a part

of the country and to specic categories of beneciaries. In

order for policies to be correctly developed and targeted,

accurate and reliable farm management information is

needed and is increasingly valued by policy-makers.

Farm data is required to satisfy various aspects

of policy analysis. Analysts need farm-level data and

information generated through farm models. These

are essential inputs into national and sectoral studies.

Although specialists are not directly responsible for policy

analyses they can contribute by providing this information.

The farm-type models can be used to measure

enterprise protability, the risks involved, the technical,

economic and nancial constraints impacting on farm

income, and the likely impact of input or product price

policies on farm income and production.

58 The role of the farm management specialist in extension

After the critical constraints have been dened,

at all levels, alternative policy solutions can be identied

and assessed. Farm-level information concerning

farmers’ priorities, access to resources, input distribution

and marketing bottlenecks is essential for assessing

the likely impact of proposed policies. In many cases,

approximate costs and benets of different policies can

be estimated with specic attention given to their effect

on national or regional objectives.

Monitoring and evaluating the effects of the

implemented policies generates new information at

national- and farm-level. This information can be used to

facilitate adjustments to interventions.

These analyses allow policy-makers to better

understand farm issues and gauge the impact of policy

changes, improved technologies and market uctuations

on the farm household and to monitor and evaluate the

impact of policy on different types of farms.

TYPICAL AGRICULTURAL POLICY INITIATIVES

• Adjusting the terms of trade in favour of small-scale

farmers by introducing market efciencies, reducing

costs and improving farmgate prices.

• Promoting technologies to improve farm production.

• Expanding the farm resource base by capital

investment, education, training and mechanization.

• Reducing risk and uncertainty facing farm

businesses through providing better information

or stabilizing prices.

• Redistributing assets and income to reduce poverty.

• Assessing the impact of changes in prices

of products and inputs on farmers.

Farm planning

provides a good

foundation for

effective extension

programmes

Farm management

specialists contribute

not only to extension

but also to research

Planning and project appraisal

FARM PLANNING IN EXTENSION

AND RESEARCH

Extension is directly related to research. Without research

as the base there would be no extension service and

no public-sector support for extension. But without

extension, research has little to offer. Without the feed-

back of information from farmers and extension workers

to researchers, the content of research efforts would be

irrelevant. Synergies between research, extension and

farmers are critical for effective technology innovation,

development and transfer.

Farm management specialists have a direct role

in extension and a responsibility to provide farmers and

other extension workers with new ideas and clarication

on their merits and limitations. Specialists can help them

to see whether new ideas address their needs and can t

into their farm plans. The role of specialists is to advise,

counsel and guide farmers and other extension workers.

But it is ultimately the farmers who decide and bear the

consequence of their actions.

Farm management specialists as extension

workers, contribute not only to extension but also to

research and are invaluable to both. Farm management

investigation can provide much-needed feedback

information and this can contribute signicantly to

discovering new knowledge; a major research objective.

Extension

As mentioned before, farm management analysis and

planning are closely linked and are used to set priorities

for extension work in the eld. The farm models can be

used to design extension programmes. By classifying

small farm units into homogeneous groups, extension

advice is tailored to suit groups of farms with similar

characteristics. Results of these investigations are often

Investigations

carried out

with farmers

are the most

effective ...

... after all,

farmers know

their own needs

60 The role of the farm management specialist in extension

used to guide extension; it is not the detailed solutions

generated from a farm plan that are important but the

more general lessons that can be drawn from them.

Care must be exercised not to create standard

answers or packaged messages that cannot be easily

adapted to suit the unique situations of individual farmers.

Where possible, the investigations should be carried out

with farmers. Farm management specialists can lead this

process by establishing a small team of extension workers

and farmers to draw up farm plans for farms whose size

and system are typical of the local area. Only if the farm

plans are drawn up together with farmers will the plans

be realistic and successfully implemented. This is vital as

farmers know their own needs, their resource conditions

and limitations.

Once the ndings of farm planning investigations

have been made, the results need to be disseminated

to other farmers and farmer groups. In order to extend

farm planning strategically among a broad base of

farmers, extension programmes phased over time,

should be developed. This is the responsibility of the

farm management specialists and front-line extension

workers working together. Farmers can also participate

in the dissemination process, adding powerful credibility

to the process.

To develop the phased programme, initially, a few

strategic and favourable areas may be selected for focused

concentration. In each of these selected areas, only a small

number of farmers may be initially interested to work with the

farm management specialists in setting goals and making

plans for improvement. Those farmers who rst joined the

programme and have shown promising results from the

farm plans that were drawn up will, as time progressives,

have acquired considerable experience. They would then

be in a good position to assist their fellow farmers in making

practical plans for farm improvement. Over time, this

process can extend to an increasing number of farmers with

the aim of developing their farm planning skills and making

changes to their farming systems to improve protability.

Farm management

has the analytical tools

to enable research

organizations

to prioritize their

areas of work

Farm management

specialists can

contribute to research

planning and, if they

work together with

researchers, are well

placed to inuence

research policy ...

... they can generate

vital farm-level

information

on the impact of

new technologies,

innovations and

development options

Planning and project appraisal

Research

Farm management has the analytical tools to enable

research organizations to prioritize their areas of work.

Farm management methods can be used to:

• identify and analyse problems and constraints;

• assess the suitability of technologies

or innovations to farmers’ situations

prior to detailed location-specic research;

• plan, monitor and evaluate on-farm trials

and demonstrations;

• investigate alternative production and farming strategies.

Farm management specialists can generate vital

farm-level information on the impact of new technologies,

innovations and development options through guiding

on-farm trials and demonstrations on selected farms and

in well-located pilot areas representative of the major

farming regions.

Farm enterprise budgeting and farm planning

methods can be used to select, prioritize and evaluate

technologies and set research priorities. Farm management

studies on representative farms should evaluate the likely

protability and the expected rate of adoption of a new

practice or enterprise. If the individual farms are aggregated

they could measure the expected impact of a proposed

innovation within the area.

Farm planning and budgeting methods can also

support decisions on the allocation of scarce human

and nancial resources. They can be used to evaluate,

select and review aspects of research programmes. The

ndings of farm-level investigations can inuence the

allocation of funds for research.

Research institutes and experiment stations will make

a real and great contribution if their research programmes

can be shaped to meet the critical needs of farmers as

revealed by the farm management investigations and

planning.

Chapter 4

Linking farmers to markets

Farm management specialists have a role as

facilitators, linking farmers to markets. This involves

the development of long-term business relationships

with market outlets, strengthening producer-buyer

linkages, facilitating linkages with input suppliers,

nancial institutions and market outlets and helping

to negotiate contracts. Links can be achieved both

informally by building trust and formally through

contracts.

Farmers are beginning

to appreciate the

need to produce

for the market and

satisfy the needs of

nal consumers

64 The role of the farm management specialist in extension

MARKET LINKAGES

The desire among farmers to participate further down the

value chain is widespread. Just producing and selling is

not enough. Farmers want to capture more value from the

transactions that they make with buyers. Thus to add value

and move down the value chain, stronger collaboration

with other value chain stakeholders is needed.

Many smallholder farmers, particularly in countries

that have developed markets, are shifting their sales from

open markets towards more formal market arrangements.

This creates new obligations for farmers. Buyers demand

reliable and regular supplies from farmers. They expect to

have greater control over produce quality and safety.

Market-oriented production is very different from

the periodic sale of subsistence surpluses. It requires

farmers to conrm with buyers that they are in the position

to meet the buyers’ requirements. Often small-scale

farmers face difculties in providing consistent supplies,

even before they are required to meet quality and safety

standards. Farmers need to ensure that they can meet

buyers’ demands by supplying produce of consistent

volume and quality on a regular basis.

Reliability of supplies applies to all actors in the

value chain. Processors require the regular supply of

raw material from farmers. Processors, in turn, have a

commitment to supply nished products on a regular and

consistent basis to their buyers. Similarly, supermarkets

need to have a full range of produce available for their

customers at all times.

Farm management specialists have a role in

providing farmers and buyers with technical support in

marketing and post-harvest handling. They also support

small-scale farmers with advice in investment opportunities

Farm management

specialists need to be

well-informed of the

marketing outlets

Linking farmers to markets

as a way to ensure consistency of produce to buyers and

reducing the risks that they face. Investments can be made

in production and post-harvest equipment to introduce

new crop or livestock enterprises and crop rotations or to

capitalize selected specialized enterprises.

There are many constraints, however, limiting the

capacity of farmers to link to buyers. These include lack

of access to production or post-production technology;

limited market information on pricing and alternative

market outlets; and lack of farmer skills in negotiating

and bargaining. Area-level specialists are well placed to

support farmers in these efforts.

To support farmers specialists need to be well-

informed of the marketing outlets. They should make

regular studies of these outlets including issues of access,

prices, quantity and quality standards and packaging

requirements. They should also know which of the outlets

are reliable and trustworthy. They should know about the

transport and handling options and costs relevant to each

of the outlets. And they should keep abreast of contract

possibilities as they present themselves in the market

place.

