I received a book on climate change last year for my birthday called Ten Technologies to Save the Planet. It was a bit odd to receive this gift, as I don’t consider myself to be a tree-hugger. But my friend explained that this book will change my life and answer the many questions that I’ve been asking about how developing countries can engage in climate technology.
Chris Goodall, is a businessman and author of several books on climate change, including Ten technologies to save the planet. The book is divided into ten chapters, with each chapter focusing on a range of different technologies that are either developed or being developed to address a specific issue. For instance, there is a chapter on wind power that explains the existing technologies available today to utilise the energy created by the wind. There is also a chapter on alternative fuels that also explain and compare the different feedstock that are available for the production of biofuels.
Unfortunately the book does not deal with issues pertaining to economic development. For instance, I wonder how the global environmental and climate technology revolution that is driven by pro-environmental policies in Europe is going to put European and US manufacturers into the next “industrial revolution” while Africa is still a revolution or two behind? I also wonder how the new climate market systems where companies can trade carbon credits can be used to get developing regions into the global market system. For instance, we have a lot of sunshine and a shortage of electricity generation capacity in South Africa. How can we solve this problem using some of the carbon credits or off-sets of European firms?
But this book is a must-read for development practitioners that are constantly confronted by dreamers who want to become rich or develop industry through investments into “amazing bio-fuel products”. It is now on the top 10 of my favourite books ever. I cannot wait to assess the next value chain for opportunities to reduce energy consumption or to identify opportunities for manufacturing firms to become competitive through better climate technology applications.
Read more about the book on Wikipedia, or visit the Carbon Commentry website where more information on Chris Goodall and issues around Carbon can be found.
On the right hand bar of this site you will find the link to a LEDCast episode that we have just published. In this episode I interview Natasha Walker on facilitation. Natasha is a real guru on facilitation and visualisation. We discuss the essence of facilitation, and share many tips, tricks and discuss some pet hates. The second part of this episode will be published in a few days time. I would love to hear from you!
Very often in training relating to the improvement of regional and local economies we stumble onto the topic of the importance of human capital for productivity and economic growth. This results in three arguments emerging between participants. Firstly, some participants are upset about human capital development, as this often implies a higher level of learning that involves the application of technology or other advanced topics. This is seen as benefiting too few people, especially in Africa where countries are generally suffering from high unemployment and large numbers of under-educated people that are mostly trained into low-technology low-skill (and low wage) jobs. The second argument is about the role of technology in economic growth. Again, people tend to shy away from technological development that is capital (or technology) intensive towards creating jobs for large numbers of people. The third argument is that productivity improvement is not important for growth, as it only benefits the owners of firms and it is according to some people counter-productive for employment creation, as it leads to job losses.
During these arguments it is important to remain calm and clear headed, and to not fall into ideological debates. I will not try to address all three these arguments now except to say that the importance of human capital development is increasingly been promoted by organisations like the Worldbank, the OECD and others (for a great recent report on this click here). This after the topic of tertiary education has received very little attention in global programmes like the Millennium Development Goals and other programmes, with more basic education programmes like universal primary school access receiving more attention. I am relieved that the big guns are now more supportive of tertiary education and its role in human capital development. While I agree that we have to increase employment for large numbers of low-skilled people, we should not behave as if we have endless resources and management capacity available in many developing countries. This means that while we have to create jobs, we also have to be mindfull to constantly work at increasing productivity in order to carefully maximise (or allocate) the resources of the society. I am always amazed at how our politicians in South Africa want to create hundreds of thousands of jobs when we are short managers at almost every level of our society. This means that we may have to settle for less jobs (because we cant manage all these people), and that we better make sure that all the people are in sustainable and productive jobs, within competitive firms in competitive industries. We can not disconnect these different things. In fact, I think we should be calling for far more technology intensive jobs in order to optimise the skills and our resources at our disposal, while not neglecting trying to find ways to get more people with lower skills into the job market.
The times have changed, and being loyal to a country or being comfortable in a society is no longer sticky enough to hold back the increasingly mobile creative talent people of the world. People with talent (or developed human capital) can now work almost anywhere in the world, and then be paid handsomly for the sacrifices of moving. These people do not always leave countries because they are negative about the challenges facing developing countries, although this certainly makes it easier to go and live between a different and often strange cultural group (no offence intended).
I propose that we raise the importance of tertiary education, human capital development and use technological advancement to achieve progress in our developing countries. This will lay important foundations for future economic growth and for the necessary increases in productivity to optimise the resources available to societies.
Early in May I had the privilage of working with the international NGO Worldvision on a Local Economic Development in Soweto. The objective of the assignment was to assist Worldvision to focus its support activities in Orlando East. Zini Godden assisted me as the co-facilitator, and the method we applied was the PACA (Participatory Appraisal of Competitive Advantage) methodology.
