Laws of nature

Fertile soil and proper irrigation is just the beginning. For agriculture projects, the real challenge is getting crops to their final destination on nature's ticking clock. If roads are poor, markets are flooded or regulations cause delays, even the most productive farming project can fail.

According to the U.N.'s Food and Agriculture Organization (FAO), about one-third of the food produced globally each year—1.3 billion metric tons—never makes it to the plate. In the United States alone, 40 percent of food is wasted somewhere in the process.

While food is going to waste, people are going hungry. Agriculture projects aimed at improving food production can mean the difference between feast and famine in a community—or an entire nation, says Chuck Chopak, Africa regional managing director at DAI, a global development firm in Bethesda, Maryland, USA. In the United States, just a 15 percent reduction in food losses would feed more than 25 million Americans every year. But to deliver the result, project managers must first study the systems that govern large-scale agricultural production.

“As you manage an agricultural project, you have to understand the related economic, physical and social pressures so you can build those into the plan,” Mr. Chopak says.

That means assessing the value and supply chains to identify potential obstacles. In developing nations, those hurdles often revolve around limited infrastructure, a lack of clean water and unstable economies. In the developed world, teams must contend with price fluctuations due to market demands, limited distribution options and overcompetition for a single crop.

The act of growing food itself is rarely what causes project snags, says Steve Cohen, manager of food policy and programs for the Bureau of Planning and Sustainability in the City of Portland, Oregon, USA. “It's the barriers to bringing those foods to market,” says Mr. Cohen. In Portland, for example, where he oversees urban farming projects, zoning laws and regulations outline the rules for growing and selling food on urban sites.

While the challenges vary by region, the strategies for solving them are similar. “From a project management standpoint, you have to identify the barriers with community stakeholders and address them together. The only way to move forward is to raise awareness and get stakeholder buy-in for what you are trying to do,” Mr. Cohen says.

From sourcing organic hair-care ingredients in India to tracking fish as it goes to market in Slovenia, the following project teams all rely on the same strategy: Practice due diligence, secure stakeholder support and test assumptions before building a project plan.

PHOTO BY ROBB SCHARETG

“As you manage an agricultural project, you have to understand the related economic, physical and social pressures so you can build those into the plan.”

—Chuck Chopak, DAI, Bethesda, Maryland, USA

PHOTO BY ROBB SCHARETG

Chuck Chopak, left, and Bill Grant, DAI, Bethesda, Maryland USA

CASE STUDY

The Root of the Problem

Value chain analysis helps African farming project teams ask the right questions.

Cassava root is a food staple in many African nations, including the Democratic Republic of the Congo (DRC). Yet while the crop can be grown in large amounts locally, “Kinshasa, the capital of the DRC, normally has only a two days' supply of cassava,” says DAI's Mr. Chopak.

So why not just grow more cassava? This question, often the first asked on food security projects, wasn't quite the right one. In fact, the FAO found that even if agricultural productivity jumped 60 percent by 2050, 300 million hungry people would still lack access to food.

For many not-for-profits that implement agriculture projects in rural or hard-hit communities, asking the wrong questions is what causes them to fail, says Bill Grant, global lead for inclusive economic growth at DAI.

“Often the constraint we identify is a surprise to the very stakeholders who are funding the project,” Mr. Grant says.

To avoid that mistake, DAI teams start every agriculture project with a value chain analysis. This includes reviewing the risks, benefits, obstacles and incentives for every stakeholder, including farmers, distributors, retailers and customers, says Dave Besch, principal development specialist in agribusiness at DAI. “That's how we find the constraints.”

For example, when Mr. Chopak launched a five-year project, funded by government agency USAID, in DRC in May 2011, the initiative aimed to increase rural production of cassava and reduce the country's food-security risk.

But during its value chain analysis, the project team learned the farmers had no trouble producing cassava, and there was ample unused land where they could expand their crops if needed. The real problem started with the plants themselves. Cassava root is a bulky, low-value crop, and the local road system is bad, making it costly to transport the food.

“Farmers are rational, and they're not going to increase their production when they have limited access to market, often needing to carry cassava to market on their heads,” Mr. Chopak says.

In response, DAI promoted rural processing plants that enable local farmers to transform raw cassava into cassava chips—which are lighter and have a higher marketplace value than the roots. Also, the chips are less perishable, which means shipping times can be extended.

“As we enter the third year of the project, we continue to promote productivity gains to small-holder farmers. For example, DAI has helped farmers gain access to better cassava varieties that are higher producing, and learn improved agricultural practices. is work on both productivity and processing, which will strengthen the connection between farmers and consumers, will continue until the project ends in May 2016,” Mr. Chopak says.