* * *

CONTRACTUAL LINKAGES

The practice of contracting is becoming increasingly

common as markets develop. Contracting involves

buyers – traders, agro-processors and exporters –

entering into agreements with farmers to buy specied

quantities of produce at specied prices and quality.

Contracting can give

farmers access to

markets far beyond

those that they

normally use ...

... it can be appealing

for small-scale farmers

as it is a way to reduce

marketing risk

66 The role of the farm management specialist in extension

Developing contracts with buyers has the potential

to produce the following benets for farmers:

• inputs provided by the buyer;

• extension advice from the buyer

to meet quality standards;

• conrmed markets and prices for products;

• a means of gaining access to distant national,

regional and export markets.

Contracting relieves the producer of a great deal

of uncertainty with respect to marketing, on both the

input and output sides. Some buyers will provide support

services, such as technical and business advice, in

addition to inputs and credit. In more advanced contract

schemes – particularly in contract farming – buyers may

even provide mechanization services. (In some cases

the contracts may involve a third party with NGOs or

extension services providing marketing advice and

support for negotiating contracts.)

Offsetting these advantages, however, is the

possibility that the contract may break down after

considerable investment by the farmer. There is also

the potential loss of farmer flexibility in enterprise

choice. An ever-present risk is that arrangements

will collapse because of a lack of trust between the

parties.

On balance, however, contracting is appealing for

small-scale farmers as it is a way to reduce marketing risk.

Individual small-scale farmers may nd it difcult to enter

into contractual agreements because buyers are more

likely to set up contracts with larger farmers in order to

reduce overhead expenses. However, a group of small-

scale farmers might be attractive to buyers. Facilitators

can potentially play a signicant role in brokering such

access and agreements.

Farmers need to understand the terms and

conditions of any contracts they enter into. These

conditions will vary with each contract. Farmers often

Farm management

specialists can assist

farmers prepare

contracts and specify

the terms and

conditions so farmers

understand them

clearly

The farm management

specialist can help

clarify the position of

farmers and buyers,

assist farmers to

negotiate and develop

mutual trust

Linking farmers to markets

face difculties with this. Farm management specialists

can assist farmers prepare contracts and specify the

terms and conditions so farmers understand them clearly.

Specialists can also initiate agreements, (specically

in matching requirements of the market with farmers’

products); assist in identifying reputable buyers and farmers’

groups; help monitor and help enforce agreements; and

show the advantages of linking with both sides. The can

also assist with ensuring that:

• Agreements are fair and enforceable. This requires

that farmers know the basic elements of the

agreement and that the agreement is seen as fair

by both parties.

• Mechanisms and consequences are in place

to settle disputes should they arise.

• Alternative markets have been organized

in case of buyer default.

In order to draw up contracts, the expectations

from both parties must be realistic. This is not always the

case. Farm management specialists can help clarify the

positions of both sides, assist the farmers to negotiate

(or, in some instances, negotiate on their behalf) and

develop mutual trust between farmers and buyers.

To sustain contract linkages it is also necessary

to develop the capacity of farmers in contract negotiation

and compliance. Successful contract negotiations

require that farmers have reliable information and know

how to use it. This includes knowledge of their costs

of production and break-even prices. For knowledge

on their production costs, farmers should keep records

and be able to prepare enterprise budgets, market

margins and gross margins. Armed with this information,

negotiating skills and condence, farmers should be able

to successfully negotiate contracts with buyers.

Under contractual arrangements farmers have

to be able to synchronize production to ensure that

the product is available when the buyer requires it.

68 The role of the farm management specialist in extension

Therefore, activities must be clearly specified within

a time schedule in the contract. Farmers must work

strictly to the schedule. For crops, schedules include

planting material availability, planting dates, amounts

to be planted, harvest dates and expected yield. For

livestock products similar specifications would be

developed.

Farmers need to clearly understand the risks that

the contractor faces and the implications of those risks

for themselves. Farm management specialists can help

identify the risks to both sides, who bears the risk and

ways of mitigating them. Understanding risk and having

agreed mitigation strategies will contribute to trust and

the sustainability of contractual relations.

A CHECKLIST TO ASSIST

IN SUPPORT OF CONTRACTING

 Has a detailed analysis of the supply chain been carried

out? Have proposed linkage activities been based on

that analysis?

 What are the buyers’ purchase conditions in relation

to quality, safety, quantity, packaging, transport and

delivery, pricing and payment?

 What is the capacity of farmers to meet these conditions?

What training do they require? Are they able to make

the necessary investments?

 What difculties does the location of the farmers present

in supplying the market?

 How likely are farmers to fully understand the purchase

conditions, particularly in relation to pricing and quality?

What steps are needed to ensure they develop an

understanding?

 What would be the likelihood of side-selling (extra-

contractual marketing) for the envisaged crops? How

can this be minimized?

Linking farmers to markets 69

 Is a written contract necessary or is a verbal contract

sufficient? Who will draft the contract? What steps

can be taken to maximize the involvement of

farmers in this process and to ensure that they fully

understand the conditions of the contract?

 Does the contract allow for renegotiation in

situations of extraordinary events or circumstances

beyond the control of the parties?

 What costs would farmers incur in meeting

buyer conditions? How would these costs affect

profitability? Would returns be higher than existing

returns? Would returns justify any increase in risks?

 What transport arrangements would be used?

What transport is available? Is it suitable for the

planned products? What steps are necessary to

make suitable transport available? What are the

costs and how will they affect profits?

 What arrangements can be made for farmers and

buyers to meet? Can buyers visit farms? Can

farmers see how their products are marketed and

used?

 Is any external certification required for the

potential market? What is the cost of certification?

What costs would farmers face in meeting required

standards? How would these affect profits?

 How long has the potential buyer been in operation?

What risks are associated with the business?

 Does development of the market require any

support to processors? How can this be done with

minimal subsidy to ensure sustainability? Prior to

a decision to provide support, has detailed market

and business research been carried out to assess

the long-term viability of the company?

 Do other actors in the supply chain require technical

or financial support in order for linkages to be more

efficient?

Producer organizations

often need to be

strengthened to sustain

benets to members

over time

70 The role of the farm management specialist in extension

PRODUCER GROUP DEVELOPMENT

All too often, farmers are unsuccessful in getting involved

in activities at the upper-end of the value chain. This

is largely as a result of farmers being unable to afford

the high expenses of marketing individually. Farmers

organized in groups can reduce transaction costs,

achieve economies of scale and thereby make it possible

for farmers to take advantage of the upper-end market

opportunities.

The benets of farm organization, particularly for

marketing, include greater bargaining power, coordinated

production and better access to credit and other support

services. Alone, small-scale producers cannot provide

the volume of products required to be competitive in

modern markets. Small-scale producers also have little

power to protect their interests in the market. However,

groups of farmers working together shortens the supply

chain and often eliminates the need for local traders.

Producer groups not only ensure cost reductions, they

also strengthen the farmers’ bargaining ability, reduce

risks and ensure easier access to credit. For these

reasons producer organizations are valuable for linking

small-scale producers to markets.

Establishing and initially organizing producer

groups is only the rst step. The key is to achieve long-

term sustainability. This is not easy because it takes

considerable time for the leaders and managers of

producer organizations to learn the necessary technical,

management and entrepreneurial skills to keep these

organizations functioning effectively.

Producer organizations often need to be

strengthened to sustain benets to members over time.

A starting point is to ensure that farmers are organized

only when there is a clear benet to them in doing so.

STORAGE. Farmers group together for storage in an attempt to

obtain better product prices.

TRANSPORT. Transport costs are often very high. As a result

many farmers cannot afford to transport produce individually to

markets where higher prices can be attained. The organization of

farmers into a transport group can result in economies of scale

and lower transport costs.

AGRO-PROCESSING. Farmers working in groups can often afford

purchasing or hiring small-scale agroprocessing facilities which

can add value to their products. Examples are maize threshing

machines and milk processing.

BUYING AND SELLING. Farmer groups can buy inputs and

materials in bulk and attain better market information. As a result

they can strengthen their bargaining power.

Linking farmers to markets 71

STORAGE

TRANSPORT

AGRO-

PROCESSING

BUYING

SELLING

PROMOTION

FINANCE

PACKAGING

HANDLING

Figure 7

Functions of

producer groups

PROMOTION. Group marketing can foster specialized skills in

seeking more diverse market outlets. This will lead to marketing

benets, especially better prices.

FINANCE. Farmers operating as a group can usually better

mobilize capital and nance than individual farmers can.

PACKAGING AND HANDLING. Farmers as part of a group are in

a better position to handle and pack produce at lower cost. In this

way higher prices can be attained.

72 The role of the farm management specialist in extension

KEYS TO

GROUP MARKETING SUCCESS

Meetaspecicneed

Groups are most successful when they are

established to ll a specic need, that is doing

something that can be more successfully

completed through group rather than individual

action, for example processing.

Commitment from all members

Groups also need a high degree of commitment

from all members. Groups where a small number

of people take powerful roles while the other

members are passive are usually unsuccessful.

