DRAFT FOR COMMENT

THE SEEP NETWORK’S

VALUE INITIATIVE
ACTION RESEARCH PLANS

SOCIAL NETWORKS AND SOCIAL CAPITAL

IN
URBAN VALUE CHAIN DEVELOPMENT
BRIEF (for the short version)
TECHNICAL NOTE (for the longer version)

Action Research Lead Agency:
Participating Agencies:
Researchers:
Mercy Corps, Swisscontact and Pupuk, Indonesia
Access Development Service, India and its Jaipur partners
Jamaica Exporters Association , The Competitiveness
Company, and Area Youth Foundation
AMPATH, FINTRAC, and Kenya Export Development Agency
Zahra Campbell-Avenell
Mary McVay (SEEP Network)
Mary Morgan (Economicsunplugged.com)
Hana Panggabean, Faculty of Psychology, Atma Jaya Indonesia
Catholic University

Funded by the Bill and Melinda Gates Foundation

September, 2010
ABOUT SEEP Copyright information:

Copyright © 2010 The SEEP Network

Sections of this publication may be copied or adapted to meet local needs without the permission
from The SEEP Network, provided that the parts copied are distributed for free or at cost—not for
profit. Please credit The SEEP Network for those sections excerpted.

For any commercial reproduction, please obtain permission from

The SEEP Network
1875 Connecticut Avenue NW, Suite 414
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Tel.: 202-534-1400 Fax: 202-534-1433
E-mail: seep@seepnetwork.org
Web: www.seepnetwork.org

About The Value Initiative: The Value Initiative is funded by the Bill and Melinda Gates Foundation
to advance urban value chain development and help millions work their way out of poverty. The
Value Initiative funds four urban demonstration programs in cities around the world, facilitating
practitioner learning as we implement. We also facilitate business planning and funder linkages for
advanced practitioners to understand and facilitate sustainability and scale-up. Come learn with us
on the Enterprise Development Exchange http://edexchange.seepnetwork.org .

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ABOUT THE VALUE INITIATIVE PARTNER CONSORTIA: (IDE)

Building a Bridge to a World of Opportunities: Developing a Jamaican Ornamental Fish Value Chain
The Jamaica Exporters Association, the Competiveness Company and the Area Youth Foundation
The Building a Bridge program nurtures the development of a globally
competitive Jamaican ornamental fish industry based on the market driven
production of young men from Kingston’s inner city communities thereby
bringing sustainable wealth and stability to these communities. The focal
learning for this program is how to mobilize the diversity of people
involved in the value chain – from the former gangster to the hobbiest in
suburban Toronto –to contribute to empowerment and wealth creation in
Kingston.

Value Initiative Program Kenya

Academic Model Providing Access to Healthcare (AMPATH); FINTRAC; Kenya Export Promotion Council
The VIP Kenya Program increases incomes for microenterprise owners and workers in under-served, conflict
affected and HIV impacted areas of the Western and Rift Valley provinces of
Kenya – primarily through expanding the passion fruit and juice industry.
Passion fruit is a high value crop that grows well this region of Kenya and its
demand is high and growing from local to international markets. The VIP
program is demonstrating an integrated, graduated approach that customizes
some services for the very vulnerable, while growing the value chain in general
by targeting the general vulnerable population, who are (or which is)
nevertheless experiencing economic and social stress.

Jaipur Jewelry Artisans Development Project (Jjade) - Jaipur, India

Access Development Services in partnership with three community-base NGOS and the Jaipur Jewelers’
Association.
Jjade is strengthening the fashion jewelry value chain, making it more
competitive in national and global markets and improving the working
conditions and social well being of artisans. Jaipur is a historic center for
jewelry making but is losing competitive edge as design becomes more
important than value and volume of raw material in jewelry. In addition,
artisans works under challenging conditions in terms of their wages,
workplace conditions and social welfare. Jjade is taking a market-driven
approach to addressing working conditions that is mutually beneficial for
artisans and owners in the sector.

Value Initiative Program (VIP) – Jakarta, Indonesia

Mercy Corps, Indonesia with Swisscontact, PUPUK, and MICRA
The VIP program aims to increase income, improve working conditions, and
diminish environmental impact of production for Tofu and Tempe enterprise
owners and workers in Greater Jakarta. Greater Jakarta is a thriving megacity of
some 13 million people and a 500 year history as a trading hub. However,
more than 42% of the Indonesian population lives on less than 2 USD per day
and Indonesia’s spiraling urban growth rate of 3.3% is one of the highest in the
world. Tofu and Tempe are traditional foods, widely available fresh and in
cooked form through diverse, convenient vendors – restaurants, informal
market cooks, and mobile carts. As an affordable protein source, there is high
and increasing demand from a wide range of urban consumer groups for tofu and tempe products, The program is
leveraging the strong, positive social networks in the sector to disseminate improved technology that addresses
environmental, health worker safety and productivity issues at the same time.