The biggest challenge now is limited access to energy to power the processing plant. “We are addressing this constraint by encouraging the private sector to invest in processing in the rural areas and exploring the use of micro and small hydropower,” Mr. Chopak says.

“Often the constraint we identify is a surprise to the very stakeholders who are funding the project.”

—Bill Grant, DAI, Bethesda, Maryland, USA

FEEDING FRENZY

DAI, along with the Foundation for Partnership Initiatives in the Niger Delta (PIND), used a similar process to help catfish farmers in Delta State, Nigeria deal with increasing market competition. Since feed accounts for up to 60 percent of the cost of producing catfish, high feed costs were making it difficult for small-scale farmers to keep prices competitive.

To help alleviate the problem, the Delta State government was planning to build four subsidized, state-run food-processing mills to drive down the price of fish food. They asked PIND to help them create the project plan.

The team found the price of feed wasn't really the problem. When DAI and PIND conducted an analysis this year, it discovered the real culprit: Farmers were feeding their fish up to twice as much food as needed.

“Instead of measuring the feed based on the number of fish in the pond, they were just throwing it into the ponds until it seemed like the fish were full,” Mr. Grant says.

Rather than building new, subsidized mills—which would have crowded out local feed providers—PIND worked with the farmers' association to put together a demonstration farm where attendees learn how to prepare ponds, manage water quality, change feeding practices and manage information on production statistics more effectively, Mr. Grant explains.

The initial, six-month pilot, jointly funded by the feed companies, hatcheries and the farmers' association, wrapped up in June. Right away, the team received positive feedback. “The farmers reported that by feeding based on an understanding of the weight of the fish, they're reducing their feeding requirements,” Mr. Grant says.

Now PIND is working to broaden the program by educating trainers and helping other associations see the benefits it could provide their members.

“We bring key stakeholders together and help them align their interests to solve a problem in a way that benefits all the actors together, so that they will continue the activity through their own resources,” Mr. Grant says. “We call this taking a systematic approach to achieve systemic change.”

Fonda fish farm is part of an EU program to improve transparency in the food industry.

CASE STUDY

From Pond to Pan

A Slovenian research project enabled a local farm to track—and improve—the quality of the fish it sent to market.

Fish past its sell-by date is a grocery shopper's nightmare. But without a way to track its age, both consumers and grocers must rely on their senses alone to judge food's freshness. A European Commission project aims to use technology to help farmers deliver a safe and appealing product to market.

As part of the “RFID from Farm to Fork” (RFID-F2F) program, multiple EU businesses, government agencies and universities partnered to demonstrate how RFID (radio frequency identification) technology can improve transparency in the food industry. By tracking ingredients and materials across the supply chain, RFID traces food products to their original source in real time and, as a result, can verify their quality at every step in the process. Improved information flow in turn improves food safety.

Currently, many small farms in the EU track their business processes and ingredients using spreadsheets and paper documents. at can make it difficult to manage purchasing and production or to recall a product if a food-safety issue arises, says Mira Trebar, PhD, assistant professor, head of the Laboratory for Computer Architecture at the University of Ljubljana in Ljubljana, Slovenia.

“Building a standardized tracing system that could be used in all food sectors was one of our goals,” Dr. Trebar says.

In 2010, the RFID-F2F program launched pilot projects in four food sectors, including fish handling in Slovenia. As a part of this project, the faculty of the Computer and Information Science program at the University of Ljubljana began working with a sea bass farm called Fonda located in the Bay of Piran, on the Slovenian coast of the Adriatic Sea.

A LONG, COLD JOURNEY

In the Fonda sea bass project, four types of sites were included in the RFID tracking process: the farm, the processing plant, transport and warehousing locations, and the fish market.

At the farm, the team used handheld data readers to collect information about breeding and harvesting operations, including the movement of fish between ponds, receiving juvenile fish from outside sources and the shipment to the processing plant.

In the processing phase, data was tracked regarding how the fish were sorted in boxes by weight and size, and the number of fish per box. When boxes of fish labeled with RFID tags and Quick Response (QR) codes were prepared for transport, RFID data loggers were placed into the boxes so that temperatures could be measured during transportation and at the warehouse to maintain cold chain control. When the fish were delivered to private customers, restaurants, markets or retail shops, the data loggers were removed, temperatures were read and the data was stored. Customers could then scan the QR codes with their smartphones and access the data about the fish they were planning to purchase.

But first, the tracking equipment had to survive the long, harsh journey. “When we prepared the project proposal, we didn't identify up-front the environment characteristics in connection with RFID technology,” Dr. Trebar says.

