Economic Development and ABCD

The mindset….

“All of life is interrelated. We are all caught in an inescapable network of mutuality, tied to a single garment of destiny. Whatever affects one directly affects all indirectly”

- Martin Luther King Jr. (1929-1969)

Key barriers for economic development globally and in South Africa

Many of these issues could be resolved through simply starting with an asset based approach…

•  Lack of ownership of communities and lack of buy-in •  Dependence and entitlement of communities, from lower self-esteem and lack of

control •  Non-sustainable projects (in both the impact and financial sense) •  Lack of understanding of the local culture and community structures as well as how

success is defined by local communities •  Finding and addressing real root causes is difficult, leading to projects that do not

tackle the real underlying issues •  Lack of access to opportunities and finance – and distance from formal or

sophisticated markets •  Political instability, crime, and violence all compound other problems •  Corruption and misappropriation of development funds

Source:Simanye

Development issues are interwoven and complex, making impact dependent on a range of factors

Enterprise development

Supplier development

Worker productivity

Job Creation

Regional development

Health

Education

Infrastructure

Food security It is difficult to address higher end goals (such as larger enterprise development) without looking at how root causes (poor health, lack of education) have led to the problems in the first place. Solutions must be holistic and focused on the most salient issues in order to create real change.

Source:Simanye

Creating Shared Value begins with understanding the context from multiple sides

COMMUNITY DRIVERS

•  Jobs

•  Training and skills development •  Business support

•  Procurement opportunities and supply chain access

•  Financing

•  Health •  Education •  Food security

•  Infrastructure

GOVERNMENT DRIVERS

•  Promote business growth and job creation

•  Keep citizens healthy and happy

•  Ensure socio-economic development

•  Create political stability

•  Integrated Development Plan (IDP) alignment of initiatives

CORPORATION DRIVERS

•  Profitable operations and shareholder value

•  Legislative and policy compliance

•  Healthy and productive staff •  Saving costs, reducing lead

times and increasing quality in procurement

•  Social licenses to operate •  Good public image and relations •  Infrastructure

Source:Simanye

Our approach: based on a sustainable livelihoods, asset driven model

Simanye’s approach begins with a focus on assets (from social to financial and beyond), and starts with the premise that communities know themselves best. Helping the communities to mobilise their own assets and consider multiple factors to address issues holistically therefore leads to ownership, impact and sustainable development.

Sustainable Livelihoods Framework: DFID Source:Simanye

The key to creating sustainable impact

Clear goals and objectives

Adapting to the context and addressing key needs as well as responding to key assets

Considering economic, environmental, social and developmental variables

Bottom-up, community driven and collaborative processes

Partnerships for success

Innovation and research

Focus on cost efficiency and self-sustainability of projects Source:Simanye

Community engagement process

Respect

Listen, understand, learn

Facilitate and educate, but do not impose or force

The community and local factor is the single greatest factor – above economic, technical or other considerations

Source:Simanye

ABCD  

What is ABCD?

“They will use what they have to secure what they have not” - Rev. Dr. Moses Coady

•  Asset Based Community (Driven) Development (ABCD).

•  ABCD was developed by McKnight and Kretzmann (1993) in ‘Building Communities from the Inside Out’

•  Further developed by the COADY International Institute of St Xavier University in Canada.

•  In South Africa, ABCD is promoted in collaboration with Gordon Institute of Business Science (GIBS) and also implemented by the Department of Social Development

•  The focus is on assets rather than needs, as well as letting communities be the drivers of their own development process thus leading to ownership and sustainability

Source:Simanye

Needs versus Assets

NEEDS BASED ASSET BASED •  Focuses on needs and what is missing •  Focuses on what is already there and what

person or community has •  Intrinsically negative as regardless of how

developed a community it will always have something missing

•  Intrinsically positive – no matter how bad things are there will always be assets

•  Top-down, forced solutions •  Bottom-up organic solutions •  Use of external experts •  Use of local knowledge/expertise and

outside experts (mutual learning) •  Dis-empowering and creates low-self worth •  Empowering •  Leads to dependence and entitlement mind-

set •  Leads to increased sustainability through

ownership of the process by the community •  Not conducive to partnerships •  Conducive to partnerships •  Not tailored as solutions are not context

specific •  Context specific solutions

•  Need for continued external interventions •  Community becomes the long term manager of own development

Source:Simanye

ABCD overview: process

Day 1 •  Positive stories •  Assets •  Associations •  Power

Day 2 • Community

economic analysis

• Mapping Source:Simanye

ABCD overview: process

Day 3

• Transect walks

Day 4 • Action

planning • Success

indicators Source:Simanye

The leaky bucket and demonstrating the multiplier effect

Rural community Assets: tree cutting skills trees

Regional factory Assets: factory and tools, wood-work and carpentry skills

Big city Assets: mass markets, brand, business skills, scale

Sell: R 20 / pile Profit margin: R 20

Sell: R 100 / chair Profit margin: R80

R 220 / chair Profit margin: R120

Source:Simanye

Value  Web  and  Microfranchising  

And after ABCD? The Value Web!