Feed the Future
This project is part of the U.S. Government's global hunger and food security initiative.

4.2.7. Recommended Good Practices for Vulnerable Populations

Pre-Value Chain Selection

  • Conduct initial situational assessment. Successfully incorporating vulnerable groups into value chain programming requires an understanding of their skills, risk tolerance and barriers to participation. Practitioners are finding that broad situational assessments (e.g., Household Economy Analysis and Cross-Sectoral Youth Assessments) yield invaluable information for program design. Given the heterogeneity of vulnerable groups and their varying capacity to engage in new opportunities, these assessments should analyze individual or household livelihood patterns and distributional patterns within groups, so as to determine what strategies are most appropriate to the level of vulnerability and what complementary interventions are required to address significant constraints. The experience of several practitioner organizations suggests that these assessments are best performed prior to performing value chain selection and value chain analysis, so that these activities are tailored to the capacities and vulnerabilities of the target population.

Value Chain Selection

  • Expanded criteria. It is critical to select value chain criteria that will facilitate inclusion of vulnerable populations. While the standard criteria are important to include (competitiveness potential, impact potential, cross-cutting issues, and industry leadership), the selection process also needs to consider the constraints faced by the target population. Otherwise there is a risk of missing barriers to their participation, or value chains in which they are indirectly involved. Additional lenses for value chain selection include:
  1. Opportunities for employment. Employment offers a lower risk path to benefiting from growing value chains. The interest in self-employment is regularly over-estimated; often the very vulnerable turn to the informal sector given the lack of attractive alternatives.
  2. Minimal potential for harm. Economic opportunities that require long journeys away from home or entry into the public sphere have the potential for significant harm (see text box below). Value chains should be selected in which these threats are minimal or can be mitigated.
  3. Low barriers to entry. Value chains with onerous entry or upgrading requirements are usually inappropriate given limited financial and human capacity.
Multinational and NGO in Ethiopia

One seemingly promising private public partnership between an international agency and an American lead firm created new employment for adolescents as operators of mobile carts selling soft drink. However, the project was abruptly ended after field workers discovered the young adolescent girls attracted much greater attention from older men after being brought into the public sphere. This change created extremely detrimental health impacts, as the level of HIV among the female cart operators jumped dramatically.

  • Consider cross-cutting or bundles of value chains. Working with the vulnerable as producers of goods or services is often not an appropriate entry point, given high barriers to entry (e.g., the need to establish vertical linkages, achieve a minimal scale of production, have entrepreneurial ability, invest in equipment and infrastructure) and the accompanying risks of market fluctuations. Supporting the vulnerable as consumers to improve their access to products and services that cut across multiple value chains (e.g. irrigation, transport, inputs) are often of greater utility, as many do not produce a surplus or cannot meet the needs of demanding buyers. This strategy also supports diversification—a common risk mitigation strategy among the vulnerable—by not tying the vulnerable into a single value chain. Rather, they can apply gains (e.g., cheaper or more accessible transportation services) across a range of domestic and market-oriented activities. Promoting multiple value chains is another strategy to support diversification that reflects the livelihood strategies of the vulnerable.

Value Chain Analysis

  • Broaden skill sets. Effectively analyzing the incentives and constraints to upgrading faced by vulnerable populations typically requires the inclusion of additional expertise in the research team. It is critical to ensure the the strong participation of stakeholders knowledgeable about the vulnerable populations to be reached through a value chain project, and of representatives of those populations during the value chain analysis process.

Competitiveness Strategy

  • Adjust project expectations. Project results are often slower than with non-vulnerable populations given the greater number of constraints that are typically present, particularly at the beginning of a project when trust is weak and risk tolerance is low. Project targets should be adjusted accordingly to reflect this.
  • Understand (dis)incentives. Risk aversion, social pressure, lack of confidence, food insecurity, illnesses (e.g., HIV) and other factors shape the incentives and capacity of vulnerable groups. These incentives are often quite different from those of their less-vulnerable peers. Understanding the range of non-economic incentives and disincentives to participation and upgrading is important to determine if and how vulnerable groups will engage with value chain programming.

