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Agribusiness management skills for agricultural smallholders in Africa


par Mohamed Ali Trabelsi
Technical University of Munich - Master of science Agrarmanagement 2020
  

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4.1 Cause and effect analysis

ICHIKAWA, or 8M, is a causal diagram permitting to show the potential causes of a specific effect. This is the ishikawa diagram figure 8 applied in our case of study:

Figure 6 Cause and effect Analysis for the farm

To discuss each component of it separately. Starting with Man framework:

Man: The unavailability of trained or experienced labors during harvesting time can delay the cultivation activities, which will directly affect the crop yield. So, the trained workforce is of high importance to ensure a good application of the GAPs and then a good performance.

Machine: it's paramount to choose the right planting and harvesting equipment due to the varieties' sensitivity to mechanical harvesting. Moreover, irrigation is crucial in most of the regions concerned, the innovation artisanal pivot has a significant effect on the water-saving and the use of regular quantity of water in the correct moment avoiding the waste.

Material: the choice of adapted varieties and good quality seeds, both resistant and healthy, is essential to obtain a profitable crop and less susceptible to diseases and insects. Besides, the plant's superficial root system requires appropriate fertilization to accelerate its growth and shorten its development cycle. Moreover, the application of pesticides in the correct time is of high importance to reduce the spread of diseases and pests in the field.

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Medium: on the way to increase soil fertility and avoid yield loss due to water quality, it's highly recommended to introduce carefully fertilizers and change the plots.

Method: Great importance should be attached to good choice of the plot, soil preparation, sowing, quantity of planting and drip Irrigation to improve crop establishment and water use efficiency. They reduce irrigation costs and increase the profitability of the crop. To ensure a good yield, there is always recourse to crop rotation and reduce growing crop in monoculture.

Financial means: such as own capital, loans and agricultural insurance are of great importance for the availability of cash at the beginning of the campaign. This can help the smallholder to better invest and manage his expenses concerning the purchase of inputs, fertilizers and the payment of labor. Having an account in the bank for savings, allows the farmer to record the flow of money, the payment of certain bills by checks and better management of his components.

Management: the lack of planning and strategy setting prior to the campaign can cause several risks to the success of the campaign or production. Therefore, joining a professional organization to help farmers group to negotiate the prices of inputs and to sales group in order to ensure a good selling price and facilitate market access. For the quality of production, it is necessary to select the suppliers and buy only fertilizers and certified seeds. In addition, making the right investment decisions and considering the rate of return, payback time and their effect on production and sustainability are crucial. In the current case, the investment in the artisanal pivot can reduce the irrigation costs and make it more precise and efficient. To finish this component, it's necessary to know the state regulations to properly manage the harvest and the storage.

Market: More Market knowledge is needed to derive maximum of benefit. The tubers could be stored until prices improve and then sold when prices are high and not too many potatoes are available in the market. Moreover, to ensure the best price for the potato, the sell should be organized with a farmer group, which has contracts with potato buyers in order to sell the production at a good price.

After the analysis of all the competences necessary for small farmers, these skills can be classified in 3 groups: technical, managerial and economic as shown in the following diagram, Moreover, some interdependence between these skills can be deduced.

Improved
production
techniques

Economic Skills

Management

Agribusiess
Management Skills

improvements

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Land clearing and preparation;

 
 

Disease and Pest Control

 

Harvesting, Storage

 
 

professional
agricultural
organization

 

Investment decision

 
 

Potato cropping
Calender

 
 
 
 
 
 
 
 
 
 
 

Choosing the good plot

Sourcing healthy
seed, resistent
varieties

Harvest Potato
carefully

Obtaining market
information and
planning sales

Mini-pivot
Investment

Sourcing of inputs,
Managing Money
Daily

 
 
 
 
 
 
 
 
 
 

Planting in a circle,
knowledge the
growth cycle

No Potato grown last year

Separating damaged
and undamaged
tubers

identify potato
buyers before
planting.

Establishing
irrigation

Short medium long term planning

 
 
 
 
 
 
 
 
 

Dosage Planting
densities and
certified seeds

Safe use of
Pesticides

Good storage to
maintain good
quality

prices, quality,
quantity
requirements

efficient

irrigation, save
water

record Money-in & Money out

 
 
 
 
 
 
 
 
 
 

Properly Fertilizer
application

Monitoring and
control

Selling potato when price are high, group

sell

saving money in
Bank

Calculation of the
unit cost

 
 
 
 
 
 
 
 
 
 

Crop rotation:
Potato with onion
and Peanut

Financial
Management

 
 

Figure 7 Classification of Agribusiness Management Skills

Source: GIZ/ FBS Potato. 2020

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As shown in the diagram 7, improved production techniques cover the right crop rotation (potato then groundnut, and the following year onion) which not only reduces pest problems, diseases and weeds, but also enriches the biodiversity and soil fertilely. Moreover, to ensure a good yield, it's required to make a correct dosage between the planting densities from certified seed and apply properly the fertilizers. With this improved production, the farmer can greatly increase his production yield.

For the second component, managerial skills, a good adjustment of land resources and especially labor can reduce costs and maximize profit. Moreover, the better planning of farming activities can also save money to cover necessary expenses during the campaign and then avoid expensive last-minute credits. These savings at the bank also allow the farmer to apply for loans. Added to this, membership in the professional agricultural organization allows the smallholders to obtain better prices from suppliers on the sake of reducing costs, obtaining a better selling price and good quality products. Hence, to succeed and finalize a medium-term investment like, in our case the irrigation pivot, it's crucial to follow the financial recommendations to plan it properly and decide whether it is an investment with savings or project financing.

Concerning, the economic skills, the calculation of production costs assist Smallholders to plan its expenses for the next season for the purchase of fertilizers, seeds, payment of labor, services etc. We noticed that there is interrelationship between the economic and technical aspects of production. The calculation of the unit costs and comparing it with the market price helps in the decision either to abandon or to adapt better production techniques in order to make profits. By calculating the gross margin and using the financial calendar, farmers can make an effective decision on the profitability of a given investment and short, medium- or long-term planning. Thus, we notice also an Interrelation between economic skills and management improvement.

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