Firstly, family and friends were all very worried about me working in Soweto. This was rather odd, as I have been working in predominately black areas since 2002. It shows that there are still some very large judgements about Soweto. For those that want to know, we stayed in a great guest house in the centre of Orlando East. And we had great food. Actually, there is a whole group of guesthouses in Soweto that are quite busy accommodating international tourists.
Secondly, Orlando East is very busy. It is busy on the surface, with people constantly moving about in the region. But it is also busy under the surface. The tavern that we used as our base during our workshops had a credit card terminal. This may sound odd to my foreign readers, but for a business in South Africa to keep a credit card terminal the business must process at least 3000 euro (R30,000) per month. That is a lot of spending power! At the same time, the new Maponya shopping mall in Kliptown is a must see!!!
Thirdly, there are many committed people working in Orlando East. We refer to them as champions, and they go out of their way to make sure the community functions. I have actually not witnessed this level of community involvement ANYWHERE where I have worked before. Some of these people are ward councillors (yeah, they do actually work in some places), community development workers, social workers and many others. The business people gave a lot of their time during several days of workshops, meetings and brainstorming.
Lastly, there are many untapped business opportunities in Orlando East. Unfortunately, there is also low local savings, which means that there is poor formation of investment capital in the region. At the same time, there is a lack of office space for businesses to start, and most investment is taking place in small spaza shops.
On the topic of spaza shops, I witnessed something really sad while working there. While the economic development unit of the City of Johannesburg was working with community structures and the hawkers to formalise and train the hawkers, the Metro police raided the stands of the hawkers. The heavily armed Metro Police moved in and basically destroyed the stands and confiscated the goods of the hawkers. I was so angry. This is a terrible example of how one unit in a municipality can work against another. Contrary to popular belief, many hawkers have invested ALL their savings in their stands. In same cases I estimate the investment to be in the region of more than R5000 (500 Euro) in several instances R10,000 (1000 Euro). I confronted an official and he told me that they were focusing in unlicensed or counterfeit goods (show me an unlicensed or counterfeit banana and win a prize). The official became aggresive when I took photos and insisted that they have warned all the hawkers in writing!!
Look at these pictures and tell me what you think!
Here is an interesting quote from Adrian Rogers that I think should be considered by the governments of the world as they try to figure out how to help the poor, especially during these tougher times
“You cannot legislate the poor into freedom by legislating the wealthy out of freedom. What one person receives without working for, another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is about the end of any nation. You cannot multiply wealth by dividing it”
Of course governments have an important role to play in the fair distribution of resources, but when the creators of wealth feel exploited it might lead to the situation where the rich increasingly find innovative ways to hide their wealth from the governments.
In the press and development circles there is now increasingly discussions about addressing market failures (cases where markets do not allocate goods in socially optimal ways), but what is not discussed are cases where government failures lead to the poor getting poorer, or staying poor. A simple example is the topic of good quality public education. In todays connected economies government failures in education disproportionately affects the poor, resulting in the poor being trapped. At some point the wealthy may react by saying that they should not be held accountable to continued failures (ignorance or denial) by the public sector, leading to a diversion of profits.
Some of the readers of this blog may wonder why I have been so silent in the last month. Those that know me personally were probably aware of the sudden death of my friend and business partner, Jorg Meyer-Stamer. To see how much Jorg mattered in the development community, take a look at the orbituary site that we created.
I am still in shock that Jorg is no longer around. He was such an important force of motivation and inspiration in my world. It all started a few years ago when I was still employed in a GTZ programme in South Africa. Jorg was our leading service provider. At first I found arguing with Jorg exhausting, but over time I started to look forward to the mental challenges that he would pose to me. For a long time I had a feeling that he did not like many of my ideas, like my passion for business services or market failure. Over time our relationship evolved and become more of a mentor relationship, with Jorg constantly challenging me to think my ideas through, or to try harder to connect concepts that were not connected. We started working on some of my ideas together and I realised that he was always very interested in my ideas, and wanted me to follow my intuition with some deeper exploration. As time went by this mentorship relationship evolved into a deep friendship. Jorg did not treat me like a student (and fact he hardly ever did), but as an equal. When I announced my departure from GTZ Jorg immediately urged me to join mesopartner, the international though leader on territorial development.
Together, Jorg and I have presented more than 40 training events or sessions. Over time we became so
accustomed to each other that I could almost predict his next move, and he mine. We did not always agree on everything, but allowed each other the space for personal interpretation. Many people commented on how well we worked together as a team. We always evaluated ourselves critically after each training, and worked hard on improving all areas of our joint-performance. This means that even when we presented our favorite sessions, such as “market failure” or “stimulating competitive local economies”, it always felt new and improved from the previous attempts.