Effective management

Proper management is essential for success.

Successful groups generally hire professional

managers early in their existence to ensure

that goals are met and standards maintained.

The quality of the manager is key to group

success.

Linking farmers to markets 73

BENEFITS OF PRODUCER GROUPS

Producer groups help farmers:

• Improve the bargaining power of resource-

poor farmers when dealing with other

business entities through combining the

volume of several members to leverage

their position.

• Reduce costs through bulk purchase of

supplies and through lowering net costs for

individual members.

• Expand existing and develop new market

opportunities by offering larger quantities

of assured types and quality to attract

buyers.

• Improve product or service quality by adding

value to products through improved facilities

and equipment.

• Increase income through increasing

members’ bargaining power to improve

prices directly with buyers.

• Create employment for skilled

and unskilled labour to work for the group

business.

• Help weaker members who cannot do

business on their own improve their

business by helping them gain access to

better markets.

• Eliminate middlemen in transactions through

increased bargaining power to negotiate

better prices with buyers directly.

74 The role of the farm management specialist in extension

Sellers compete to sell their produce in a market

Farmers must be able to supply the market with

the quality required and the reliability of supplies

expected by the buyer and this frequently calls …

… for collective action by farmers.

Supermarkets require quality farm produce supplied regularly and reliably

Linking farmers to markets 75

A milk collection centre as part of the value chain

Community meeting to set up a farmer group

D Kahan

The organization of farmers into groups

is necessary to take advantage

of value chain opportunities

while linking farmers to suppliers,

nancial institutions and market outlets.

76 The role of the farm management specialist in extension

Farmers should come together around products

that create clear added value and have potential for

linking producers to buyers. The benets have to be

proven and clearly visible to members in advance.

Individual farmers may need encouragement to undergo

entrepreneurship training. Undertaking and successfully

completing training could be made a prerequisite for

receiving loans to establish new enterprises or develop

and expand existing businesses.

In most developing countries, public extension

systems have been discouraged from organizing farmers

because these groups could place political demands

on the national government. It is often preferred that

this role is taken over by NGOs or driven by buyers.

However, in many countries NGOs and private sector

drivers are few or even absent and the role of organizing

farmers rests with the extension service.

While the work of organizing farmers into

groups is given to the front-line extension workers,

they often lack training in facilitating this or do not

have the time to do this work. Further, there is also a

need for support to develop and strengthen the farmer

organization, enhance marketing and business skills

and access markets and support services. These tasks

require the support of specialist extension staff and, for

agribusiness, this could come from those specializing

in farm management.

The need for facilitation in developing farmer

organizations depends largely on the starting point of

the producer groups. In the case of a weak organization,

external facilitation and strengthening of organizational

capacities may be needed. This includes linking the

producer organization with higher-level networks

among farmers and potential service providers along

the value chain. The farm management specialist could

facilitate the process of organizational development and

supplement the farmers’ local knowledge with external

knowledge about potential markets, technology options

and relevant training and advisory opportunities.

Linking farmers to markets 77

CAPACITIES TO BE STRENGTHENED

AMONG MEMBERS OF FARMER GROUPS

OTHER AREAS OF CAPACITY BUILDING

WITHIN FARMER GROUPS

• Management skills and the capacity to

prepare business plans, manage nancial

capital and assess costs and benets.

• The capacity to secure inputs, nancial

services, and output markets.

• The capacity to support value-adding

innovation.

• Practicing transparency, accountability,

management efciency and business

growth.

• Literacy and numeracy skills to enhance

the viability of the organization’s

administrative procedures, nancial

management and bargaining operations.

• Effective advocacy, representation,

negotiation and lobbying.

• Active participation of women and other

marginalized social groups especially in

decision-making roles and bodies.

• Accessing market information.

• Increasing access to physical, natural,

economic, social and human capital.

• Market linkages.

78 The role of the farm management specialist in extension

Democracy and accountability within the farmer

organization also need to be enhanced to foster

sustainability

Of particular importance are commercial and

managerial skills as they improve farmers’ ability to

mobilize local resources, gain better access to credit

and engage more effectively in input supply and other

marketing activities. The farm management specialist

could oversee this work or provide guidance and support

to front-line extension workers involved in this.

In contrast, strong farmers’ organizations may

need little or no help to negotiate with service providers

and evaluate the received services. In such cases, the

priority for management support could be to strengthen

their networks in order to enhance the farmers’ voice at

higher levels (national, regional and international).

A CHECKLIST TO SUPPORT

FARMER ORGANIZATION

 Are farmer groups needed to link with the identied

market? If not, what are the advantages of working

in groups (e.g. overcoming high individual transaction

costs) compared to the costs that farmers may incur?

 Have alternatives to forming new groups been

considered, such as strengthening existing groups,

identifying traditional groups or working with lead

farmers?

 Does the planned linkage require formal groups with a

legal entity or would informal activities sufce?

 What have been the experiences with collective farmer

activities? Which type of farmer organization appears

to work best?

Linking farmers to markets 79

 What collective activities do the target farmers

presently carry out? What have been the experiences

with this?

 What discussions have been held with farmers about

forming a group or groups? What has been the initial

reaction to the idea?

 What is the social structure of the area? Does this

lend itself to successful collaborative activities? Is

there any danger of domination by an elite?

 Would different types of groups be necessary to

ensure homogeneity within a group, such as male and

female groups or groups organized according to roles

in the supply chain?

 What size should the groups be? What structure

should they have (officers, decision-making or

other)? Is there a possibility of formally associating

with other groups? What would be the advantages

of this?

 Have by-laws for the group been developed? Are they

fully understood and accepted by all members?

 Are there farmers who demonstrate leadership or

management skills? Does the proposed activity justify

the group recruiting a full-time manager?

 What training will farmers require in group dynamics?

 What training would group ofcers require in business

management, marketing, accountancy? How will this

be provided?

 What legislation exists relating to farmer groups? Is it

appropriate to the type of group envisaged?

 Would the group be legally entitled to operate a bank

account, if required?

Farm management

specialists can

help link farmers

to buyers by

identifying traders

and other buyers ...

... and arranging

for them to meet

with farmers

to create formal

market linkages

80 The role of the farm management specialist in extension

VALUE CHAIN STRENGTHENING

Value chain stakeholders represent all the actors

involved in product value chains linking production to

nal consumption. Farm management specialists can

help link farmers to buyers by identifying traders and

other buyers and arranging for them to meet with farmers

to create formal market linkages.

Value chain development often requires improved

coordination between stakeholders. New forms of

contractual relations will develop and the behaviour

of stakeholders will also most likely have to change.

Specialists can facilitate this change. Given the agenda

to build the institutional and economic capacity of value

chain actors, the extension service should encourage

the value chain actors to make upgrading efforts by

themselves and be in the position to adapt and develop

new business opportunities in the future. They can also

help develop the capacity of the value chain stakeholders

to do this. Facilitation is needed all the way along the

development process until this objective is reached.

Coordination and integration

Any form of cooperation requires initiative from an

experienced service provider who has the time and ability

to develop linkages and coordinate activities among

stakeholders.

Farm management specialists need to determine

how to accurately identify, target and implement

interventions – in partnership with other value chain

actors - in ways that generate long-term benets to all.

An understanding is required of the different actors in the

value chain and their roles in the market. Sustainable

linkages can occur only if there is concerted action and

mutual trust among key stakeholders.

Farm management

specialists can

facilitate new forms of

contractual relations ...

... leading to changes

in the behavior

of stakeholders

to improve value

chain coordination

Linking farmers to markets

THE FARM MANAGEMENT SPECIALIST

AS FACILITATOR

IN VALUE CHAIN DEVELOPMENT

• Create awareness and understanding on the

importance of chain development.

• Help stakeholders get to know each other.

• Draw attention to economic objectives and

business opportunities related to partnerships

in the chain.

• Facilitate value chain mapping and analyses,

especially jointly with stakeholders.

• Provide appropriate tools and methods.

• Help build a shared vision of the future.

• Forge a consensus on the objectives

and strategy of value chain upgrading.

• Identify change agents and facilitators,

and build partnerships.

• Facilitate planning and decision-making.

• Assist implementation of actions.

• Continuously monitor the process

and provide feedback.

• Mediate in case of conict.

• Facilitate exchange and joint experimental

learning among value chain actors.

• Document and share experiences

with the wider business community.

• Facilitate the coordination of different support

agencies active in the value chain.

• Facilitate negotiation of contracts with and on

behalf of farmers.

• Contribute to creating favourable enabling

conditions.

82 The role of the farm management specialist in extension

In order to promote trust and to share the

responsibilities and risks between actors, farm

management specialists need to nd and promote

practical ways of getting these actors together to provide

information, exchange experiences, resolve conicts and

negotiate relationships. Forums for negotiations, where a

common understanding and vision among the stakeholders

is created are central to orienting their actions towards

common goals and balancing competitiveness and

collaboration. They can facilitate this process together with

other bodies such as NGOs and chambers of commerce,

to name a few.

