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Managing for impact: learning from successes and failures

Posted by Roxanna Samii Thursday, November 17, 2011

The East and Southern Africa (ESA) annual workshop focusing on managing for impact kicked off on 14 November in Arusha, Tanzania. The event brings together 200 participants from 17 countries. 

This is a special event on many fronts. To start with, the participants warmly welcomed colleagues from South Sudan. Secondly, they bid farewell to Ides de Willebois, who is moving on to lead the West and Central Africa division.  And last but not least, this is a unique event because for the first time, participants have embraced moving away their from traditional way of doing workshops and have embraced knowledge sharing methods.

Ides de Willebois in his opening remarks reiterated the fact this is a learning and sharing event. “Without learning and sharing we cannot improve and we cannot have impact”. He also went on to say that “we need to have a better understanding of what we do, so that we can do it better.”
In concluding his remarks, de Willebois mentioned that he is planning to start an exchange visit between East and Southern Africa and West and Central Africa. “I hope that West and Central Africa colleagues will join next year’s annual event, so that they can learn from your experience”. 

Breaking the mould
Whenever you decide to innovate or break away from business as usual, there is some apprehension. You feel gratified when breaking the mould ends up being successful and resonates with the expectations. And this is exactly what happened at the ESA event.

It was so refreshing to see 200+ participants embrace knowledge sharing methods such as openspace, spectogramme and world cafe type discussions. Thanks to these participatory methods, they started to mingle, bond and in no time they got to know each other.  

In the process, they heard many stories, including one about how ESA implementation workshops evolved from a being top-down loan administration events to more learning events owned and organized by the projects.

The majestic mount Kilimanjaro and the Kalali women dairy cooperative
As a child, when school was  over, I would be counting the days so that I could join my grandmother in Mount Damavand. Damavand is Persia’s tallest mountain in the Alborz mountain range. Grandma had these wonderful stories about mount Everest, the far way mount Fuji and then a majestic mountain in Africa - mount Kilimanjaro. 

I was intrigued by mount Kilimanjaro, because as a I child I found it difficult to fathom that Africa had mountains. So, on Monday when we had to sign-up for the field trips, I could not believe that finally I would be able to see this far far away mountain.

Unfortunately the majestic mount Kilimanjaro decided to remain pretty veiled and the clouds did not cooperate. But nonetheless, seeing it was an emotional moment and brought back many fond childhood memories.

We then moved on to visit the Kalali women dairy cooperative. This cooperative is part of the Agricultural Sector Development Programme where IFAD is investing loan funds in supplementing financing to the nationwide development programme, to counteract the depletion of the initial funds committed by development partners as part of a basket fund arrangement.

The cooperative is located in Machame division, Hai district in Kilimanjaro region. Inspired by a local daily community business, this cooperative was established with 132 members in 1988. The cooperative’s goal is to:
  • increase income of poor rural households, particularly women in the area through a number of different income generating activities
  • improve lives of orphans and provide assistance to poor families who were unable to provide education and sound nutrition for their children
“To get going the cooperative members contributed 1000 shillings each and payed a membership fee of 50 shillings,” explained Nancy Manasseh Kidin, the cooperative’s chairperson.

Considering their scarce income, these monies were paid in 4 installments. The cooperative started with 8 dairy cows. In 1995 they had 41 dairy cows.

Considering the vital role women play in rural societies, the cooperative decided that women headed-households were the ones to receive the cows.  They agreed that the person who receives the cow for a period of seven months would:
  • give one litre of milk a day to the orphanage
  • give the calves to other women headed-household and members of the cooperative 
As a result in a short time, 24 women who had signed up to this deal managed to provide dairy cows to 117 cooperative members.

Today the cooperative has a total of 260 members.

Diversifying activities
These industrious women used their income to diversify their business. In the 90s they bought themselves a milling machine.

“We provided milling service in the local market and expanded our business by buying a container to store the maize”, said Kidin.

“We also used the profits from the milling business to buy seeds.”

In 1993, they went one step further and bought themselves an electric machine and donated their diesel operated milling machine to another women group.

With the profit from their milling business they bought feed for the cows.

A terrible blow
They had a flourishing business, produced milk in abundance and sold this to a company in Arusha, thinking that a company is a reliable partner.

“We failed to ask for the money upfront and the company failed to pay us 12,000,000 schillings”, said Kidin.