3
 I. IN BRIEF

In Jakarta, established tofu producers mentor men from their villages to work in their factories.
There workers often graduate to renting the facility for a business, and then set up shop on their
own. The “lead producers” pro-actively help their community – at home and in the city – to thrive
even as they become wealthy. In tofu producing neighborhoods in Jakarta, the rich, middle class
and poor live side-by-side, tied together as in a rural village. As more producers enter the sector,
profit margins decline, pollution is an issue, and some producers take short-cuts that endanger
public health. The VIP Indonesia program 1 is introducing improved production practices to
enhance productivity, hygiene and working conditions, and reduce pollution. They are leveraging
the strong, traditional social networks in the sector to disseminate production improvements,
linking community leaders with formal and sustainable sources of information, technology and
capital.

In ghettos in Kingston, Jamaica, a socially isolated underclass of young people struggle to survive,
governed by a superstructure of male drug traders and gangsters, who are in turn tied to the
political elite. In this context, some young people have formed a social movement for peace - the
Area Youth Foundation – that uses the performing arts and other economic opportunities to offer
alternatives to young people – especially young men. The Building a Bridge program 2 is helping
young inner city men partner with socially mainstream urban entrepreneurs to develop the
ornamental fish export sector. With the backing of the Area Youth Foundation working for peace in
the community, the young men use existing social ties – old and new – to form clusters. The
Competitiveness Company is supporting the mainstream entrepreneurs, linking them to inner city
cluster leaders, thus bridging a very deep social divide.

These contrasting situations illustrate how social networks -

Social Network: who you know
ethnic and religious ties, family bonds, cartels and gangs,
Social Capital: what you can do or
gender dynamics - are integral to the economic lives of people get, because of who you know
living in poverty, and to value chain development in cities. In Social Governance: how social
some cases, they are instrumental to an industry’s networks influence business
development, and value chain developers can gain significant decisions and markets
leverage from mobilizing traditional, well functioning social
networks. In other cases, traditional social networks are focused on negative social functions, are
exclusive or exploitative, and people are forming alternative structures that can be supported to
improve the social and economic lives of marginalized communities.

Example of a Social Network map
Despite the importance of social networks, value chain development
frameworks to date offer limited tools to analyze and address social
relationships.3 The Value Initiative’s demonstration programs test
innovative ways to understand, leverage and improve social relationships
for more effective poverty reduction strategies, in the context of urban

1
Implemented by Mercy Corps Indonesia in partnership with Swisscontact Indonesia, PUPUK and MICRA.
2
Implemented by the Jamaican Exporters Association in consultation with the Competitiveness Company and
the Area Youth Foundation.
3
USAID, 2010

4
value chain development. For more information, publications, pictures, videos and to get involved,
go to: The Enterprise Development Exchange
What are Social Networks?4

In the context of value chain development, we are not talking about Facebook. Rather, we are
talking about a group of people who are connected to each other because of common origin,
interest or co-dependency. Their connection may be based on any number and combination of
social factors including ethnicity, place of origin, religion, gender, affiliation with an educational
institution, etc. There are different categories that help describe different kinds of social networks,
including:

 Size – small as a family or larger as an international religious network

 Structure – peer-to-peer such as a support group of women widowed by HIV, or hierarchical
as an African ethnic group
 Function5– bonding (tying people together against other groups) as in a gang seeking to
dominate drug trade in a region, or bridging (linking people to other networks) as in a
university alumni network seeking to link people to job opportunities
 Governance6– cognitive (informal, based on shared values and beliefs) as in a group of
people from the same ethnic group supporting the same political candidate; or structured
(formal, based on rules and procedures) as in a registered cooperative, a business
association, or a formal social club

The concept of social networks is closely related and overlapping with “social capital” and “social
governance.” If social networks are who you know, social capital is what you can do or get, because
of who you know. And, social governance is the informal and formal rules that control how the
networks operate. All are important for understanding how social factors influence value chain
development and poverty reduction strategies.

What do we know about social networks, social capital and poverty reduction?

Positive development outcomes are associated with high levels of social capital mobilized through
social networks. For example, in projects such as solid waste removal in Bangladesh, resource
management in Russia, water supply in Central Java, Indonesia and agricultural extension in Mali,
high levels of interdependency, trust and information flow were critical to success. 7 This issue has
not been examined in value chain development.