Support service provision

Increasingly, business management and marketing

advice is needed as a support service to a wide range of

stakeholders involved in the production and value-addition

of marketable products. Specialists in farm management

have a responsibility to determine which business services

can best address value chain constraints and potentials.

To do this possible intervention criteria are needed such as:

• Extent of impact on farmers and rural enterprises.

• Number of farmers and enterprises that will benet.

• Cost effectiveness

(relationship between cost and impact).

• Potential for resulting in sustainable business

services.

• Capacity of existing business service facilitators

to implement or manage the interventions.

• Time frame for completing the intervention.

• Availability of resources (human and nancial)

and donor interest.

• Synergy of interventions among various business

services.

• Ability to promote ‘win win’ relationships between

farmers and larger rms.

The objective of any proposed action should be

to develop markets for sustainable services to farmers

and rural entrepreneurs. Interventions can address

both supply and demand constraints. Regarding supply,

Linking farmers to markets 83

the capacity of private service providers to improve

the products or services they offer farmers and rural

entrepreneurs could be developed. Regarding demand,

farmers and rural entrepreneurs need to be more aware

of the services on offer. In both cases, farm management

specialists should promote improved linkages between

service providers and recipient clients.

The following are some possible interventions:

Training interventions

Linkage interventions

Input interventions

• Develop training materials for service providers

• Train input suppliers staff, government extension,

cooperatives, NGOs and lead farmers.

• Facilitate meetings between service providers

and training resource people.

• Collaborate with input supply rms to train

distributors/stockists in technical aspects

of the inputs they sell.

• Develop the capacity of input supply associations

to offer training to distributors and stockists.

• Train producer groups in techniques of bulk

buying.

• Train beneciaries in nancial management.

• Ensure interlocking linkages with market

and processing outlets.

• Create linkages with nancial institutions.

• Develop capacity of input supply companies

to use their network of distributors and stockists

to expand training and demonstrations.

• Promote supplier credit from micronance.

• Encourage input supply companies to offer

smaller packages of inputs.

• Encourage equipment supply companies

to offer after-sale support

Chapter 5

Training and extension

Access to technology and markets alone will not

make a farm successful or protable. At the centre of

the enterprise is the farmer. Thus the development

of the farmer is critical to success. One of the key

functions in extension is human development.

Awakening in farmers the consciousness and

fostering the ability to understand and make choices

about the operation of their farms is the primary

concern of extension.

As important as this is, it is often the case that

extension workers do not have knowledge and skills

in human development. This section will provide

some insight into this important aspect of extension.

The objective of

extension is to build

human capital by

increasing the technical

and managerial skills of

farmers and expanding

their capacity to learn

86 The role of the farm management specialist in extension

HUMAN CAPITAL DEVELOPMENT

The objective of extension is to build human capital – to

increase the technical and managerial skills of farmers

and to expand their capacity to learn. This is particularly

true in the areas of farm management and marketing. It

is the key task of the those specializing in management

to design, organize and deliver training and extension

programmes for extension workers, farmers, value chain

stakeholders and programme managers.

Building human capital requires specialized

knowledge, skills, and understanding. It requires

technical knowledge in farm business management and

marketing; practical skills in applying farm management

concepts and tools; skills in teaching extension workers

and farmers; understanding human development

processes and the contexts in which learning occurs;

understanding the people, their values and their attitudes

towards change; and a belief in the ability of farmers to

recognize and make changes for their benet.

In the past, extension and the training given to

extension workers was traditionally oriented towards

technical aspects of agriculture. Extension services

generally responded to the day-to-day production

problems that farmers faced. However, this happened,

at the expense of dealing with longer-term strategic

management and human development issues. The

situation is now changing as farmers respond to market

opportunities.

Training and extension in farm management has

become relevant, and increasingly in demand. The trend

towards market-led farming necessitates more highly-

trained, specialized and competent extension staff

and farmers who know where to obtain the information

needed to make better management decisions and

Training and extension

in farm management

has become relevant,

and increasingly in

demand

To use their skills

efciently farm

management

specialists must work

together with front-line

extension workers

Training and extension

nd solutions to problems. Farmers need skills and

knowledge to evaluate new options and learn how to

successfully produce and market high-value products.

Farmers need specic training and continuing assistance

from extension workers on how to develop and manage

these new opportunities. Developing the skills and

competencies of extension workers in farm management

and marketing is critical for the effective functioning of

the extension service. This is a prerequisite for building

the capacity of farmers.

Farm management as a discipline differs from

general agricultural extension. General agricultural

extension aims at delivering information to farmers for

better decision-making. Farm management extension

involves helping farmers learn how to analyse, interpret

and dene their managerial actions for themselves and

support them in decision-making. Rather than providing

ready-made solutions, farm management specialists

need to work at getting farmers to think through their

choices and learn from them.

As discussed earlier, there is a close relationship

between farm management diagnosis and investigation,

and planning activities and extension. On the one hand,

there is information from farm management analyses

and plans that need to be extended to farmers to

improve their farm management activities. On the other

hand, farm management investigations can be used by

extension services to aid their understanding of farmers’

information needs and their effectiveness in meeting

them. The work of specialists in this is gathering,

interpreting and disseminating information. They are a

key channel feeding information to farmers and other

stakeholders.

While this is the general function of farm

management extension, the task is divided between

farm management specialists and front-line extension

workers. To use their skills efciently farm management

specialists must work closely with front-line extension

workers (who may have had limited formal training in

88 The role of the farm management specialist in extension

farm management and marketing). This work entails

providing a framework for the activities of front-line

extension workers, developing training and advisory

service programmes and providing front-line extension

workers and farmers with reliable farm management

information.

Training extension workers

In public sector extension services there is often a large

variation in the academic qualications of extension

workers and subject matter specialists. This has led to

gaps in competencies and skills. Budgetary cutbacks

have resulted in limited funds for training. As a result,

extension personnel are often insufciently trained.

Shortages of adequately trained extension staff limit the

effectiveness of the advice offered. Capacity and skills in

farm business management are also weak in the private

and NGO extension services. Staff are often young and

lack the practical experience and specialized expertise

to provide effective and credible management advice.

For farm management extension to be effective,

training is essential at all levels; from front-line extension

workers (public, private, NGO sectors) to subject matter

specialists to policy-makers and programme managers.

Special guidance is needed for each of these categories

of extension staff through tailor-made programmes. This

is a key role for the farm management specialist.

Training farmers

Training and extension in farm management can serve the

needs of farmers by providing the knowledge and skills

needed to select new farm enterprises and appropriate

technologies. This can be achieved by helping farmers

develop their own capacity to dene problems and seek

solutions on their own initiative. Training is especially

needed for women farmers as they are actively involved

in many aspects of farming.

Training and extension 89

* * *

TRAINING SUPPORT

Training of extension staff contributes directly to the

development of human resources within the organization.

Training programmes are necessary to improve the job

performance of extension staff and develop new skills

and competencies. As noted earlier, most extension

staff are well-trained in technical agriculture. What they

generally lack are skills, exposure and experience in

marketing, farm business management and economics.

As a result they are ill-equipped to provide solutions to

some of the key issues faced by farmers.

There are four broad categories of training to

which farm management can be applied:

Training other stakeholders

There is also a demand for business management

training among other stakeholders in the value chains

including representatives of marketing organizations,

processing companies, traders, consumers and input

suppliers. Those specialized in farm management are

well placed to provide that support in addition to their

farm-level focus.

• pre-service

• induction

• in-service

• promotional training

90 The role of the farm management specialist in extension

Extension workers attending an in-class training session

Human development is a key function of extension workers.

Farm management specialists have a crucial role

to develop the business and management skills

of front-line extension workers so that they

can work more effectively with farmers.

Farmers attending a training class on material pertaining to their farms

Training and extension 91

The members of a learning group share ideas to strengthen decisions-making

Farmers being counselled by an extension worker

Developing farmer’s skills and competencies

should be the predominant goal

of farm management training and extension.

Training is essential to empower farmers

to make their own decisions.

92 The role of the farm management specialist in extension

CATEGORIES OF TRAINING

IN FARM MANAGEMENT

Pre-service training

Professional training received before extension

workers are appointed to the extension service.

As there are usually few professionals at

undergraduate or diploma levels, it is sometimes

necessary to employ graduates of secondary

vocational schools. Such graduates will not

have the breadth or depth of training obtainable

in college or university. As it is essential that

front-line extension workers are better trained

than farmers with whom they work, what may

be lacking in pre-service academic training must

be made up to the extent possible in induction

and in-service training.

Induction or oriented training

Providing a general understanding of the

organization and the role of extension workers

within it. All extension workers need special

training to prepare them for their particular jobs

and orient them toward what farm management

extension is, its principles, objectives and

methods of teaching and extension support.

Induction training should also develop an

attitude of personal dedication to the service

of farmers. This kind of training supplements

whatever preservice training the new personnel

may have had and gives it a context for the

extension worker’s new job.