In the pilot project's planning stage, when team members began talking with the supply-chain companies about how the technology would be used, they realized they needed to protect the equipment so it would function in wet, cold conditions and could establish Internet connections when needed, Dr. Trebar says. To do so, the team designed a stainless steel cabinet for the equipment, and the project moved forward.

Piran sea bass in Fonda fish farm nets

PHOTOS COURTESY OF FONDA

When the RFID systems and software applications were ready for deployment, the team tracked fish shipments for six months, beginning in early 2012, and began assessing the results.

“To measure and quantify the potential benefit, we evaluated performance based on a set of key performance indicators (KPIs),” Dr. Trebar says. The KPIs included:

1. improved efficiency
2. elimination of paper documentation
3. immediate access to data
4. fewer errors
5. improved food quality and shelf life

“The goal was to improve performance and increase the possible ROI through the use of RFID technology,” she says. According to the KPIs, that goal was achieved. The resources required to process orders reduced from two people to one, and the 10-day shelf life of the fish could be guaranteed.

“Good project management played a very important role in the success of this pilot implementation,” Dr. Trebar says. Careful planning and follow-up assessments helped the team deliver the project within schedule—and demonstrate real business value.

“A small company could expect complete return on investment after two years of using the traceability system,” she says.

“Building a standardized tracing system that could be used in all food sectors was one of our goals.”

—Mira Trebar, PhD, University of Ljubljana, Ljubljana, Slovenia

CASE STUDY

A Healthy Partnership

Partnering with Indian farms builds a U.S. cosmetics company's brand.

It's not just men who go bald on top. Beauty company Aveda was out to help women with thinning hair, but the product had to meet the organization's sustainability standards—which meant it had to be formulated with minimal use of synthetic materials.

“It's not always easy,” says Chuck Bennett, vice president of earth and community care, “but it's fundamental to our business model.”

To achieve this goal, Aveda seeks out partnerships with companies that can trace supply chains to farms, co-ops and agricultural communities around the world—but some of these are smaller organizations that sometimes struggle to meet Aveda's quantity demands.

“When we build relationships with individual small farms, they may not be able to meet our needs on a sustainable basis,” he says. “That becomes a project risk.”

Aveda looks for companies such as Nisarga, an Indian supplier that owns a 10-acre (4-hectare) organic farm and partners with other locally owned organic farms to obtain ingredients. “They support small farms and produce quality ingredients using sustainable practices, which made for a nice synergy with Aveda,” Mr. Bennett says.

Nisarga's organic Umbari farm supplies turmeric for Aveda's Invati hair-thickening products. The farm also creates jobs for nearby villagers.

PHOTOS COURTESY OF AVEDA

THE RIGHT INGREDIENTS

To develop the hair-thickening product, Aveda turned to Nisarga for a combination of two herbs: organic turmeric and amla.

The turmeric is grown at Nisarga's organic Umbari farm, which creates jobs for nearby villagers. The amla is grown at an independently owned farm in the community, for whom Nisarga helped finance organic certification. “Paying for certification is often a financial barrier for many of these small farms,” Mr. Bennett says.

To ensure Nisarga and its small-scale suppliers meet Aveda's environmental and social requirements, Aveda contracts annual social and ecological audits, including wage and worker-condition reviews, and periodically visits Nisarga, says Heidi Geier, project manager for the botanical research team. “This is an important risk management piece.”

And it's a key differentiator for Aveda. “Transparency is a critical piece of our strategic business model,” Mr. Bennett says. “Because if we aren't authentic, it will come back to bite us.”

Nisarga helps Aveda partner with other local, sustainable farms, such as Devarashtre, which provides amla fruit for Aveda products.

One of the biggest challenges involved with acquiring the Nisarga ingredients was helping the company complete all of the regulatory paperwork required, Ms. Geier says. “There was definitely a learning curve. Relationship building is key to helping smaller companies with interesting ingredients understand and successfully meet complex, international personal care regulatory requirements.”

Using the Nisarga ingredients, the Aveda team formulated the Invati product line, which includes shampoo, conditioner and a scalp revitalizer. Invati launched in 2012—and it's already among Aveda's top-selling products.

Mr. Bennett attributes its success in part to the Nisarga ingredients and the work Aveda did to support local communities. “We can't measure the precise value individual ingredients bring to a project,” he says. “But we do know through market research that customers value this aspect of our brand.” PM

“When we build relationships with individual small farms, they may not be able to meet our needs on a sustainable basis. That becomes a project risk.”

—Chuck Bennett, Aveda, Blaine, Minnesota, USA