Researchers have devised ways to measure, analyze, and present information about social
networks and social capital. There is no consensus even on definitions or parameters to measure,
but a number of tools are available, including:

4
No organization specifically set out to target the “ultra poor” as defined by the global standard of living below
$1.25 per day; however, the underlying intention is to address poverty and all organizations are testing tools to
measure the poverty level of their clients before and after intervention.
5
Reilly and Phillpot, 2002
6
Krishna and Uphoff, 1999
7
Pargal, Huq and Gilligan, 1999; Krishna and Uphoff, 1999; Isham and Kahkonen, 1999; Eid and Salmen, 2000

5
  Net-Map Toolbox, Eva Schiffer8– uses participatory inquiry and manual mapping
 Inflow, organizational and network mapping tool9– heavily IT based and able to present
large quantities of complex social network data in simple diagrams.
 Introduction to Social Network Mapping – a textbook with a range of tools and techniques
and discussions of methodological issues and concerns 10

In measuring and analyzing social networks, researchers are looking at relationships among
individuals, rather than the characteristics of individuals, and the information is often
presented in multi-dimensional maps. For these tools to be useful to value chain development,
they need to be integrated into VCD frameworks and existing analytical and measurement
practice. A good place to start is to gather and analyze data about ethnicity, religion, caste,
gender and other social status indicators, and to ask questions about the non-commercial
nature of relationships – trust, respect, reciprocity, fear - in the market. Some specific methods
that may help practitioners to do this include11:

 Participant observation uses observation and participation to understand multiple perspectives in a

community.
 Institutional ethnography looks at the paperwork involved in processes to examine power relations.
 Participatory approaches encourage the stakeholders within the community to analyze key issues
themselves.
 Root cause analysis enables stakeholders and project staff to think beyond the obvious symptoms of
a problem to identify the deeper issues at work.
 Analysis of social influencers helps project staff to identify individuals or groups with the ability to
impact the change process and develop a strategy for managing these stakeholders.

8
http://netmap.ifpriblog.org/
9
www.orgnet.com
10
This page is part of an on-line textbook by Robert A. Hanneman and Mark Riddle of the Department of
Sociology at the University of California, Riverside. http://faculty.ucr.edu/~hanneman/nettext/
11
USAID,2010

6
In the context of business and market development, strong social networks are the informal part of
the governance or enabling environment of a value chain in contrast to the formal laws and
regulations that officially govern the value chain.

They can play a range of functions – or present barriers - for vulnerable populations. Social
networks can:

 Allow people into the market – keep people out

 Provide advantages in the market for some groups - cause disadvantages or support
exploitation
 Facilitate or undermine contract and rule enforcement
 Slow or accelerate market growth by supporting or undermining flow of information,
technology, skills, finance, and market linkages
 Influence who owns and controls assets, and how these assets are inherited
 Form a basis for advocacy, or lead to isolation and lack of influence

In sum, social networks have the potential to support – or undermine – all aspects of the value
chain and value chain development.

Research and practice to date has demonstrated many ways to leverage, strengthen and stimulate
social networks, although most of the documentation is from development fields other than
enterprise development. Some strategies typically used include:
 Community mobilization, preparation, trust-building, peace and reconciliation
 Extending networks – inviting more diverse participation
 Enhancing engagement – increasing face-to-face interaction among people located in close
proximity
 “Network weaving” – active individual networking to link specific people together,
sometimes internet-based
 Establishing and facilitating internet/ICT platforms

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  Formal education or capacity building of individuals and leaders in networks,
 Regulation and legal reform
 Funding and protecting formal networks
The vision behind most efforts to strengthen social networks is that the networks evolve from
“inherited” membership to “earned” membership, and from informal to more formal, transparent
and egalitarian regulation.

Some lessons learned along the way include:

 Address gender inequity in all areas of social capital
 Ensure that broader political dimensions of social networks are considered
 Stimulate competition and alternatives to powerful or exclusive social networks
 Keep the focus on the target population, not the network
 Ensure a clear motivation for connection
 Invite diverse membership – adding value by inviting people with new types of information
or assets
 Stimulate “bridging/sharing” function, rather than “bonding/gate-keeper” function

In addition to the Value Initiative, several agencies and researchers are now paying attention to this
issue, including ACVI-VOCA, USAID, and several independent researchers.

What we need to know

The Value Initiative partners have identified a rich set of questions in the following broad
categories – see Annex C for detailed questions:

1. How to measure and analyze social networks and their influence on value chains?
2. How to leverage social networks for impact and scale?
3. How to mitigate against risks of engaging social networks and against negative aspects of
social networks?
4. How to create/strengthen social networks – beyond cooperatives, groups and associations?

In very different contexts, Value Initiative partners are testing specific strategies for leveraging,
strengthening and mitigating the risk of challenging social networks that influence target value
chains and engage target clients. The methodology is simply continuous quality improvement, that
is: sharing lessons and improving programs during implementation. For a detailed description of
each program and their social network development strategy, see Annex A.

Table 1: What are partner organizations testing?

