NCSSession 2

Amar KJR NayakProfessor of Strategy & NABARD Chair Professor, XIMB

Coordinator, Centre for Development Research and Training

The Language, Logic and Values of Cooperation versus Competition

in the context of Sustainable Management

The Context

Rural, Agricultural, People at the base of our current Financial Capital based Market Economy Pyramid

Rich

& large

Farmers Poor&

Vulnerable

farmers

Marginal & Small Producers

External Market & Intermediaries

Culture of Agriculture, Health, &

Education

Wea

ther

&

Clim

ate

External Inputs

Liberalization, Privatization & Globalization

Bio-diverse produce portfolioIntegrated Agriculture & Economies of Scope

A Systems View of our Globalizing World and base of our Society

Resource Inflow from the Governments to Community with Asymmetric Disadvantage & Holding Capacity

Conceptual &Theoretical Issues

Language, logic, value of Cooperation & Competitionin the light of

Sustainable Community Systems

Paradigm X Paradigm Y

Perfect Market

Competition

Perfect Community Cooperation

SYSTEMS VIEW OF THE CURRENT CHAOS

COMPETITION COOPERATION

COMMUNITY ENGAGEMENT AT GP LEVEL

INDIVIDUAL ENTREPRENEURSHIP

Paradigm X Paradigm Y

Market Based Competition

Parameters Sustainability through Cooperationamong members of a Community

Self/IndividualWelfare State as per state

regulationsPurpose

CommunityDirect participation for self &

community well being

Top-DownRivalry & Competition Approach

Bottom-upCommunitarian Spirit

EfficiencyMarket Economy

Firm view, Short termLogic

SustainabilitySocial Capital/System

Systems view, Long term

Efficiency, Rationality, Economic indicators; GDP, Income Vocabulary &

Indicators

Sustainability, empathy, altruism, Moral, Social, Sustainability indicators; depth of relationship, happiness, well

being

Private Property Rights, Contracts, Financial Capital

Tools & Techniques Common Property, Trust, Cooperation, Participation, Social Capital

Take and Accumulate for self (clan value) Values

Love and Sacrifice for others(universal values)

Language, Logic, & Values under the different Paradigms

Space (X1) Time (X2) Context (X3) Objective Function (X4) Value Base (X5)Efficiency • Point of

space

• Point of

Time

- • Neutral to Objective • Tight Control

• Output orientedEffectiveness • A body of

space (firm

or

individual)

• A frame

of time

• Closed

System

• Relatively

homogeneo

us

• With regard to objective of

the body or organization

• Tight Control

• Outcomes for specific

actor(s), institution(s), or

organization(s)

• Contract: Give and takeSustainability • Large

extent of

space with

many

stakeholder

s (spread

over an

ecosystem)

• Over a

longer

span of

time

• Open

system

• Natural /

diversified

• Relatively

heterogeneo

us

• To balance and optimize the

multiple objectives of

various entities of the

ecosystem

• Freedom with self control

• Strengthen the weakest in

the system

• Holistic (Inclusiveness, &

Integration)

• Humility, respect for others,

tolerance to heterogeneity,

& equality

• Norms: Give, service, love,

and sacrifice

Characteristics of Efficiency, Effectiveness & Sustainability

Source: Nayak, Amar KJR (2011), Efficiency, Effectiveness and Sustainability: The Basis of Competition and Cooperation, XIMB Sustainability Seminar Series, Working Paper 1.0, December 2011

Directions & Positions of Organization Design Variables in different Sectors/Industries

Technically not feasible Practically Unsustainable

Small Size Large

Multiple Scope Few

Low Technology High

Dispersed Ownership of Resources Concentrated

Simple Management Complex

Community Profit Purpose Financiers

Marginal Producer/Consumer Organization Design Variables Multinational/Global Enterprise

Space & Nuclear, Military, Hydro-electricity, Solar PowerAircraft, Information Technology, Automobiles, Heavy Industries

Agriculture, Retail, Food Processing, Insurance, Banking, Service Providers, etc

Source: Nayak, Amar KJR (2010), Optimizing Asymmetries for Sustainability: A Prism for Agriculture & Rural Development in India, DEAR, NABARD Seminar, Mumbai & XIMB Sustainability Seminar Series 1.0, Dec 2009

Technology Intensive Approach Agricultural Technology Integrated Low Cost AgricultureExternal Input Technology

GM Seeds Seed Local SeedsInorganic Fertilizers Plant Nutrition Organic manure, plant biomassInorganic pesticides Plant Protection Organic pesticidesMore Water Water Less Water Biologically poor soil Soil Biologically rich soil

Process TechnologyMono-crop for commercial purpose Cropping Pattern Multiple and diverse cropping to leverage seasonality for

better food and nutrition security, & better soil health

Specialized mono-crop cultivation with little integration with other farm production