Design and Implementation

  • Transitioning from immediate needs. Growth in assets and income is not typically a priority for the most vulnerable. Protecting household assets and smoothing income flows and consumption patterns may be of greater immediate importance. Working with vulnerable populations often requires support to address immediate needs while simultaneously developing longer-term livelihood strategies.
  • Build assets, not over-indebtedness. External finance is a commonly-promoted source of capital for firms to invest in upgrading, particularly from microfinance institutions. For the vulnerable, however, indebtedness often increases vulnerability through the loss of productive assets and social capital. Generating capital through savings mobilization is generally a preferable strategy.
  • Avoid targeting when possible. Focusing programming exclusively on a vulnerable group is rarely compatible with building a competitive value chain. The participation of the less vulnerable builds scale and leverages additional skills and capacity. Projects have more impact when horizontal linkages and other strategies ‘pull up’ the vulnerable into wider opportunities. Moreover, taking an inclusive approach avoids stigmatizing or isolating the vulnerable, who from the perspective of other community members may be perceived as being no different than themselves.
Cardno and the 'Inclusive not Exclusive' Approach

Cardno's Stability, Peace and Reconciliation in Northern Uganda (SPRING) project targets areas of the country that have been previously affected by violence. In such an environment, targeting specific groups such as ex-combatents, young mothers, orphans has the potential to create significant stigma and resentment toward targeted groups and even reignite violence. Cardno has therefore adopted an 'inclusive not exclusive' strategy that remains open to the participation of all groups, while putting in place measures to reach the most vulnerable. One component of this strategy was a 50 percent weighting on value chains that support stability and social inclusion during the value chain selection process.[1]

  • Support lower risk activities. Tailor intervention strategies to the limited capacity of vulnerable populations to assume risk. Depending on the level of vulnerability, options may include:
  1. Developing the market for risk-reducing products and services, including health or life insurance.
  2. Reducing initial cash outlay, such as through embedded services from lead firms.
  3. Looking for potential linkages to lead firms.
  4. Promoting opportunities for employment rather than investment in business start-ups.
  5. Building on existing resources, skills and behaviors, where the vulnerable may already feel confident and that that have comparatively smaller time and financial investment requirements. If larger changes are required, these should be divided into smaller intermediate steps to promote confidence and reduce the psychological and financial risk of failure. The figure below presents this graphically.[2]

Riskable Steps

  • Recognize the diversity of vulnerability. There are variations in vulnerability within communities and even among the most impoverished. Effective programs recognize these differences and build diverse entry points into their interventions. For instance, projects may support self-employment opportunities for individuals with more risk tolerance, while promoting employment and asset building opportunities for those who are more risk adverse.
  • Take a multi-sectoral approach. The greater constraints faced by vulnerable populations often require using a more diverse set of intervention strategies and tools to address non-economic constraints. Doing so requires that staff has skills not only in value chains but also in working with the type of vulnerable population that is being targeted.
  • Build horizontal linkages to reach markets and develop confidence. Build horizontal linkages among the vulnerable to improve upon weak economies of scale and to address social issues of empowerment and increasing confidence. These typically informal structures are not always be durable and need not be structured to be so, but offer an entry point through which quick wins can be generated. Including the non-vulnerable within these structures is often a powerful strategy to leverage their skills and status while benefiting the less advantaged.
  • Build market readiness. Vulnerability often limits the capacity and confidence to respond to market incentives. Investing in confidence building, peer support and market exposure is likely to improve the response of vulnerable populations to value chain interventions. Promoting "quick wins"—activities that can be quickly and easily implemented and that produce immediate (if modest) payback—is especially effective in building confidence, as is supporting peer demonstrations that prove the potential for success.

Monitoring and Evaluation

  • Expand measurement frameworks. The process for selection of key performance indicators needs to go beyond traditional metrics for capturing the success of value chain programming. Measuring intermediate steps that reflect the increased capacity of vulnerable populations to take advantage of value chain opportunities (e.g. increased self-confidence) is critical to ensure that projects are reaching their intended goals.
  • Disaggregate project participation. Ensuring the participation of vulnerable groups requires understanding to what extent and under what circumstances they are active in project interventions. Project monitoring systems that disaggregate reach and performance indicators by type of client will facilitate more nuanced analysis.

Footnotes

  1. N. Felton, Early Lessons Targeting Populations with a Value Chain Approach, (2009), 12-17.
  2. J. Wolfe, Household Economic Strengthening in Tanzania: Framework for PEPFAR Programming, (2009), 16.