VIP Kenya – Building Bridges VIP Indonesia – Jjade India - Jewelry

Passion Fruit Jamaica – Tofu and Tempe
Ornamental Fish
Targeted HIV impacted Inner city young men, Producers, Informal sector
Population communities, vulnerable to violence workers, vendors – workers in the fashion
especially people as victims and workers and jewelry value chain in
with low assets – perpetrators vendors are more Jaipur
land, capital, skills, vulnerable
social connections

8
 Social HIV impacted Population socially Strong kinship Complex, historic,
Networks families socially isolated from exists in Tofu and hierarchical
and issues isolated from mainstream Tempe structures. Jewelers
farmers’ groups, businesspeople, neighborhoods are the owners who
urban customers intermediaries – who among the Jakarta control capital, inputs
access to are afraid to do migrants at the and trade, are part of
inputs(capital, business in inner city community level. an old and formal
equipment e.t.c)and communities; young These networks are association; brokers –
struck by political- men divided from often not well of different caste and
ethnic conflict ; each other due to linked to each sometimes religion –
Women’s groups community or gang other, or to formal operating on trust –
and farmers’ groups loyalty; Area Youth sources of job out work to
are common Foundation facilitates information (e.g. artisans who operate
structures; an alternative, peace- technology, on a household basis.
AMPATH facilitates based movement. capital), which Artisans may be
support groups Competitiveness lessen their Hindu (of a different
through various Company builds trust capacity for caste), or Muslim.
capacity building through the cluster production Some are migrants
initiatives. process. improvements. dependant on labor
brokers for their
training, work,
housing, etc. NGOs
have been facilitating
artisan group
formation.
Value Chain Increase production Build an export- Increase Improve working
Development of passion fruit and oriented ornamental production conditions and
Objective juice; engage more fish industry. efficiency, competitiveness of the
vulnerable people profitability, industry, especially in
hygiene, and terms of design.
reduce pollution.
Social Build upon and Strengthening the Leveraging existing Providing
Network strengthen Area Youth social networks transformative
Program community level Foundation as an and formal finance and access to
Strategies formal groups institution, so that it cooperatives– technology that helps
can expand linking them to artisans upgrade their
alternative social formal institutions function, and select
networks, support as sources of alternate brokers.
cross-community finance, learning,
relationships technology;
Develop informal Build clusters based Promoting Dissemination and
linkages to and on existing (new and intermediaries who adoption of best
among traders, old) relationships; cross the formal- practices through the
input and service facilitate linkages to informal divide existing social
suppliers(nursery formal, more “elite” networks of artisans,
owners, agrovets input suppliers and religious networks as
e.t.c), lead farmers intermediaries well as social
and juice processors networks of jewelers,
brokers and traders

How we will learn

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The SEEP Network’s practitioner learning methodology is based on 25 years of experience in peer-
to-peer learning and knowledge dissemination. The Value Initiative supports four demonstration
programs, implemented by consortia of organizations with complementary skills, and includes
volunteer SEEP members in the learning process. For this learning theme, partners implement
action research programs in a continuous learning process, to further develop promising practices.
To date, the partners have built significant capacity in sustainable VCD, and have designed and are
implementing programs that specifically reach out to vulnerable populations. Next steps include:

 A public workshop at the SEEP Network annual conference (link) November 1-5, 2010 in
Washington, DC (Arlington, Virginia)
 A n on-line seminar for interested SEEP Network and Market Facilitation Working Group
(MaFi) members for additional capacity building stakeholder consultation (October, 2010)
 Program and learning theme documentation, sharing, and internal dialogue (Present –
October 2011)
 Publications and public training events (Late 2011)

Prepared for the Value Initiative’s On-Line Seminar Oct 18 – 29, 2010

www.seepcommunities.com

Group: “Social Networks and Social Governance in Value Chain Development”

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ANNEX A: CATEGORIZATION OF SOCIAL NETWORKS
Categorization of Social Networks
Category Type Description Example
Size Small Family Any family unit or extended family,
anywhere:
Gang Mawar Neighborhood, Indonesia
Medium Caste of people from a The Hindu Brahmins of Jaipur, India; the
particular city; an ethnic Luos of Western Kenya; graduates of “ivy
group in a country in league” universities in the US – Harvard,
Africa; graduates of Yale, etc. The Tempe Paguyuban of
particular educational Pekalongan, Indonesia
institutions
Large International religious The Ismaili community; the Jain religious
movement community, followers of Sai Baba
Structure Peer-to-peer, People of the same social Support groups for vulnerable women.
cooperative or economic status group
together
Hierarchical People of different social People from the same rural village,
status come together migrating to an urban area, with original
leaders having strong links to housing,
job and business opportunities.
Function “bonding” Tying people together A gang trading in drugs, seeking through
identity and loyalty to control territory
and young “runners” or drug traders,
working against other gangs and/or
cartels.
“bridging” Linking people to other An alumni network seeking to help
networks graduates find good jobs, business
opportunities and appropriate
marriages.
Governanc Cognitive or Based on shared values, People from the same group of villages
e informal norms and beliefs migrating to the city; Informal
agricultural traders or other brokers that
have an ethnic link and collaborate
together; people from the same church,
temple or mosque, when they interact
outside of the institution.
Structured or Based on rules and A registered cooperative or business
formal procedures association; an on-line dating service; a
support group of people impacted by
HIV/AIDS, formed by a public health
organization.