Training and extension 93

In-service training

On-the-job training and scheduled training while

away from the job. On-the-job training can be ad

hoc or structured with planned learning outcomes

scheduled around the work of the trainees. Farm

management specialists are well positioned to

offer such training. (Trained extension workers

can conduct similar training for farmers.)

There are different forms of in-service training

including refresher courses, remedial training,

mini-training programmes, practical workshops,

study tours, seminars and eld trips.

Training for promotion

After serving for a period in the extension

service, many extension workers feel the need

for additional academic training to improve

performance in their present positions or to

qualify for promotion. Those extension workers

aspiring to become subject matter specialists

could take courses leading to graduate degrees

in farm management or marketing.

Note on ‘remedial training’

Remedial training is aimed at correcting or improving knowledge

and skills in a particular area – in this case farm management

and marketing. Such programmes assume that extension

workers on the programme would have been exposed to farm

management as a discipline during their formal education.

Remedial training is intended to complement their technical

skills with training in farm management. Remedial training could

be conducted as induction or in-service training programmes.

Training in farm

management, calls for

specialized knowledge

and skills

Trainees should

participate

in designing the

training programme

Training should be

experiential, based

on principle of

‘learning by doing’

94 The role of the farm management specialist in extension

An approach that is sometimes followed is for a

farm management specialist to train extension workers

who in turn train farmers in extension or learning groups.

In this way, the specialist is a Core Trainer supporting

front-line extension staff and subject matter specialists.

This approach develops an in-house training capacity for

future use.

Design of training programmes

Training in farm management, as does any technical

area, calls for specialized knowledge and skills. These

include communication and facilitation skills, and farm

management as well as practical skills in applying the

concepts and tools in rural areas.

As a starting point the farm management specialist

should be responsible for conducting a training needs

assessment. Once the training needs have been identied,

the next step is to design the training programme. The

specialist should lead this process and work with the

participants to design the training programme. Decisions

need to be taken regarding the objectives, learning

outcomes, content, teaching methods, assignments,

lesson plans, exercises and assessments. The programme

should include clear statements about the knowledge,

skills, attitudes and behaviours to be acquired. The

programme should also identify who will be conducting

the training in addition to the specialist.

Training should be as experiential as possible;

based on principle of ‘learning by doing’. In this approach

the participants are active in inuencing the training and

learning processes. The training needs to be practical and

the content demand-driven and tailor-made to the needs of

the trainees and the context within which they will operate.

The specialist should ensure a structured approach

to training. It should not be haphazard or arbitrary

but be based on an analysis of the existing skills and

competencies of the extension staff selected for training

and the design of training curriculum for use in the eld by

extension workers.

Training and extension 95

Module 1. The Farmer, the farm and decision-making

Session 1. The farm and its enterprises

Session 2. The farm and its resources

Session 3. Social capital

Session 4. Inputs and markets: where prots are made

Session 5. The farmer and decision-making

Session 6. Resources and farm management

Session 7. Decisions about inputs and markets

Session 8. Risk, vulnerability and sustainability

Session 9. Information and farm management

Example of a training programme

Module 2. Farm Management Tool Box

Session 1. Constraints and opportunities analysis

Session 2. Gross margin budgets

Session 3. Market margins

Session 4. Break-even

Session 5. Sensitivity analysis

Session 6. Food requirement

Session 7. Labour analysis

Session 8. Cash ow

Session 9: Records

Module 3. The Farm Plan

Session 1. The planning process

Session 2. Farm performance analysis

Session 3. Planning for the market

Session 4. The farm plan

96 The role of the farm management specialist in extension

The training programme for both extension workers

and farmers could ultimately aim at preparing farm

business plans. The content of the training should include

topics that allow the business plans to be prepared.

Graduation from training programmes should be

formalized with certicates given to those who adequately

complete the programme. Certication should conrm a

basic level of professional competency. This is often an

important incentive for the trainees. However, the success

of training programmes rests not in the certicates,

but in the impact the participant has in the eld. Long-

term success also depends heavily on the selection of

motivated participants with the capacity and skills to train

others.

Training farmers in farm management should not

be provided as a single one-off activity. It should continue

throughout the development of the farm business. And

farmers should be encouraged to continue learning

on their own during and after formal programmes are

completed.

Some of the farm management specialists

themselves may also require support to build their own

capacity. Perhaps they are under-qualied staff or have

been unable to update their knowledge and skills. A

training programme for them could cover topics such

as the general role of the farm management specialist;

farm business management and marketing; their role in

developing extension programmes; effective techniques

for farm management extension; working relationships

with other staff members and how to analyse, interpret

and disseminate farm management information.

This guide could be used as a resource for such

training. As with the other training programmes, those for

the management specialist personnel must be structured.

It should not be haphazard or arbitrary. It should be based

on an analysis of their existing skills and competencies

and contextualized in the work they will perform in the

eld.

Training farmers

in farm management

should not

be provided as a single

one-off activity ...

... it should continue

throughout

the development of

the farm business

Training and extension

Senior managers and policy-makers have to

be made aware of the farm management training

programmes so that they are willing to provide the

resources and support to replicate and expand them to

reach a broad base of extension workers and farmers.

Such programmes often require considerable

nancial support and a need for programme managers

to lobby the relevant ministries responsible for budget

allocations. To facilitate this, programmes for senior

decision-makers in extension organizations to raise

awareness and advocate the training should be

developed.

‘GOOD PRACTICES’ IN TRAINING

Training programmes should be designed

on the basis of client demand

Close attention should be given to training

requests from farmers. However, farmers may

be unaware of their own training needs. By

demonstrating the nancial benets to be made

from the training, demand can be stimulated.

More advanced topics of business management

might be introduced as the capacities of the

trainees develop over time.

The content of training programmes

must be tailor–made

They should be relevant to situation and

requirements of the target recipients, their

level of literacy and ability to assimilate the

information provided.

98 The role of the farm management specialist in extension

Note

Facilitation skills of trainers need to be

enhanced. Competent local facilitators are

rarely available especially within public sector

agencies and more effort in this area is needed.

‘GOOD PRACTICES’ continued

Training design should explore innovative

ways of building local capacities

Counselling, learning by doing and success-

case replication should be considered ways of

promoting developing entrepreneurship skills.

Training of extension personnel and

farmers should be practical, continuous,

regular, participatory and closely

monitored

Priority should be given to short courses provided

in manageable doses with practical timing. The

programme should include assessment and

follow-up on application in the real world on

what has been learned.

Training should be cost-effective

and aimed at maximizing outreach

This can be achieved by utilizing local training

capacity, organizing farmers into extension

groups to reduce costs and identifying, training

and deploying potential trainers from among

extension staff and farmers

Training programmes

should ...

... explore innovative

ways to build local

capacity ...

... be practical,

continuous, regular,

participatory and

closely monitored ...

... be cost-effective and

aimed at maximizing

outreach

Training and extension

* * *

EXTENSION SUPPORT

The role of the farm management specialist in supporting

extension workers comprises many activities including

training extension workers, providing training and

extension material, providing relevant and updated

information, assisting in creating and organizing

extension/counselling/advising services, advocating

farmers groups and the farm business school concept

and assisting in their implementation and management.

BACK-UP SERVICES

Extension workers and farmers need to be

supported after they complete a formal training

programme. Front-line extension workers

similarly need to be backed up as they work

with farmers to ensure that they are correctly

applying the concepts and tools taught and are

able to respond to problems among farmers that

may arise.

Ideally, the support should be linked to the

training programme. This will enhance coherence

in training, reinforce learning and increase the

overall effectiveness of the training programme.

100 The role of the farm management specialist in extension

Ultimately, farm management specialists are

responsible to support extension workers by providing

information and advice on ways farmers, and other

stakeholders in the value chain, can increase their income

through better business management. The information

should help them to:

• select protable crops

and improved production techniques;

• improve marketing strategies

to increase sales, improve quality

of produce, and achieve better prices;

• reduce costs and losses.

Enterprise selection and production techniques

Information is needed regarding which enterprises generate

better prots and what are the most appropriate production

practices to use. To do this the farm management specialist

must know the products produced in their respective areas,

the demand for these products on a range of markets, the

systems of marketing and the systems of production.

THE FARM BUSINESS SCHOOL

This establishes ‘business schools’ within

villages. Farmers work in small groups,

studying farm management at their own pace.

The venue, time and duration are chosen

by the farmers to t into their workload in

alignment with their production activities –

minimizing disruptions to operations.

This system is being tested in different

countries. Experience suggests that, with a

minimum of specialized training, front-line

extension workers and lead farmers can follow

this curriculum helping participating farmers

to learn and apply basic farm management

practices to their farm businesses.

Training and extension 101

The farm management specialist should identify

protable enterprises and identify suitable markets.

Farmers need to know:

• how to grow new crops which may

offer good prots;

• the protability of growing these crops;

• where to buy seeds for new crops

and new varieties;

• techniques required for off-season production

and any of the additional costs that may occur;

• post-harvest handling, packaging

for new crops and value-adding possibilities;

• how much can be sold in the market.

