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We are all familiar with the puzzle that is to draw four lines connecting nine dots, four in the corners of a square and one in the intersection of the two diagonals and four in the middle of each side of the square. The only way the lines can be drawn is by extending them out of the square. Oftentimes, in many ways of our thinking, we are co-opted by the predetermined frame of our thought (the square), and not until we break out of this frame can we begin to have new vision, different ways of seeing things, and finally be able to solve problems.
The re-engineering concept, defined as “the fundamental rethinking and radical redesign of business process to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed”, is non-traditional and non-linear as compared to the common way of thinking. Fundamental and radical, as opposed to incremental, means a completely new way of looking at business as if we are to build the business for the future not merely extending or expanding the current one. In terms of planning, it starts by determining what kind of business we want to have in the future and work backward to design and prepare the business.
The question is what does this have to do with agriculture, in particular, in relation to poverty eradication? Frequently, when we talk about agriculture, in particular in developing countries, we are pre-occupied with the current existing agriculture in the country. On one occasion when I had an opportunity to engage in bilateral negotiations with one of the G10 member countries, delegates informed me that agriculture in G10 countries is not like agriculture in the US and Europe, which is agribusiness oriented. Their farming is household farming with around 20 ha/farm and an annual farm income of around US$ 50,000. I told them that by that standard in Indonesia there is no agriculture. What would I call a 0.2 hectare operation with a yearly income of less than US$ 100 using traditional, far from state-of-the-art technology? I call this eking out a living, not agriculture.
A large percentage of the poor in developing countries live in rural areas and make a living through agriculture or in one way or another related to agriculture. It is also true that most populations in agriculture in these countries are living below the poverty line. These poor farmers can be categorized into two groups. The first group includes those who are structurally poor, living and farming marginal, low-quality farmland. This low quality (in terms of both soil fertility and climate) farmland becomes a limiting factor for improving their income beyond the poverty line unless they change to non-farm activities as their source of livelihood. The most that can be done for this group is to foster diversified productive activities both in agriculture and non-agricultural ventures.
The second group includes those who are currently poor but have the potential to climb above the poverty line. They are endowed with relatively good quality land and a suitable climate besides the necessary corporate culture, but lack in economies of scale and possibly some other factors such as their level of education, supporting infrastructure and possibly access to market and financing. This group, if provided with the necessary support such as technology, institutional and financial facilities, marketing infrastructure, can easily be lifted above the poverty line and in fact could once and for all become modern farmers that form the core of agriculture providing enough food and fibre for the population of the respective country and even the world.
The question is how this can be realized? In development planning the first step is to separate the two groups. Secondly, planners have to have a re-engineering mindset that goes beyond traditional thinking, radically and fundamentally asking questions as to what type of agriculture do we envision to develop that can respond to the challenge of the future not that can answer the problems of the past.
Once this vision is established, then we begin working backwards to prepare everything that would enable the vision to materialize. First we need to decide who will be the future farmers forming the modern agriculture. The first choice would be the existing second group, but this does not close the possibility of creating a completely new breed of future farmers that are capable of answering the challenge of the future, possibly some university graduates having a farming family background. The next thing to do is to organize them to a size that harmoniously matches the market, including the provision of all the necessary institutional and other supports, and incubate them until they can be left on their own.
Agriculture is a business production operation. It requires inputs, it uses processing technology (cultivation technology), in fact, to compete in a global market it needs state-of-the-art technology, and a market that generates returns sufficiently enticing for the farmer to pursue the business. In a developing country this can only be established by re-engineering agriculture. This might not be solving the whole problem of poverty, after all poverty will always be with us, but non-structural poverty will certainly be eliminated. Furthermore, developing countries once and for all will have farmers comparable to that of developed countries that can compete in the global market. Only then a developing country can sit at the same table and negotiate on a level playing field with any participating countries in the global market.
In Indonesia, we are revitalizing agriculture, meaning we want to put new life in it. I say, with a view to the future, we should also consider re-engineering.
Written by Togar A. Napitupulu, Senior Economist, UNESCAP-CAPSA, Bogor, Indonesia.
(References available upon request) |