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ANNEX B: PARTNERS AND DEMONSTRATION PROGRAMS

Value Initiative Program (VIP) – Jakarta, Indonesia

Mercy Corps, Indonesia with Swisscontact, PUPUK, and MICRA

Goal: To increase income, improve working conditions, and diminish environmental impact of production for Tofu
and Tempe enterprise owners and workers in Greater Jakarta.

Urban Context: Greater Jakarta is a thriving megacity of some 13 million people and a 500 year history as a trading
hub. However, more than 42% of the Indonesian population lives on less than 2 USD per day and Indonesia’s
spiraling urban growth rate of 3.3% is one of the highest in the world. The city is prone to flooding; there are high
pollution levels in urban streams that exacerbate the problem, and the informal nature of many communities is a
constant albeit low-level uncertainty in the business climate.

Value Chain: Tofu and Tempe are traditional foods, and are also in demand for more modern cuisine like Chinese,
Japanese and vegetarian cooking. They are widely available fresh, and in cooked form through diverse, convenient
vendors – restaurants, informal market cooks, and mobile carts. As an affordable protein source, there is high and
increasing demand from a wide range urban consumer groups for tofu and tempe products, with snack products
experience highest growth in demand especially among upwardly mobile and well-off consumers, and high volume
institutional customers (hospitals, schools, restaurants/hotels) coming in second. The mass market demand among
working class and low-income consumers is also growing, but this group is subject to the worse violations of
hygiene due to their inability to pay higher prices. Most producers are micro-scale and informal, using traditional
and unhygienic techniques and producing unbranded product. They are organized in urban villages of 10-50
producers according to their rural origins. The leaders of these communities were the first migrants, who then
helped others to migrate as workers. Some workers then graduated to become renters and then owners of additional
production facilities. Profit margins are tight.

Competitiveness Strategy: The program conducted in-depth research into strategies for helping tofu and tempe
producers to sell to growing, higher value markets, but concluded that only better-off producers would be able to
overcome the hurdles of the formal market – i.e. product development, formalization, meeting high hygiene
standards, packaging, branding and marketing, etc. Instead, they are focusing on improving hygiene and
productivity and reducing pollution for producers marketing to mass working class and low-income markets – so
they are taking a “base of the pyramid” marketing approach.

Social Network Analysis: Lead tofu and tempe producers migrated from rural areas some 20 years ago, and have
established vibrant clusters of tofu and tempe production that support ongoing urban migration. New migrants take
positions as workers, some graduate to renting and some graduate further to owning their own factory – all with help
from the original community leaders. Some laborer, especially young women, simply earn wages to send back to
the rural area, and may have the option to graduate if they marry a tofu or tempe producer in the city. In some parts
of the city, these informal networks are registered as groups or cooperatives, and there is a city-wide cooperate that
functions primarily to channel government subsidies when they are available, and occasionally to advocate for
maintaining subsidies on imported soy. Other than the cooperatives, there are very few links among traditional
networks or between traditional networks and formal, modern sources of technology, training, inputs or markets.
For vendors of fresh tofu or tempe, and for cooks who vend on the street or in informal markets, social networks are
less established. Most operate on their own, buying directly through the lead producers, although there are a few

12
large lead vendors and many vendors who own several carts and hire people to work them. Lead producers have on-
going relationship with vendors based more on business than social ties.

Methodology/tools for understanding and tracking social networks:

The program will conduct in-depth interviews with tofu and tempe producers, workers and venders along with field
observation to gain insights of the neighborhoods, production flow and marketing process. Secondary data is
added to provide a comprehensive understanding of the targeted population (e.g., demographic variables, cultural
information based on social and ethnographic works on the respondent’s cultural background).

Strategy to Leverage and Improve Social Networks:

 The main contact point for producers and workers are the lead producers, who will spread technology and
information through their community, or designate a representative or entrepreneur to do so. The program
hopes to strengthen ties among producers and vendors for this purpose as well.
 The program is strengthening groups, cooperatives and associations to develop sector leadership.
 The program is testing a range of intermediaries to link formal sources of technology and expertise – equipment
manufacturers, Ministry of Energy, etc. – with lead producers.
 The program is utilizing a commercial market development approach to reach vendors with improved stove
technology, leveraging lead vendors where they exist.
Of course, these strategies are subject to change as they are at the pilot level and the program adjusts based on
experience gained through implementation.

Value Initiative Program Kenya

Academic Model Providing Access to Healthcare (AMPATH); FINTRAC; Kenya Export Promotion Council

Goal: Increase income for microenterprise owners and workers in HIV impacted areas of Western Kenya and Rift
Valley.