Level of Farm Integration High degree of integration of farm crops with horticulture, agro-forestry, and livestock to leverage higher economies of scope in nature

Regular tilling with Tractor, power tiller, etc Land preparation methods Lesser Tilling for minimal soil disturbance

High Water intensity methods using Canal Irrigation, Deep Bore wells

Water management methods In-situ water conservation methods

High degree of weed management Weed management methods Little weed management through mulching & mechanical weeding

High technology equipments like Combined harvester, etc

Harvesting methods Generally, simpler technologies because of smaller farm size

Highly mechanized post harvest management Post harvest technologies Simpler post harvest techniques

Large scale, technology intensive machinery Processing technologies Simple decentralized processing system

Large scale storage and transportation Storage & transportation methods Smaller storage facilities with minimal transportation

Organizational ProcessTraditional Industrial Organization Design Organizational Design Sustainable Community Organization Design

Centralized, Hierarchical, highly qualified external managers

Management Process Decentralized, simple, local rural youth as managers

Market boundary for products is unlimited and aimed at global commodity markets

Market Space Direct marketing limited to a radius of 350 KM from production location.

Paradigms of Agricultural Technology

Source: Nayak, Amar KJR (2012), Integrated Low Cost Agriculture for Internal Consistency and External Synergy for Sustainability of Smallholder Farmers: Case of Nava Jyoti Agricultural Community, International Conference on GM Food in India, Hotel Marriot, Hyderabad, September 27, 2012.

Approaches Competitive & Market Economy System Cooperative & Social Economy System

1. Orientation Agricultural Research driven by the global players/agents

Top down approach

Agricultural Research to be driven by the Small holder Farmer/Producers requirements

Bottom up approach

2. Governance Principles Centralization National, Regional, Global level outputs

Decentralization Small producer family & Community/Cluster level

outputs

3. Management Methods Capacity Building of Institutions at the national, regional & global level

Investment Decisions driven by the needs of the global/national systems

Partnerships of scientists, organizations, institutions based on familiarity with global/national System

Large & hierarchical Organizations

Capacity Building of small farmers, farmer groups, local institutions/NGOs working with farmer communities

Investment Decisions to be determined by the small holder farmer/producer needs and priorities

Partnerships among farmers, local communities, institutions working with the farmer communities

Optimally sized community based farmer/producer organizations to facilitate small producers in market

4. Research/Innovation Methods

Research/Innovation is reductionist High specialization: Breeding Varieties Agricultural Scientists governed by technological

path dependency rather than usefulness of research to small farmers

Knowledge systems largely based on laboratory and research station experiments

Scaling Up

Research/Innovation is holistic and integrated Integrated Low Cost Agriculture to be the focus of

research Research to be practical & applicable to small

farmer’s context Knowledge systems that are based on action

research in the farmer’s field conditions & situation Replication

5. Indicators/Measurement Units

Food Security at global level Nutritional security at global level Development of national and international

commodity markets Scale & commoditization NPK in soil Central tendencies GDP, Income, Production, Productivity, etc

Food & Nutritional Security through small producer & local communities

Nutritional Security for small producer & local communities

Development of local markets closer to farming communities

Scope or Diversity Carbon content in soil Central tendencies with focus on variances Net Income of small holder farmers/producers

Approaches & Policies under different in Paradigms of Competition & Cooperation

Paradigm X Paradigm Y Paradigm X (In Transition)

Imperfect Market

CompetitionPrimitive

Community Cooperation

Advanced Community Cooperation

TRANSITION STRATEGY RESEARCH IN XIMB

Working Definition of Sustainability: Sustainability is a dynamic state of deep relationships among the people and all the constituents both living and non living within a micro ecological unit that strongly values the acts of sacrifice and love for each other; where the priority is to strengthen the weak and where the spirit of high external cooperation and high internal competition not only drives its own ecological unit to eternal peace, joy and happiness but also inspires other micro ecological units for such deeper inter relationships.

Basic Unit: The micro ecological unit of the global ecosystem is the basic unit; which could consist of a micro watershed, a village, cluster of villages or a cluster of habitations.

 Logic: If the basic unit of an ecosystem is healthy; the whole ecosystem shall be healthy. As every micro ecological unit will have its

own characteristics, solutions and approaches that are context specific and not general in nature shall be the approach that can lead to overall sustainability.

Focal Point: Within the micro ecological unit, the priority is always to strengthen the weakest person or family within the micro

ecological unit. Logic: The logic of the systems theory that is the strength of a chain is the strength of the weakest link is applicable. Further, it is

also strategic to stabilize the most volatile actor, the human actor within a given ecosystem to ascertain peace and harmony in the ecosystem.

