As part of the Institute’s planning process, and in an effort to address the profound changes that the agriculture sector and rural areas in the hemisphere will face in the future, the General Directorate has been leading an institutional transformation and capacity-building process. To this end, it instructed the Planning, Monitoring and Evaluation Division (PMED) to develop a strategy to strengthen IICA’s Business Model. In response to this mandate, the PMED developed a proposal that was approved by senior management and will be implemented in accordance with a roadmap that involves the participation of all of the Institute's units, groups and staff. The analysis of international technical cooperation services provided by multilateral public institutions was carried out based on the principles of public marketing for changing, competitive scenarios such as those we are currently facing.
Demands and clients:
Demands for IICA’s cooperation services can be categorized into five areas. IICA responds to these demands by providing concrete solutions to challenges related to the sector’s sustainability.
1. Supranational demands based on the international agendas of Member States.
2. Demands related to the public policy cycle of Member States.
3. Demands aimed at increasing the productivity of the production sector.
4. Demands from knowledge institutions that require better channels for knowledge transfer.
5. Demands from the global system of cooperation for development and horizontal cooperation, to increase the efficiency of their cooperation through multilateral mechanisms.
Consequently, there are three types of clients: the final recipients of innovation solutions; knowledge providers who utilize the platform to improve their knowledge transfer; and third-party clients who utilize the platform to make international cooperation more effective.
The size of the market in which IICA is a leading institution is explained by the fact that public spending in support of agriculture in LAC reached $40 billion in 2018 and more than $7 million in knowledge-related areas. It is also worth noting that the agriculture business in LAC represents $486 billion; that the Consultative Group for International Agricultural Research (CGIAR) coordinates 16 international research centers with a budget of $846 million per year; and that cooperation for development agencies accounted for $150 billion in 2018, 8% of which was allocated to the LAC region.
Competition
Most of IICA’s competitors in the field of technical cooperation are international organizations. IICA technical specialists at Headquarters and in the National Offices identified FAO and UNDP, respectively, as the institute’s top two competitors.
Technical specialists at Headquarters and in the National Offices identify two distinct competitors; this is due to the fact that, while Headquarters focuses on the area of technical leadership, the National Offices focus more on project management.
Other important competitors in the technical arena are the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), the International Fund for Agricultural Development (IFAD), the Inter-American Development Bank (IDB) and international research centers. In the field of project management, other United Nations agencies and international NGOs have been identified as the main competitors.
Marketing strategy
According to the principles of public marketing, IICA must establish a professional, formal, explicit and technically-designed business strategy. The goal is to instill the idea that the Institute’s sustainability depends on selling services, not just providing them, so that this becomes part of the Institute’s DNA. To this end, eight priorities have been identified:
1. Position the IICA brand with a focus on identity, differentiation and leadership.
2. Expand external relationships within a strict technical and professional framework for international relations.
3. Radically transform the technical management of projects.
4. Expand the current market by analyzing the Institute’s current linkages and defining strategies to increase actions with current clients.
5. Expand or create a market with the private sector, NGOs and producer organizations to develop impactful strategic projects.
6. Develop IICA’s own business and sharing economy platform for the dissemination of innovative solutions.
7. Define an ambitious, bold, aggressive and long-term strategy to enable IICA to become a leading player in the field of cooperation for development once again.
8. IICA must recapture the “spirit of '42”, taking a stand on a key issue with which it identifies and fostering cohesion among all stakeholders to work towards a common cause.
Service structure
The services that IICA provides must be well-defined and described with clarity; this is crucial in order to develop the business strategy. Clients must clearly understand the services that IICA provides, and, more importantly, the benefits they will obtain should they contract IICA’s services.
The principle of resilience should guide the development of clearly structured agendas related to vulnerability, risk, adaptation and reconversion through innovation processes. To this end, the Institute must develop protocols to guide its work, as well as:
1. Align national, regional, and hemispheric agendas towards a common purpose, channeling all actions towards the greater objective of strengthening the Institute’s leadership.
2. Align all institutional actions, projects and events with programmatic strategies that must exceed the “impact threshold” (the level below which interventions are deemed irrelevant due to the low level of impact generated). The Institute must also implement a pre-investment protocol consisting of institutional actions with the potential to be scaled up and replicated.
3. Incorporate the targeting and leadership strategy into the establishment of a Fund for Agricultural Resilience and Rural Well-being in LAC, which would provide resources to leverage counterpart contributions and provide long-term funding of initiatives in the countries and region.
Value proposal
The value proposal involves transforming IICA’s technical cooperation services into a product that is strictly aligned with the mandates of the Convention on IICA and the MTP.
IICA will develop a Platform for Innovation in the Agriculture Sector and Rural Well-Being, thereby strengthening its role in coordinating and driving linkages in the knowledge management cycle, by providing a means for connecting knowledge generated with final users. Innovation is understood to mean a transformative process that capitalizes on novel changes in a product, process, organization, market or institution.
Partners and allies
IICA’s members and mandators—that is, the Inter-American Board of Agriculture—should be considered as the Institute’s sole partners. A strategy and campaign should also be developed to increase the level of involvement and commitment of the Ministers of Agriculture.