Urban Context: The program focuses on the agriculturally-base small towns and cities in Western Kenya and the
Rift Valley, which are historically under-served and/or have recently experienced politically-motivated ethnic
violence. The towns and cities generally rely on agricultural trade. One town, Iten, population 4,000 is home to
several of Kenya’s famous long-distance runners. During the 2009 post-election violence
Poverty in, the route from Eldoret to Uganda was cut in Turbo, with a 1 meter deep ditch. Cities
Rate and towns of this size are experiencing higher growth rates than the capital, with little
planning, infrastructure, or social services to support job-seeking or destitute migrants.
48%-65% Most development programs by-pass towns a cities, facilitating direct links to export
markets.
HIV Value Chain: The passion fruit value chain is well
Prevalenc established in fertile and well-served central
Kenya, in part due to earlier work in the sector by
e Rate FINCTRAC and other. Passion fruit has proven to
5.7 % in grow well in Western Kenya and parts of the Rift
Kenya; up Valley as well. It has the advantage of being a
quick and relatively easy crop to grow, and that
to 35% in the fruits are best when picked before they ripen,
some facilitating safe transport. Passion fruit is in high
and growing demand locally, nationally and in the
areas of
Western
13
Province

VIP target
 12
Districts
(see map)
region – due to positive health effects of fresh juice – and globally. There are a number of fruit juice processing
Main
companies in the country, operating under capacity due to low supply of fruit. AMPATH launched the first formal-
Economic
sector juice processing facility in Western Kenya recently to stimulate production by providing a strong local buyer
Activities
for farmers, and to stimulate local juice consumption and informal processing/distribution.

Agriculture
Competitiveness Strategy: Increased productivity (volume) and access to passion fruit and juice markets.
, bread
Social Network Analysis: In Western Kenya and Rift Valley, the HIV epidemic is spreading in diverse communities.
basket
Some forwell-established, ethnically based social support systems, including farmers and self-help groups
are old with
- that are nevertheless under stress due to men migrating to cities for work, and very high population density without
Kenya
accompanying increased in farm productivity. In other communities, people from different ethnic communities have
settled and in recent years politically motivated ethnic violence has disrupted trade and many development activities.
HIV brings on a number of additional social and economic challenges. Historically, women in this area of Kenya
have little power, land rights, etc., and wife inheritance by a brother in case of a husband’s death is traditional.
People infected with the virus are often between the ages of 20 to 40, the working and family rearing age group. Due
to severe sickness, many lose their sources of income, assets and even a spouse or parent(s). The high death rates
result in many widows, in grandparent and youth-headed households, and in economic marginal family members
adopting larger number of orphans, pushing the entire family into poverty. The extent of the crisis, combined with
recession, conflict and violence, has over-extended the traditionally strong social safety net via extended families,
religious and social institutions. In addition, the social and cultural stigma of HIV is strong. All this leaves HIV
impacted families socially marginalized and isolated and vulnerable to extreme poverty and very poor health – a
vicious cycle that is hard to turn around. AMPATH and others have devised effective medical and community-
based health solutions, aimed in part to re-establish family and community ties and reduce stigma. They also form
social support groups of people impacted by HIV.

Strategy to Leverage and Strengthen Social Networks:

 Targeting the general community, rather than selection HIV impacted populations
 Integrating HIV impacted families into mainstream farmers groups and traders networks
 Facilitating commercial relationships without regard to ethnicity or HIV status, using economic relationships to
bridge social divides
 Targeting vulnerable women for specific subsidies to help the “graduate” to a point where they can participate
in mainstream networks.
 Using a “farming as a family business” approach that engages women and young people in the household in the
decision-making process for production, investment and spending.

-------------------------------------------------------

Jaipur Jewelry Artisans Development Project (Jjade) - Jaipur, India

Access Development Services in partnership with three community-base NGOS (spell out the names)
and the Jaipur Jewelers’ Association.

Goal: Strengthen the fashion jewelry value chain and make it competitive in national and global markets and
improve the working conditions of the artisans and improve their social well being.

Urban Context: Jaipur, the capital of Rajasthan (northeast India) is a major metropolitan area with a rich
history dating to the 1500s as a royal station, and military and trading center, and was formally planned using
Hindu architectural traditions in the early 1700s. A beautiful city, with a population of some 2.5 million, it is

14
known for its rich artisan traditions, including jewelry making. The poverty rate in Jaipur is x%, compared to
a national rate of x%.

Value Chain: The Jewelry sector employs some 200,000 artisans. It is old and well established, with a trade
association of jewelers (owners, rather than artisans) that is over 100 years old. In recent years, global
demand for high value jewelry has declined, in favor of “costume” or fashion jewelry that relies more on
design than quality and quantity of raw materials, and the Jaipur industry has struggled to compete. There is
also some global demand for more fairly traded or responsibly produced jewelry. The industry is organized
by Jewelers (business owners) who control the capital and access to raw materials through a series of
brokers who “job out” different steps in the jewelry making process to family-based artisans. The system
works on trust built through social connections and longstanding business relationships. A newer value chain
is emerging in which cooperatives and artisan or NGO-owned companies are playing a more prominent role
making and trading jewelry from lac, a naturally occurring insect secretion.

Competitiveness Strategy: To improve designs, efficiency in trading and production, and socially responsible
production to better reach national and global markets.