Holistic: Convergence and integration of different internal perspectives and external perspectives at the micro ecological unit. The

internal perspectives include philosophical-moral-behavioral perspectives. The external perspectives include political-policy-legal perspectives, technological-innovation perspective, and organizational-Institutional-systems perspectives.

 Logic: Convergence and integration of multiple perspectives brings out several complexities and frictions if we were to negotiate

them in a larger ecosystem or at the national or global level. However, at a level of micro-ecological unit, convergence and integration of these perspectives are feasible; a process that could be synthesized at the subsequent levels.

Value Base: The acts of love and sacrifice for the others in the micro ecological unit is the basis for strong bonding and inter

personal relationships with deep trust and cooperation among each other. Logic: The acts of love and sacrifice for the others have the power to heal the pain, remove the tensions of integration, simplify the

complexities of convergence and integration, and complete the incompleteness in human rationality. The synergies arising out of the acts of love and sacrifice can yield eternal growth and development within a micro ecological unit. When the same value base drives the other micro ecological units, the global ecosystem can become sustainable.

Category I: Social Economy Category II: Industrial Economy

Dignity Identity of self Self Respect Hard Working individuals Faith Trust Love other Cooperation Identity of community Giving Back Sacrifice Social Capital Kulo Panchayats 73rd and 74th Amendment Decentralization Duties of a citizen Appropriate Technology Traditional Seeds Bunding and Stone Walling Well Being Multi Cropping Local Market

Rights Based perspective BPL Card Respect of Government Laws Welfare State, Subsidy, Entitlements Greed Contract Self love Competition National Identity Taking away (return on investment) Accumulate Financial Capital, MGNREGS/NRLM GP / Government Machinery Central Government Centralized Rights of Citizenship High end Technology Hybrid & GM Seeds Large Check Dams GDP Mono Cropping/specialized farming Far away domestic/Export Markets

Table 5: Terminologies & Parameters of Different Paradigms

NCSSession 7

Amar KJR NayakProfessor of Strategy & NABARD Chair Professor, XIMB

Coordinator, Centre for Development Research and Training

Implementing Sustainable Community Systems

Action Research & Demonstration to Recreate Sustainable Community Systems

Supported byRabo Bank Foundation, NABARD, SFAC, XIMB

Rich

& large

Farmers Poor&

Vulnerable

farmers

Marginal & Small Producers

External Market & Intermediaries

Culture of Agriculture

Wea

lth &

Cl

imat

e

External Inputs

Liberalization, Privatization & Globalization

Bio-diverse produce portfolioIntegrated Agriculture & Economies of Scope

Local Producer Owned & Managed Community Enterprise System

Adopt Sustainable Agricultural Management Practices with NRM

Integrate Activities for the producer across 365 days & Converge Resources

for Community Health & Education

Mobilize Community to build Trust and Cooperation among Members and

People in the Cluster

Provide Emergency & Production Credit and Support Village Retail Outlets

Sell surplus produce, undertake Value Addition & Marketing

Family

Village

Cluster (GP)

Ecology

CES

Ope

rate

d by

Tra

ined

Coo

rdin

ator

s, &

Fac

ilita

tors

fr

om th

e Lo

cal C

omm

unity

Reso

urce

Con

verg

ence

from

the

Gove

rnm

ent,

Dist

rict

Adm

in &

Lin

e De

pt. o

f the

Gov

ernm

ent w

ith te

chni

cal &

m

anag

eria

l sup

port

from

Aca

dem

ic In

stitu

tions

, &

Inte

rnati

onal

Bod

ies

Com

mun

ity E

nter

pris

e Sy

stem

(CES

)

Loca

l & U

rban

Mar

kets

(3

00-5

00 K

M fr

om C

ES)

Exte

rnal

Inst

itutio

nal C

ham

pion

s

Net Income

Optimal Size

Leverage Scope

Appropriate Technology

Ownership and internal Resource Generation

Governance & Management by Producers/Farmers

Design Variables of CES

Design Variables and Structure for Sustainable Community System

Community/Cluster (5000 people)

Marketing, Coordinator

Professional Support Board of Internal

Facilitators / Directors of CES

External Facilitators: Professors & Development Experts from XIMB-CENDERET, VRO

600 Members (3000 people)

Principal Coordinator(Community Champion)

Accounts & Systems, Coordinator

Integrated Agriculture, Coordinator

Community Mobilization,Coordinator

Local Interns (1)Local Interns (1)Local Interns (2) Executives at GP, Block, District Level (6)

Village Volunteers (One Female & One Male)

Post Harvest & Value Addition, Coordinator

Local Interns (1)

Education & Health,Coordinator

Local Interns (1)

Organizational Structure of CES

External Facilitators: Experts from our Development Partners & Local Champions