The farm management specialist

needs to make sure that this information

is available to extension workers

before encouraging farmers to move into

new, possibly risky, business ventures.

Improve market strategies

From speaking to farmers, farm management specialists

should be in the position to learn what the main marketing

problems are and to identify solutions. They can help

farmers improve sales by providing back-up support to

front-line extension workers when organizing farmers

into producer groups. They can help improve access

to buyers and markets and help farmers identify which

products have expanding demand. Specialists should

analyse seasonal price changes and trends for products

and provide farmers with this information to support their

negotiations for better prices.

Reducing costs and losses

Farm management specialists also need to be aware of

the costs and returns of farm enterprises at farm-level

and along the marketing chain and of ways to reduce

these costs. With this knowledge, they can advise

extension workers in helping farmers to reduce costs

through such interventions as encouraging farmers to

share transport or buy inputs in bulk.

Farm management

specialists must be

like a ‘business doctor’

who examines each

‘patient’, diagnoses the

problems and prescribe

the right remedies

Broadening the scope of extension services

In addition to requiring marketing and business

management support, farmers increasingly require support

in other areas to strengthen their position in the value

chain. One such area is legal support particularly with

respect to contracts drawn up between producer groups

and traders, processors and retailers. Further, to improve

chances of success, farmers also need organizational and

management skills, such as problem-solving and conict-

resolution, that will help the groups operate independently.

Training of extension workers should therefore also include

these topics.

Farm management extension strategy and methods

Farm businesses are often diverse, varying quite markedly.

Even if the enterprises are very similar, the sources of

inputs, the selection of markets and the management

decisions of farmers can vary widely between one farm and

another. Farm management specialists must be capable of

doing more than pass on standard instructions and check

that these have been followed. Sometimes, they must

be like a ‘business doctor’ who examines each ‘patient’,

diagnoses the problems and prescribe the right remedies.

102

The role of the farm management specialist in extension

FARM MANAGEMENT SPECIALIST INPUT

CAN HELP FARMERS

• Decide whether or not to produce new products

and when to produce them.

• Decide whether or not to produce

existing products at different times of the year.

• Decide whether or not to store.

• Calculate realistic estimated gross margins

and prots.

• Prepare a production plan and a marketing plan.

The farm management

specialist works

with front-line

extension staff

as well as with lead

farmers to promote

good farm business

management practice

Over time,

the extension service

could reduce

its focus on direct

farmer support towards

building capacity

among farmer groups

to take on

an extension role

Training and extension

103

In other cases they must be facilitators helping the farmer

assess a situation and make his or her own decision about

it. They must therefore be more than simply transmitters of

information.

To do this, farm management specialists must

gather information from other farmers in the area by

enquiry and observation and develop a true picture of the

farm business and its problems and opportunities. With this

understanding of the situation, the extension worker will be

able to give practical and relevant recommendations.

The scarcity of suitably qualied farm management

staff and the need for specic tailor-made advice makes

the provision of one-on-one farm management support

unrealistic. In order to reach many farmers, the specialists

have to work through more general front-line extension

workers. It may also be necessary to organize farmers into

extension or learning groups.

Some extension services have introduced a new

position – the marketing extension worker. These are

front-line extension staff who specialize in marketing, but

also provide farmers and rural entrepreneurs with support

in farm management. Farm management specialists

have a role in directing and advising them. Alternatively,

some farmers have been identied as ‘lead farmers’ to

provide advice to other farmers in farm management and

marketing on a voluntary basis.

The idea of working with less qualied lead farmers

or extension workers can be easily justied and understood.

Farms are scattered throughout rural areas and travel to

some of these areas may be difcult and costly. Farmers

from within the local community, if properly trained are

more likely to be trusted, improving communication with

farmers.

The idea of training farmers in extension could

lead to transforming the nature of extension support to

farmers. Over time, the extension service could reduce

its focus on direct farmer support to a focus on building

104 The role of the farm management specialist in extension

capacity among farmers and group leaders to take on

this role. As such a programme advances and farmer

capacity develops, farmers can be deployed, expanding

the extension service and making it more cost effective.

This could be extended to engage other actors in the

value chain.

To make this possible extension workers and

farmers without specialized farm business management

expertise will need training so they will know what to look

for in the farm business, how to identify the important

factors which identify problems, opportunities and

appropriate lines of action. Specialists can train and

assist extension workers and farmers to better diagnose

the problems of the farm and propose relevant solutions.

When working in this mode, there will probably be

a need to adapt and simplify traditional farm management

concepts and tools. This provides a challenge for

specialists. They need to identify and design farm

management techniques that are less dependent on

data and rely on the skills and support of front-line staff.

Innovative techniques need to be developed that use

simple and basic data and are applied through simple

methods and practices. Specialists have a role to play in

all aspects of this including collecting data and generating

and disseminating information.

There are a number of ways to approach this,

depending on the capacity of the farmers and extension

workers. Some farmers may keep records and analyse

data on protability by themselves, while others may

require assistance. A number of options exist:

• Data can be collected and analyzed by the farmer

with the help of the extension worker.

• Data can be collected by the farmer and analyzed by

the extension worker.

• Data can be collected and analyzed by the extension

worker who then reports the results.

The objective is

to build capacity along

the value chain

to strengthen

the position of

smaller-scale farmers

entering

the market place

Training and extension

105

Whatever the approach, the dynamic should be

to move from training and building capacity towards

developing relationships among the stakeholders along

the value chain. This will redirect focus away from dealing

solely with individual farmers towards farmer groups and

other stakeholders along the value chain taking up the

work. The objective is building capacity along the value

chain to strengthen the position of smaller-scale farmers

entering the market place.

One way for farm management specialists to

support front-line extension workers in their day-to-

day work with farmers and farmer organizations is by

arranging study visits and establishing learning networks.

Visits to successful farmers can help create awareness of

‘good practices’. In some cases the ‘successful’ farmers

can help provide training or advice to farmer groups.

The future competitiveness of a farm depends

on the farmer’s ability to ‘learn’ from other farmers

and stakeholders. Building learning networks among

farmers facilitates this learning. Networking could range

from group purchases of inputs and equipment to joint

marketing initiatives. Based on information gathered,

feedback and the results of farmer interactions, the

strategies and operations of farmers may be revised.

Farm management specialists are in a good

position to promote learning networks. They could

encourage farmers to join the network and organize

learning activities and other events that create face-

to-face contact among network members for sharing

experiences and knowledge, and get to know each other

better to promote sustained learning.

* * *

Farm management

specialists have

an important task

of coaching

and mentoring

front-line extension

workers and farmers

True learning takes

place when learners

translate what has

been learnt into action

and make sustained

changes to their

thinking and behaviour

106 The role of the farm management specialist in extension

COACHING AND MENTORING

Beyond their training and advisory roles, farm

management specialists also have the important task

of coaching and mentoring front-line extension workers

and farmers. This involves providing support to extension

workers and farmers on a regular basis. Coaching

involves seeing how the skills and knowledge acquired

through formal training are applied and, hopefully,

extended.

This follow-up is an important task for farm

management specialists. It is about developing the

capacity of extension workers and farmers beyond

their current capacity – including knowledge, skills and

behaviour. Coaching and mentoring help ensure that the

capacity of extension workers and farmers is genuinely

developed and opportunities for growth are maximized.

While farm management training provides

extension workers and farmers with the tools to do

their job better, only so much can be learned through

training. True learning takes place when learners have

translated what has been learned into action in the ‘real

world’ and made a sustained change to their thinking and

behaviour. This is where specialist coaching is needed. It

moves performance to a higher level. The coach assists

extension workers and farmers who have been exposed

to farm business management concepts and tools, to

reect on their performance to help them implement their

learning and foster a posture of continuous learning.

Coaching has the benet of exibility. It can be

applied where it is not generally possible to take groups

of extension workers or farmers away for formal training.

It can also be used to address one-off needs as and

when they arise, and to guide longer-term development

of capacity. Extension workers and farmers can gain

Training and extension 107

practical and realistic help to achieve their full potential

and work on their areas of weakness – they can be

provided with targeted and practical assistance. It is both

cost effective and exible.

Training and coaching functions are complementary.

When coaching a front-line extension worker, specialists

in farm management may realize that the extension

worker does not have certain knowledge or skills needed

to provide effective support for farmers. At this point the

coaching would stop and further training organized.

Source: Thorpe, S. & Clifford, J. 2003

THE STAGES OF COACHING

Clarify the overall need for

and goals of the coaching programme

Agree on specic development needs

Formulate a detailed plan

for the coaching programme

Conduct a task or activity from the plan

Review activities and planning

for improved performance

Exiting from the coaching relationship

108 The role of the farm management specialist in extension

COUNSELLING

Business counselling is another task of farm management

specialists although it can only be applied in special

situations. Business counselling requires one-on-one

contact as well as close communication, trust and

condence. It can be applied to help extension workers

and farmers deal with specic problems that they face.