Social Networks Analysis: The gems and metals value chains in the Jewelry sector are led by “Jewelers” –
entrepreneurs who own the raw materials and direct the design, production and marketing process. Jeweler
families are a well established, elite group who come together formally in the 100 year old Jaipur Jewelers
Association (What other social connection do they have to each other?). Jewelers select brokers whom they
trust (why? What is the social connection?), and the brokers “job out” different elements of production to
artisans whom they trust. There are caste and often religious differences between Jewelers and brokers, and
between brokers and artisans – differences that reinforce the business practices that leave artisans
dependant on individual brokers, who often pay for work months after it is complete. Some artisan
communities are well-established in the area, but others are recent migrants who do not speak the local
language and depend on labor brokers for their jobs, shelter, money transfer to the rural families, etc. Many
of these are young men whose families are indebted to the labor brokers. There are both Muslim communities
and Hindu communities of artisans, but artisan families tend to produce in isolation rather than
collaboratively, because of the broker system. In a different sub-sector (lac – a naturally occurring insect
secretion from which bangles are made), the artisans are returnees – people who used to live in Jaipur, moved
out and have now returned. They are a different ethnic group than the other artisans. NGOs in the program
have been working with these artisans to form producer groups and producer-owned or NGO owned fair
trade companies.

Various actors and groups involved in the value chains have formal and informal social networks. The
Jewelers at the top of the value chain largely belong to a same community and hence have a social network,
besides having a formal network in the form of JJA. Besides the jewelers, the artisans largely are muslims,
hindus and migrant labours. These communities have their own peer-to-peer networks as well as religious
networks.

Strategy to leverage and improve social networks: The Jjade program seeks to create alternative trading
avenues and increase artisans’ autonomy to choose among brokers. The program also leverages community
institutions and leadership to sustainably deliver social services to artisans. Specific activities include:

 Leveraging the outreach of community-based NGOs to spread the word about the programs and specific
service offering.
 Organizing artisans into producer groups and companies, primarily to access services (social and
business) and markets. These groups are generally from among the similar communities engaged in

15
 similar kind of economic activity. These best practices can be promoted, disseminated and adopted
through the formal and informal social networks in the value chain.
 “Transformative” finance – freeing artisans from the “bonds” of labor and jewelry brokers; helping
women upgrade from workers to owners of artisan businesses. The existing social networks will be used
to scale up the model on transformative finance.
 Partnering with a neighborhood Mosque to develop a socially appropriate (coed) school for artisan
children.
 Developing the capacity of NGOs to sell or broker insurance and finance on a sustainable basis.

Building a Bridge to a World of Opportunities: Developing a Jamaican Ornamental Fish Value Chain

The Jamaica Exporters Association, the Competiveness Company and the Area Youth Foundation

Goal: to nurture the development of a globally competitive Jamaican ornamental fish industry based on the market
driven production of young men from Kingston’s inner city communities thereby bringing sustainable wealth and
stability to these communities.

Urban Context: Kingston is the capital of Jamaica, a small island known for its beauty, rich musical tradition, good
food, happy people, and high crime. Jamaica has the third higher murder rate in the world, lower only than
Columbia and South Africa. Kingston is the government and commercial capital of the country, whose primary
exports include tourism, boxite and horticulture/food products. The project targets the socially isolated inner city
neighborhoods, informal communities governed by “Dons” whose allegiances dictate the economic opportunities,
and even physical mobility, of mostly young residents.

Value Chain: The ornamental fish value chain is relatively new to Jamaica, but was identified by the government
and the Competitiveness Company as a promising value chain for the country, given its comparative advantage in
climate and proximity to major markets. Fresh water fish rearing has been a hobby of men in the city for
generations, and formal production was introduced through a small-scale and highly subsidized initiative. Only a
handful of farmers became well established, but the project stimulated demand for more assistance among inner city
young men. There are some 500 fish farmers in the Kingston area, the majority of whom are “backyard” producers
using old plastic tubs, bathtubs, refrigerators, and washing machines as tanks, and marketing to local pet shops. As
a nascent industry, all aspects need developing from brood stock, to fish feed, tank and pumps, production
knowledge, all the way through to domestic and international market linkages.

Competitiveness Strategy: To increase significantly export sales of ornamental fish from Jamaica to international
markets, by increasing value, variety and volume, enhancing market relationships from inner-city producer through
importer. The domestic market remains part of the program, but the recession, combined with tax increases and the
recent state of emergency due to an escalation of the drug war, has squelched domestic demand.