Furthermore, a strategy must be implemented to assess the potential to establish partnerships with other agencies of the Inter-American System and key players in the fields of technology, research centers, academic stakeholders and the private sector that have achieved significant progress in their respective areas and with which IICA has launched joint actions, which must be aligned with IICA’s long-term objectives.
Resources
IICA’s response capacity is built upon its human talent, technical expertise and knowledge management infrastructure.
Human resources, the foundation on which the Institute is built, represent a major challenge. The analysis conducted identified weaknesses with respect to the positions to which staff are assigned and the lack of an adequate incentive system, protocols and technical structuring of networks to increase productivity in alignment with institutional challenges.
The Institute’s technical expertise, which consists of technical cooperation tools, is deficient. In most cases, the manner in which these tools should be applied has not been clearly defined. Furthermore, the Institute’s technical staff have limited knowledge of these tools and seldom apply them in their cooperation work.
IICA has traditionally had a strong knowledge management infrastructure. The Institute has great potential thanks to its presence in the countries; the capacities developed in the offices and at Headquarters; its bibliographic and documentary reference systems; as well as its recent work in matters related to digitalization.
Networks
One of the Institute’s priorities involves setting in motion the MTP’s mandate regarding networking. Internal technical networks are currently disintegrating despite their very valuable presence at the hemispheric level. In this regard, there are two challenges: i) establishing, based on the strategies of the Hemispheric Programs, teams of specialists at Headquarters and in the Delegations who will be guided by permanent work agendas that will boost their involvement and participation in all institutional actions; and (ii) designing, structuring and implementing external networks that can contribute to making the Platform for Innovation a reality, integrating all stakeholders (clients) into the flow of innovation solutions that respond to the demands of the sector and the challenges facing the region.
The Convention on IICA (1979), which describes the Institute’s basic duties, allows for clearly defining the nature of IICA’s competencies and the technical cooperation it provides.
IICA has a mission to “stimulate, promote and support its Member States in their efforts to achieve agricultural development and rural well-being”. It achieves this mission by providing its Member States with technical cooperation services, which are defined as “the set of actions aimed at providing contextualized and innovative solutions to the main challenges posed by agricultural and rural development in the Americas”. To deliver this technical cooperation of excellence, which seeks to add value and generate significant transformation, the Institute assumes joint, collaborative responsibilities with strategic partners, serving as a mobilizer and facilitator of actions.
IICA’s mandate can be summarized as follows. Firstly, it seeks to foster the advancement and dissemination of science and technology as it applies to agriculture and rural life. This primarily involves knowledge management, but also innovation as a concrete element. Secondly, it aims to establish and maintain cooperation and coordination relationships with institutions that pursue similar objectives. To this end, the Institute manages networks and serves as an innovation platform. Thirdly, it serves as an advisory body, as well as manages and executes technical programs and projects within the framework of agreements with governments and other regional entities. This essentially involves project management. Additionally, the Institute develops and executes plans, programs, projects and operations to respond to the needs of governments and the private sector in the Member States.
Value proposition: an innovation platform for the development of the agriculture sector and rural well-being that combines knowledge management with the innovative solutions requested by end users.
Knowledge management as an international public good
In this context, the first factor that is emphasized in the 2018-2022 Medium-term Plan (MTP) is the Institute’s technical and scientific capacity for knowledge management, based on its role as a facilitator for national and international scientific research networks, technological development and the adoption of best practices in public policy management.
Figure 1 illustrates IICA’s knowledge management model and its aim to utilize its store of relevant and timely knowledge as an international public good, enabling access to it, for its application and transformation.
Figure 1: Knowledge management model and the role of the Institute as a facilitator
Knowledge management enables IICA to present its services as a value chain that evolves in the following sequence: i) the identification and formulation of knowledge-related problems, which are a product of the social and economic dynamic and are based on concrete challenges; ii) the interpretation of these problems, to guide the implementation of research and development activities by specialized or academic centers that have the capacity to systematize them into theories, instruments, technologies or best practices; iii) facilitating access to these products for those who are demanding solutions, which will require processes involving knowledge transfer, diffusion, access and adaptation and iv) the process to evaluate and provide follow-up on the results and impact of innovation processes, for subsequent expansion.
Applied knowledge: innovation
The second differentiating factor is IICA’s capacity to identify and adapt scientific, technological or practical knowledge, developed within and outside of the Institute, converting it into concrete solutions, in response to the demand for interventions in the political, economic or social agendas of member countries.
These theory- and science-based solutions can be translated into applied innovation, meaning that they can be used to bring about changes in economic and social practices, through the technical cooperation services in the IICA platform
Innovation, as a practice that is applied for agricultural development and rural well-being, includes the improvements made to products, as well as to production practices in all activities in the value chain; to the organization of all aspects of the production unit, tangible or otherwise; and to the management of markets, including models for distribution, storage, supply platforms, marketing, and consumption. It also transforms social processes, creating solutions that differ from those offered by the public sector (State initiatives) or the market (private sector initiatives), based on interest from communities and from organized civil society, and includes the modernization of key organizations, developing all aspects of sectoral and territorial governance.