As mentioned before, in smallholder agriculture,

extension advice is channelled through front-line

extension workers. In larger-scale agriculture, the FMS

has direct client contact creating the opportunity to

develop a greater empathy with the farmer. Currently in

developing countries where small-scale farming is the

norm, the counselling function is rare. But as farmers

become more commercially minded and, in some cases

as the scale of farming grows, the potential for one-on-

one counselling is growing.

Farm management specialists could also provide

marketing and business counselling to rural entrepreneurs

and other businesses in product value chains. Counselling

should aim to assist these businesses to understand

the changing economy and develop new strategies for

dealing with these changes. Specialists do this by getting

to know the entrepreneurs and building a professional and

condential relationship with them to discuss important

and perhaps sensitive issues. Every business has

different needs, and counselling should respond to them

accordingly. Specialists should help rural entrepreneurs

question the way they look at things and the way they

behave and react to situations with a view to developing

more appropriate responses. However, given the size of

some of these ventures the opportunity to offer counselling

is also rare.

Training and extension 109

COUNSELLING, EXTENSION,

CONSULTING, MENTORING

Counseling

A process by which a counsellor uses skill

and knowledge to aid clients in identifying

their needs and courses of action. Clients

are supported to help themselves. The client

owns the issues and remains responsible for

the decisions made and their outcomes.

Extension

Engaging with clients in a practical learning

experience through the mutual sharing of

knowledge and experience. While clients

are helped to help themselves, the advisor

has more direct inuence in the decisions

taken. Decisions and their outcomes remain

with the client.

Consulting

A consultant does business by giving

professional help to clients needing their

specialist knowledge. Consulting assumes that

the consultant is signicantly more capable of

addressing issues than the client is.

Mentoring

Mentoring is the ongoing relationship

between an experienced counsellor and

a client. This relationship covers a diverse

range of topics as a business develops over

time. It often includes accompanying the

client through the decision-making process

and the application of decisions in practice.

Chapter 6

Communicating information

The success of specialists in farm management

depends to a large extent on their skills in

communicating information. The materials

presented here are intended to provide guidance

to specialists on the various ways to effectively

communicate their ndings of farm management

analyses to policy-makers, extension workers and

farmers.

The ndings

of farm investigations

analyses are of

value only if they are

shared and effectively

communicated

112 The role of the farm management specialist in extension

EFFECTIVE COMMUNICATION

Communicating farm management information to

policy-makers, extension workers and farmers must

be effective so that the ndings of farm management

investigations and diagnoses can be easily understood

and appropriate actions taken. People generally prefer to

receive information that is brief and clearly presented. It

is the job of the specialist to turn farm management data

into information that can be effectively communicated.

The method and choice of presentation depends on the

audience and their capacity and skills.

The ndings of farm investigations analyses

are of value only if they are shared and effectively

communicated. It is also not enough to identify solutions

to farm management problems. The solutions need to

be broadly communicated to policy-makers, extension

workers and farmers. Communication can be presented

in different forms — verbal, written or graphic. Whatever

form is used, information should be factual, backed up with

evidence and presented in simple and clear language;

methods used and data sources should be included.

This strengthens the credibility of the information.

Verbal presentations are valuable in communicating the

results of studies. Clients are sometimes reluctant to read

reports and are more open to listening to a presentation.

Face-to-face verbal communication encourages two-way

communication which is vital to good communication and

feedback. Verbal presentations followed by discussions

maximize the impact of the analyses.

Written reports tend to be more trusted than verbal

communication as they usually provide more details

than verbal reports can. They also offer ‘evidence’ of

what was communicated thus reducing the chance of

misunderstandings and allow for repeated study. Written

Communicating information 113

reports such as area proles and compendiums are also

important forms of reference material. Where possible,

pictures and other graphics should be included.

Graphics such as pie charts, bar graphs, diagrams,

photographs and drawings often make the results of

farm management analyses more easily understood.

Care should be taken when selecting graphics as some

people may have difculty interpreting them. Graphics

should be used only when there is condence that it can

enhance a presentation.

In practice all three forms of communication

are most often used together.

Farm management specialists must possess

the skills to balance this effectively.

* * *

COMMUNICATION FOR EXTENSION

Extension workers use different methods to communicate

with policy-makers, other extension workers and farmers.

These can be divided into three forms – mass media,

direct interpersonal communication and Information and

Communication Technology (ICT).

Mass Media

Mass media refers to communication systems which

expose large numbers of people to the same information

at the same time. The advantage of mass media to

disseminate information is the high speed and low cost

of communicating over a wide area. Being relatively

inexpensive, mass media allows extension services to

provide a basic service to many farmers at the same

time. The main disadvantage is that it is generally a one-

way communication.

114 The role of the farm management specialist in extension

Mass media has been used effectively to convey

market information including prices, quantities purchased in

particular markets, and market advice on quality and safety

standards. It also has potential to convey farm management

information – although this is less frequently used.

Forms of mass media

There are three main forms of mass media: sound,

moving pictures and print. Sound includes radio, audio

cassettes and CDs. Moving pictures includes television,

lm, video, CD, and DVD. Print includes materials such

as posters, newspapers and leaets.

Radio. This is a very powerful way to reach large

numbers. Farmers in remote areas are less isolated if

they have a radio. ‘Listening groups’ and systems for

sharing radios between farmers are particularly useful

where the cost of owning a radio is high.

The cost of producing and transmitting radio

programmes is usually high, but when looked at on a

per listener basis, radio is denitely more cost-effective

than direct extension interaction with farmers. Producing

extension material for radio broadcasts is part of the

function of the farm management specialist.

Radio broadcasts can also be used for

training purposes. However, as radio is a one-way

communication, the content would have to be the same

for everyone whatever their level of understanding and

or farm circumstances.

A new innovation for radio is ‘reality radio’ where

farmers are included in the programmes to share their

successes and challenges with other listeners. Extension

messages combined with reality radio programming can

be a power tool for extension.

Printed media. With this media words and graphics

are combined to present information. The advantage of

printed media is that they can be looked at for as long

Communicating information 115

as the viewer wishes, and can be referred to repeatedly.

This makes printed media ideal as permanent reminders

of extension messages. They are especially useful

for broad areas of common concern to farmers. They

are particularly useful in areas where a reasonable

proportion of the population can read, but, if cleverly

put together, can also be effective in areas with low

literacy rates. Printed media used in farm management

extension include posters and leaets, compendiums,

and handbooks, among others.

Postersandleaets. Posters are useful for reinforcing

messages that farmers receive through the other forms of

media. They are usually displayed in places where large

numbers of people regularly pass by. The most effective

posters carry a simple message, catch people’s attention

and are easy to interpret. Leaets are used to summarize

the main points of messages or provide information that

is not easily remembered simply by hearing it. Examples

are sources of inputs, lists of buyers, terms of lending,

market prices and brief explanations of various farm

management tools.

Compendiums. A compendium is a specically compiled

collection of information such as area proles. These

are reference sheets that could be used by planners,

extension workers and policy analysts.

Farm management handbooks. Farm management

handbooks are written publications issued periodically

(e.g. annually) presenting the ndings of related

investigations. The handbooks are often based on the

ndings of farm business surveys that typically consist

of gross margin data for specic crops and livestock

enterprises under different farm sizes, dates of planting

and levels of farm performance.

This information is of value for extension workers,

farmers and policy-makers. Published enterprise budgets

are used by policy-makers to assess credit requirements

of government programmes.

116 The role of the farm management specialist in extension

The handbooks are also used as an extension

tool by front-line extension workers. The data on

enterprise prots are used as benchmarks to compare

the protability of farm enterprises against benchmark

standards for different categories of farms as given in

the handbook.

USE OF MASS MEDIA

Cost effectiveness

makes mass media excellent for:

• Spreading awareness of new ideas and creating

interest in farming innovations and new enterprises

or products. Radio is one of the best media reaching

large numbers of people and to publicize extension

activities.

• Giving timely information about market prices, input

costs and market outlets and sources of inputs.

• Multiplying the impact of the results of farm

management investigations by reporting them in

newspapers and on the radio.

• Sharing success stories of farmers to stimulate

similar action among other farmers or producer

groups. Farmers are also often interested in hearing

about the problems of other farmers and how they

have overcome them. Community stories can also

be shared in this way.

• Answering questions and advising on problems

common to a large number of farmers.

• Reinforcing or repeating information and advice.

Information heard at a meeting or passed on by an

extension agent can soon be forgotten. It will be

remembered more easily if reinforced by mass media.

It is through direct

personal contact that

tailor-made advice is

conveyed to farmers

and practical skills

are taught

Communicating information

117

Direct interpersonal communication

While mass media has considerable potential to convey

farm management messages widely, it cannot substitute

for the main tasks of an extension worker. It is through

direct personal contact that tailor-made advice is

conveyed to farmers and practical skills are taught. It is

in this personal contact that genuine learning is fostered.

And it is through personal contact that extension

messages can be conveyed to policy-makers.