Social Network Analysis: The program engages young men, living in the inner cities of greater Kingston, who are
vulnerable to violent crime as victims and perpetrators. These men live in higher fractured communities in which
community territories are firmly demarked such that to cross a boundary is to risk your life. Despite this immobility,
grueling unemployment, one of the highest murder rates in the world, social stigma of living in the inner city, and
social challenges arising from family break-down, the majority of inner city ornamental fish farmers feel positive
about their communities. This irony may emerge from the strong loyalty and identity young people feel about their
neighborhoods, and their strong ties to other young men in their communities. For 15 years, the Area Youth
Foundation has helped individuals to cross the boundaries through performing arts, community peace-building, and
employment readiness work. The cadre of leaders developed through AYF is now developing alternative
community-based and cross-community networks of people seeking economic and social alternatives. In the
ornamental fish sector itself, a very small group of elite farmers formed an association and had captured subsidies

16
from a previous development program. The inner city farmers and this group nearly came to blows when the
program leaders attempted to facilitate dialogue.

Strategy to Leverage and Strengthen Social Networks, and Reduce Risks of Challenging Powerful Networks: The
program is a partnership between the Jamaican Exporters Association, its consulting company and a community-
based organization, the Area Youth Foundation. The strategies with regards to social networks include:

 Selecting a sector that is very male-identified and accepted as a socially relevant and economically viable
enterprise in target communities.
 A cross-community organization – Area Youth Foundation – is laying the groundwork for economic work with
community mobilization, peace building, and access to social services and employment readiness - with staff
who are from and of the communities.
 In the communities, supporting existing ornamental fish farmers to buy from and mentor less established fish
farmers, and to become cluster leaders.
 Facilitate the development of community-based clusters for a range of functions including access to technology,
finance, and markets.
 Facilitate cross-cluster farmer linkages around issues such as input supply, access to finance, technical training,
clustering techniques.
 In turn, supporting the community-based clusters to strengthen positive social networks that are emerging as an
alternative to gangs.
 Identifying and building the capacity of new intermediaries (consolidators) – rather than relying on the few who
had negative relationships with inner city farmers.
 Brokering relationships between lead inner city farmers and emerging middle-class intermediaries – input
suppliers, consolidators.
 Playing a leadership role on a national committee for peace.
 Not directly confronting the “dons” or gang leaders.

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ANNEX C: FULL LIST OF ACTION RESEARCH QUESTIONS
Category
General Question
Specific Question
1. How can we measure and analyze social networks and their influence on value chains?

Measuring and tracking social networks

• What tools can we use to measure and analyze social networks
in the value chain context?
• What visuals and maps work in different contexts to
communicate about social networks, and to help record
progress in social network development over time?
• How can value chain analysis and program planning tools be
adapted to include an analysis of social networks and social
governance?

Recognizing social networks:

• What methodologies are easy to integrate into value chain analysis

that can help practitioners identify the important social networks?
• What types of social networks are present among people active in
the value chain?
• Are the networks purely professional or do they have a social
component?
• What are some barriers to openly recognizing social networks – for
example sensitivity to ethnic conflict, lack of safe language and
vocabulary for talking about social networks? How can they be
dealt with?

Describing social networks:

• What are the common characteristics of people in the network? Of

people left out?
• What is the structure?
• What is the nature for the target population: supportive and
inclusive or exploitative or exclusive?
• What are the functions? The costs and benefits? What motivates
people in the network?

Measuring and tracking change in social networks:

Size – in numbers
Diversity – in bridging connections
Strength – in generating social capital
Influence – on the value chain
Analyzing social networks:
• What is the role of the social networks in the value chain? How do

18
 they influence the market?
• What is the basic nature? Inclusive and having a positive influence
on competitiveness, inclusion and growth of the market, or exclusive
and/or exploitative?
• What is the role of women or other disadvantaged populations in
the different social networks?
• What might be or are some of the unintended consequences of value
chain interventions on existing social networks?
• How might existing social networks influence planned value chain
interventions?

2. How can we leverage social networks for impact and scale in value chain development?

• What types of social networks might be useful for achieving specific

value chain development goals?
• How can we determine if a social network is strong enough for an
intended purpose? If there are several available, how do we know
which to work with?
• In what specific ways can social networks be used to transfer
information or technology?
• What different and appropriate motivations might there be for
leaders to disseminate information, technology or services?
• What makes a good “agent” in the context of different social
networks?
• When linking formal business partnerships and informal social
networks, what kind of people make the best agents to bridge the
gap, and what kind of orientation/training might they need?

3. How can we to mitigate against risks or negative aspects of social networks?

• What activities can a program undertake to protect vulnerable

populations from negative behavior of powerful social networks
practicing exploitation or exclusion?
• Is there a need for alternative social networks?
• Competing market channels?
• Is open dialogue and bargaining a possibility? Can you
offer powerful interests an alternative benefit?
• What are some potential negative consequences of using
positive social networks for value chain development, and how
can we mitigate against these?
4. How to create/strengthen social networks – beyond cooperatives, groups and associations?

• If there are few social networks, should we, and how can we
stimulate formation and expansion?
• When and how do we facilitate inclusion of women in male-
dominated social networks?
• When is formalization a good idea?

19
ANNEX D – LITERATURE REVIEW

Please refer to Social Capital Literature in conference materials file.

20
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