In March, when it became apparent that Jorgs cancer was very serious, he urged me to continue the work we started together. I am determined to do this, because I will forever be indebted to the generosity of Jorg. He took all of us with him on a challenging journey to demystify development and to share practical knowledge with the development community.
I miss my weekly Skype conversations with him about how the world is connected, and how many developmental concepts are disconnected. Jorg was an extremely productive person, and e-mails with ideas, new papers, presentations and general correspondence flowed into my inbox day and night. My inbox has gone silent now, and I regret ever complaining about all the e-mails coming from Jorg with more ideas, more work, more thinking. As I am trying to wrap up some of the projects that we initiated together I am intensely aware of the silence.
Yet, I am reminded of Jorg on a daily basis by his legacy of ideas, papers, tools, and models. For many people that have just discovered his papers, or who have just recently learned about PACA, the Hexagon, or some other ideas of Jorg, he is alive in the text and diagrams. Those of us that worked with him can hear his voice in our heads, explaining why quick wins are important, or how the law of unintended consequences works.
Do you have any great pictures of Jorg in action? Please submit them to the blogsite!
Following the calls and e-mails I received based on the previous post, I thought it might be a good idea to expand on the idea of how climate technology could be used to increase the competitiveness of industry and of certain locales. By the way, you are welcome to share your ideas by commenting and uploading pictures on the blog directly!
What do I mean with “climate technology”? Climate technology refer to the many technologies that are now being developed out there, with well-known examples of solar geysers, solar panels and windfarms. But there are many other technologies that are being developed that range from insulations for homes and offices, to home electricity and heat generation. If you dig deeper, then you find that many industries are now becoming aware that they are using electricity to generate heat, and then using electricity to cool things down again (Have they never heard of heat conversion?). So people are generally becoming aware that if they can use less energy to produce a product, that they will ultimately be saving costs and saving the planet.
There are many forces for change other than the riots, protests and bickering at international conferences about the climate. Last week the first supermarket chain in South Africa was certified as emission free, with several large retailers like Massmart, Woolworths and Marks and Spencer in the process of assessing their emission footprint. These retail chains are now starting to assess how their COMPLETE supply chains are dealing with the environment.They are not only looking at their consumer goods, but also at their total operation. This is just one way that value chain promotion and climate technology is related.
What do I mean with climate technology as a means to increase the competitiveness of industries? Let me first create a picture of the South African manufacturing environment. In general, our manufacturers are losing out to more productive and lower cost Asian producers. But the South African manufacturing industry is still world class in many fields and in many advanced production methods, especially in shorter niche production runs. Furthermore, despite the brain drain that has affected the economy, South Africa still has a rich expert base in diverse technological fields ranging from electronics, metals, to chemicals and all the way to nuclear research. Compared to many other developing countries there is a rich institutional layer (ranging from research institutes to specialised tertiary institutions) that is supporting the private sector.
I believe that we should be actively mobilising the South African manufacturing sector into climate technology, as the international pressure on industries, government and consumers will only increase in the future. Many of these different users of technology are going to start making decisions not only the utility of the product that they are purchasing, but they will increasingly assess the environmental footprint of the product. Furthermore, industries that adopt climate friendly technology are reducing costs in new ways, increasing their cost and brand competitiveness.
Locales or places that start to promote climate technology might be able to get a headstart on other regions, and there are many places where the scale of environmental or climate pollution could actually be used to start completely new climate technology research and development capacity. I can think of the very sensitive waterlands in the Chrissiesmeer region in Mpumalanga province in South Africa that is under threat from coal mining as an example of an area that could provide a critical incentive for the development of a new industry of climate technology producers and service providers (see feature on the Carte Blanche investigative journalism programme). The demand for this kind of technology is there, yet the environmental lobby is still trying in vain to fight industry.
But there are several obstacles, and the first is the limited economies of scale. If the cost of researching and developing new technology is set aside, then costs of finding potential customers (search costs) or applications for new technology is high, and the scale of return is uncertain. Therefore investors are hesitant to enter many market segments. With Southern Africa’s tendency to perform well in small scale and specialised production the risk is lower, if only the producers could identify the right market opportunities. But government and development practitioners would have to play a critical role in supporting this new marketplace, and often public funds is needed to get this kind of initiative off the ground. The current policy obsession with benificiation and final product manufacturing is in my view misguided, and should focus on the strength of the South African industry to develop advanced niche technologies.
Secondly, I get the feeling that many people think that this interest in climate technology and the environment is a fad that will go away. Help, any ideas out there?
Lastly, as development practitioners we must get business, governments and households to understand that using new climate friendly technology save costs for the society on some new fronts. There is more to it than just saving the planet (although that is a good enough reason), it could also mean increasing the cost competitiveness of a company. It could mean smarter ways of doing thing, like finding ways to generate electricity and heat at a home or a business, instead of digging up roads and building coal fired power stations.