This was a terrible blow for them. The community lost confidence in cooperatives and felt let down.
This mishap taught the cooperative an important lesson: never accept an “IOU”, always finish a transaction, sell, get your money and go on.

Despite this set back, they managed to back on their feet, thanks to the generous contribution of Italians.

A new door opens: dairy processing 
The Italians provided them processing instruments and that is how they started making butter and cheese.

Today they produce:
  • 400-800 litres of milk a day
  • 10-20kg of cheese per day
  • 50-95 packs of butter per week
  • 400-600 packs of yogurt per week
They keep track of their daily production and make some impressive graphs without using Excel. They also have a sophisticated booking keeping practice.

They package their products and have a registered trademark. “We sell the dairy products at Moshi, to grocery stores, to hotels and send our cheese and butter all the way to Zanzibar”, explains a proud Kidin.

The cooperative has the necessary certification to package its product, however, they are faced with the challenge of not having adequate technical support. This means they are unable to take their business to the next step and benefit from industry’s best practice.

One thing that we observed was the BEST BEFORE DATE on their products. Without exception their products seem to have a shelf life of one year!!!!

Kidin shared with us that the cooperative aspires to be able to:
  • procure large 50 litre metal containers to store the milk instead of using plastic containers
  • avail themselves of technical expertise and training so that their products are of high quality meet regional standards, have bar codes and can compete with Kenyan products
  • have access to veterinary service
  • have access to East African Community Market and get packaging machinery 
  • have all the women of the community become members of the cooperative
  • become a renown cooperative both inside and outside Tanzania
In conducting their business, the cooperative has learnt the importance of:
  • providing thorough and in depth training to the machine operators, so that they do not only know how to operate the machine, but also maintain it properly
  • understanding the market demand and their potential competitors
  • doing a good market search before buying equipment and better understanding what is needed and how a piece of equipment can help them 
Expanding the business and facing new challenges
With a relatively good income from their dairy business, the cooperative bought a sunflower oil pressing machine and started a savings credit cooperative (SACCOS).

The SACCOS has 375 members and started with a capital of 3.2million schillings.

The older women of the community put their savings in the SACCOS and the more business oriented women use the SACCOS to get a loan. The loans have an interest rate of 3%.

Kidin shares with us that the SACCOS are faced with two challenges:
  • underpayment
  • corruption
This has led to a loss of 22 million schillings.  This loss made the community understand the importance of choosing right people as SACCOS board members. They now know that a board member:
  • needs to be a trusted member of the community
  • one who understands the ins and outs of the business and entire process
  • one who has knowledge of financial management so that they can play a supervisory role, detect collusion and immediately take corrective actions
Investing in health and eduction of young people
The community is committed to provide education for the children and young people - especially to orphaned children and those from less advantaged families.

They use their profits to send children from disadvantaged families to school and are also assisted by Italians who are sponsoring a number of children and putting them through school.

Their vision is that every child has to go to school.
Their sustained programme of investing in education of their children is one of their great successes. Thanks to this initiative many young people have successfully finished school, obtained their degree and now serve as accountants, agriculture specialists, engineers and health workers.

Many have heard of WFP’s school feeding programme. Well, the Kalali women dairy cooperative runs a similar programme - they support school feeding by providing one glass of milk per class. 

The cooperative challenges
Kidin shared with us the cooperative challenges: 
  • continuous power cuts which lasts days
  • lack of access to adequate and state of the art machinery for packaging and conservation so that they are able to compete in the  market
  • lack of access to technical expertise to take the business to its next level
  • lack of local talents and expertise
  • lack of access to appropriate equipment for conservation
  • high taxation and cumbersome regulations
  • competition with Kenyan products
The cooperatives aspirations
Kidin and the cooperative members aspire to:
  • have all women in the area become members of the cooperative
  • give dividends to all the members and not just provide contributions in kind
  • create more employment opportunities
  • send all children to school
  • expand the sunflower pressing business
  • innovate and continuously provide new services to the community
  • provide capacity building
  • build technical and leadership skills and groom local talents
  • set up a milk bar so that community members understand that there are other options to drinking alcohol
  • do more follow-ups and have a better feel what you can realistically achieve 
  • develop robust business plans
We cannot but wish this group of hardworking and resilient women the best of luck. They are a great example of how when a community takes development in their hands, despite set back, they are able to move on and bring about change. I am sure the Kalali women dairy cooperative will go from success to success and manage to fulfill all their aspirations and be a model for many more women.