Communication with farmers. While interpersonal

direct communication is more costly than mass media,

it has the greatest impact. Group extension is one way

to reduce costs and yet maintain the quality of the

communication message and interaction. The group

method is more cost-effective than extension work with

individual farmers – offering the possibility of greater

extension coverage. Group-based extension, however,

requires the active participation of farmers in order to

be effective. The group method has become even more

relevant as specialists and front-line extension workers

extend their work to different actors along value chains.

Farm management specialists do not organize

farmer groups; this is the role of the front-line extension

worker. But they do support extension in this and in

developing extension workers’ capacity to extend farm

management and marketing advice to farmers.

ADVANTAGES OF GROUP EXTENSION

• Greater coverage and cost-effectiveness.

• More effective learning environment through

interactions, mutual reinforcement, group pressure.

• Greater focus for joint action of group activities.

• Bring together farmers with similar problems.

• Encourages group action in areas like marketing

and buying inputs.

The farm management

specialist is well

positioned to bridge

the gap between

policy-makers

and extension workers

and farmers

118 The role of the farm management specialist in extension

COMMUNICATION WITH POLICY-MAKERS

Policy-makers, just like farmers, need relevant information

to make decisions. Timely and effective communication

through a well-planned strategy will create awareness,

improve knowledge and induce long-term changes in the

perception, mindset and decisions of policy-makers. Farm

management specialists are well positioned to do this and

to bridge the gap between policy-makers and extension

workers and farmers.

In advocacy roles, specialists should have the skills

to help raise the awareness of policy and decision-makers

of the importance of farm management and marketing and

the usefulness and relevance of farm-level data. It is also

important to communicate to policy-makers the need for

better coordination of policies between decision-makers

and the people (especially farmers) affected by them.

A dilemma facing farm management specialists

and other technical staff is how to effectively communicate

the results of farm investigations to senior management

and policy-makers. Policy change requires close

communication between specialists and policy-makers.

Policy workshops can facilitate this. Depending on the

purpose of the workshop the workshops should be

attended by different combinations of stakeholders,

including farmers, extension workers and researchers

and private sector business owners and entrepreneurs.

The workshops would provide a platform to conduct

an advocacy campaign with Government on policies

and strategies that impact negatively on the business

environment for farming.

In preparation for the workshops, specialists should

prepare and disseminate to all participants briefs on farm

management-related topics that are likely to impact and

affect the situation of farmers in the eld.

Communicating information 119

By including farmers in these workshops they

can inuence the policy-making process and contribute

to ensuring that policies are relevant. Farmers should,

as a matter of principle, be part of the communications

strategy. They can serve as advocates and lobby and

inuence policy-makers to bring about changes that

support their interests and needs. Ultimately, policy

change requires trust that can only be established once a

long and stable relationship between farmers and policy-

makers can be secured.

* * *

INFORMATION

AND COMMUNICATION TECHNOLOGY

Rapid changes are taking place in the use of Information

Technology (IT) to support extension. The development

of the personal computer (PC), together with that of the

Internet, has great potential. IT is tremendously powerful

and needs to be harnessed by extension organizations

for the benet of farmers. Information and Communication

Technology (ICT) also has an important role to play in

informing farmers about management and marketing

issues and has the potential to erase physical barriers.

ICT provides a dual communication system where

interaction can occur between the sender and receiver of

information. It includes basic systems like the telephone

to more sophisticated devices such as the mobile phone

and PCs that offer multimedia services such as television,

radio and telephone. These are potentially powerful tools

for farm management specialists.

120 The role of the farm management specialist in extension

An extension ofcer presenting results of a farm management exercise

Extension worker explaining farm planning to a group of farmers

Effective communication is a two-way ow of information

that requires close interaction

between extension worker and farmer.

Communicating information 121

Communication occurs through three main forms:

mass media, direct interpersonal communication,

and Information and Communication Technology (ITC).

Farm management specialists and front-line extension workers

have to develop these skills to communicate in these varied ways.

Farmers watching training materials on video

Editing a video for training purposes Disseminating information by radio

Access to ICT gives

signicant advantage

to farm businesses,

so long as farmers

and extension workers

possess the skills

to use it effectively

Farmers can also

use ICT to share

information among

themselves and

to make contacts

along the value chain,

including

export markets

122 The role of the farm management specialist in extension

ICT has great potential to increase the outreach

and impact of extension services and to distribute

information to multiple stakeholders in the agricultural

sector. ICT can greatly improve access to information

urgently needed by all stakeholders in the value chain.

Further, ICT can provide a means of communication

between all interested parties about matters related to

agriculture in general and farm management in particular.

Importantly, farmers have the opportunity to do the

same. Two-way communication is critically important in

extension work as farmers often require regular support in

their production and marketing operations. Farmers can

also use ICT to share information among themselves and

to make contacts along the value chain, including export

markets.

ICT facilitates access to information from many

sources anywhere in the world. This in turn facilitates

data collection and the preparation of area compendiums

and proles. With appropriate planning and programming

assistance, specialists can create ‘knowledge networks’.

These are groups of people, who are geographically

separated, but who communicate regularly and share

knowledge about matters of interest. Over time, this

information can be stored and made available to all

interested parties via websites and databases

HOW FARM MANAGEMENT SPECIALISTS

CAN USE INFORMATION

AND COMMUNICATION TECHNOLOGY

• Provide information to small-scale farmers

regarding input and market prices.

• Retrieve information from farmers on yields,

costs of production and market prices attained.

• Disseminate farm management and marketing

information over distances, at lower costs

and in visual, written and audio form.

The value of taking

full advantage of ICT

cannot be overlooked

by the well informed

farm management

specialist

Communicating information

123

Using ICT, farm management specialists can more

easily maintain contact with front-line extension workers

and other organizations working in a local area. There is

also great potential to train extension workers and keep

them updated on the latest information. In turn, extension

workers can train farmers to use ICT thus widening two-

way access. Specialists can support these programmes

and monitor and evaluate them.

Finally, using ICT, specialists can be in regular

contact with various levels of administration at local

and national level. This can help in sharing important

information between the various administrations and

specialists. It is a good starting-point for championing

possible projects required for an area.

Incorporating ICT into existing information services

requires careful planning, training and a long-term

perspective. ICT needs strong linkages between national

and regional or state and local organizations responsible for

extension, as well as the involvement of credible individuals

at national, regional and local levels that act as intermediaries

or facilitators. For example, a facilitator at local level needs

to be knowledgeable about ICT, have the capability and

support to maintain the local ICT system, provide training

in using ICT devices and, most importantly, be credible and

trustworthy to the local people.

LINKING LOCAL LEARNERS

The Rural Knowledge Network supported by

IFAD and FAO is an example of public and private

partnerships establishing market information

ows in which small-scale, local market-oriented

enterprises collect and disseminate market

information through the use of mobile phones

and PCs with internet connection.

(http://www.linkinglearners.net/)

124 The role of the farm management specialist in extension

The potential for the use of ICT is great, but it

needs to be harnessed in the most appropriate manner.

It must be used with relevance to farmers’ needs. ICT

has to be considered in the wider spectrum of the role of

farm management specialization and fully integrated into

this role.

However, ICT requires considerable support for

its diffusion within a national context to become fully

effective. This rests in the hands of policy-level decision-

makers. There must be a national policy that grants

access by all to telecommunications and provides a

supportive regulatory environment. Only when ICT is

universally accessible and affordable can it be of use to

extension services and farmers.

* * *

PRESENTATION OF RESULTS

The attention given to presentation and dissemination of

results is often inadequate. In preparing presentations,

farm management specialists should know:

• to whom the information will be presented;

• the level of decision-making;

• at what time and with what frequency

information is required;

• in what form results should be presented.

The relevance of the studies will be enhanced

if the results are practical and can be easily translated

into action. Recommendations might be divided into

immediate and longer-term priorities. As decision-

Communicating information 125

makers are concerned about net costs, presentation

should include the budgetary implications in the context

of the benets to be realised.

Different users require different levels of detail and

forms of presentation. As one moves along the decision-

making structure from eld-level worker to technocrat

to policy-makers, the information presented needs to

be briefer, less demanding in technical knowledge and

more oriented to presenting conclusions and options for

decisions. Farmers and extension workers need detail;

policy-makers need broader information.

Timeliness is the key to successful information

transmission. Careful consideration should be given

to when the information should be shared. It is useful

for information to be linked to the farmers’ production

programmes. Information also needs to be ‘fresh’;

particularly price and other market information.

Effective use of the results of analysis can be

improved through giving more attention to the preparation

of presentation material bearing in mind the various ways

in which information can be transmitted, as discussed

earlier.

Using computers, spreadsheets and electronic

presentation applications, analysed data can easily be

presented visually in an attractive format rather than

simply gures in a table. This improves the chances of

attracting the interest and attention of the audience.

Accuracy of data is important. Before a report

is nalized, stakeholders should have the opportunity

to review a draft report to make sure the report does

not omit or misrepresent important points of view.

This can be achieved through eld presentations

and workshops and through circulating draft ndings

and reports for comment. This will help cross-check

ndings, generate new insights, communicate results

and help different stakeholders understand varying

opinions and views.

127