So when you conduct your next value chain assessment, ask yourself how the different links in the chain could benefit from technology that is climate friendly. Look at places where heat, steam, chemicals or other byprodycts are generated that may be of value to somebody else.
Over the last few years value chains have become an important topic for donors and development practitioners. I say “again” because as with many other topics there is a tendency for these topics to be seasonal (read fashionable). This is great because every time it becomes fashionable new ideas are brought in, while old experiments provide valuable lessons and knowledge.
The purpose of this post is not to discuss value chain promotion. Just to make sure you understand what I am going on about, I will briefly define a value chain as the path of a product through a conversion process that starts with design (or raw materials), production, distribution and in some cases even consumption. An agricultural value chain will often start with seed, and will end up as a processed food product. On the mesopartner.com website there are several great publications and a LEDCast episodes on the topic of value chains.
In many of the areas where I am working there is a tendency by officials and development practitioners to take on the very tough commodity value chains. These value chains are typically in the traditional sectors and include end products like sugar, wood, furniture, fish, and many other agricultural products. These value chains are very
attractive, as they typically reach into rural areas, involve a large number of people, create many jobs, and often involve small farmers and less educated workers. But these value chains are also the oldest, which means that the actors have had a lot of time to mobilise strong interest groups, entrenched positions, and comfortable way of doing things.
When you look around these traditional value chains, you often find dozens of smaller value chains that are overlooked. Hence the title, “in the shadow of value chains”. These chains include biomass (leaves, sawdust, feathers, etc), traditional medicine and exotic plants (in the case of forestry), wood offcuts (in the case of furniture).
In these secondary value chains are typically very small, and may appear insignificant at first glance. But closer scrutiny may reveal some interesting opportunities to start new firms, or to create skills upgrading opportunities for unemployed or unskilled workers. Extreme care must be taken to not raise false hope, or to push the vulnerable into businesses that they are not able to run competitively. It does not matter whether a trust, cooperative, project or society is used, as these are simply means to an end.
During the analysis these secondary value chains make an extra effort to see why entrepreneurs have not already pursued this idea or opportunity. Also try to determine what the minimum scale is that is required to pursue the opportunity commercially. The economies of scale typically pose a huge barrier to entry in rural or marginalised areas.
I believe that there are huge opportunities in the emerging sector of climate technology and environmental management. I recently saw a biomass to gas converter that can be installed in a community for only a few thousand US dollars. The converter is fed with biodegradable mass and then provides the community with gas for heating, lighting and cooking (another example here). There are many new technologies now entering the marketplace that can give rural areas a complete head start, with biodiesel being a obvious example. It would be great if we can find ways to link cleaner technology and climate technology with new innovative and competitive business processes within the context of value chain promotion!
Firstly, do you have any experience in working with these secondary value chains? Which products, technologies or end markets have you worked with?
Secondly, do you have pictures of obvious resources or business opportunities that are not exploited? I would like to build up a library of pictures of these products, so please post them to this blog so that we can get a movement going on these value chains.
Thirdly, have you investigated CDM and other climate technologies that have the potential to not only save the environment, but to improve the competitiveness of sectors and value chains?
If you are interested to read up a bit more on the green news in South Africa, then head over to Urban Sprout. They have a great website and lots of resources and links to keep you busy. If you are keen to get involved in investigating some of the value chains that are often overlooked, and that may offer interesting opportunities for exploiting by-products chains then share your ideas here!
Whenever a facilitator stands in front of a group of people sitting in a workshop, it is important to realise that the standing position is a powerful and dominating position. While the purpose of a facilitator is to enable a discussion to take place, and certainly to challenge or stimulate thinking; facilitators often use their platform to share their ideas, thus influencing the group. I refer to this habit as ‘facipulation‘, which is a combination of facilitation and manupulation. Inputs made by the facilitator during a workshop could be extremely influential and manupalitive. While in some cases people will not mind being facipulated, in other cases people resent being told by an outsider what to do or how to think.
If it is necessary as a facilitator to make an input during a facilitated session, the facilitator should first ask for permission to switch roles. If the group permits, then the facilitator should take a seat (or take a less dominating position) and share their idea. This is done whilst complying with the rules that the group agreed to at the beginning of the facilitated session. Again, I emphasize, the facilitator must make the input as a normal group member. No special favors or rights for the facilitator like extra long time, or by critising other ideas. I prefer that the facilitator should sit down, as this breaks her power over the group. In fact, I take it so far that I ask a group member to faciliate or make notes on the flipchart in cases where I do not have a co-facilitator supporting me.
Remember, a good facilitator is like a mid-wife of the facilitated discussion concentrating on the process of discussion, while the RESULTS and the CREDIT belongs to the group