This knowledge and innovation management platform is based on IICA’s extensive track record of delivering high-quality, timely, relevant, flexible and easily accessible services, through its technical teams that are ideally suited for knowledge integration; its network of offices that provide it with a physical presence throughout the hemisphere; its demonstrated administrative, legal and operational capacity; and its network of linkages with international programs and entities.
Clients
The technical cooperation services offered by IICA respond to the demand for innovative solutions, which will shape the scenario in which the Institute carries out its work. This demand is not abstract; it can also vary depending on its scope, which, in turn, will determine the day-to-day sale of services by the Institute. Strategies, tactics and protocols must be developed to adequately respond to the various types of demands. Potential demand refers to needs that can be met by the services provided by IICA; real demand refers to stakeholders who directly request IICA’s services; effective demand refers to cases in which clients are willing to pay a cost to receive services; and captive demand, which pertains to stakeholders that give priority to IICA under any circumstance. Potential clients include recipient clients, such as public policymakers and rural beneficiaries; supplier clients, such as research centers, universities and technology developers; and third-party clients involved in development aid.
Competition
According to IICA technical specialists, the Institute’s top two competitors are the United Nations Development Programme (UNDP) and the Food and Agriculture Organization of the United Nations (FAO). Other international organizations, including other United Nations agencies, are also considered competitors. Perceptions in this regard vary greatly between technical specialists at Headquarters and in the National Offices.
Marketing strategy
There are three factors that guarantee a successful marketing strategy, provided that they are present at the same time: making clients feel that they received more than what they expected and that they paid less than what they expected to pay, as well as succeeding in selling much more than what the client intended to buy.
To achieve a greater market share for technical cooperation, it is important to develop a marketing protocol based on a strategy aimed at strengthening the Institute’s presence. This proposal has identified eight areas in which IICA has achieved progress and which it must continue to strengthen through standardized processes with broad professional support.
Service structure
IICA must provide its clients with a clear and precise service portfolio that demonstrates its high response capacity. To this end, significant efforts must be undertaken to clearly define the focus of its services and develop the Institute’s business intelligence. The institutional agenda, including its thematic areas of work and cooperation modalities, must prioritize and work towards the larger objective of providing services; this will set the Institute apart, as defined in its business strategy.
The current situation calls for agendas that address the need to make the world's agrifood systems more sustainable through actions that guarantee resilience and boost the capacity to adapt to economic and environmental shocks. The MTP provides a programmatic framework that allows for coordinating work in various areas to achieve resilience in the agriculture sector. The next few years (the rest of the current administration and the following one) will be characterized by the search for solutions to respond to the current crisis (the greatest one in recent decades) and its aftermath, by fostering resilience.
IICA serves as an ecosystem that seeks to create harmony between different components, dynamics and relationships to achieve high levels of productivity.
Partners
The proposal on IICA’s Business Model defines a partner as a stakeholder who is willing to invest its image, political capital, financial resources and prestige to assist the Institute in meeting its institutional mission, and who benefits if the Institute achieves its goal.
This proposal makes a distinction between clients, allies and partners. Clients are stakeholders who receive a service from IICA and who are willing to pay for it. Allies are stakeholders with certain areas of work and interests that are similar to those of IICA. Partners are stakeholders with the same raison d’être as IICA.
Networks
Modern organizational models have promoted network-based structures, which adjust better to complex systems and the high level of flexibility required by certain processes, particularly those related to knowledge management. The MTP has established as one of the Institute’s priorities the development and strengthening of knowledge networks, which will play a key role in strengthening institutional management.
Resources
To carry out its technical cooperation work, IICA possesses a high level of installed capacity, which includes financial, human, technical, relational, information, logistical and infrastructure resources; consequently, expectations regarding the impact and results of its work are high. The Institute’s resources are comparable to those of its competitors and allies in the region.
There are three main funding sources for technical cooperation: the commitments undertaken by Member States in the form of compulsory quota contributions; voluntary contributions by Member States and other stakeholders to fund specific projects that require cooperation, assistance and support; and voluntary resources from the international cooperation system, which includes a wide range of national public, private or multilateral donors.
In the case of IICA, these resources come from:
• Fixed quotas paid by the Member States on an annual basis (if 100% of the quota payments are made, the amount collected is equivalent to USD 29 million)
• Miscellaneous income generated through exchange rate differentials, investments, the sale of assets, or interests (USD 1 to 2 million)
• Variable revenue through indirect cost recovery (ICR) within the framework of technical cooperation projects (USD 6 to 11 million)
Over the course of the Institute’s history, these resources have represented an average of 30 to 40 million dollars per year. Given the fact that IICA is a non-profit organization, expenditures are defined in biannual Program Budgets. Average expenditures and expected income generally represent similar amounts.
This year, by way of example:
• The budget assigned for 2020 is close to 35 million dollars.
• The income expected to be generated in 2020 is close to 31 million dollars.
Figure 1: Evolution of the allocation and execution of external resources at IICA (millions of USD)
