Co-Creating a Customer-Centric Approach
USAID's Agricultural Value Chains Project in Bangladesh (AVC) is a 5-year project that supports economic growth and food security in Bangladesh's Southern Delta. The AVC project employs a Market Systems approach ensuring that development interventions are driven by business incentives to improve the functioning of markets at all levels including higher incomes for farmers.
One intractable systemic problem in Bangladeshi markets is that agricultural businesses generally lack a customer focus. For instance, in the input supply system, competition is based mainly on price and characterized by commission-based selling through dealer/retailer networks. The distributors are seen as the main customer of input supply companies instead of farmers who are the real end-users of these products. This creates perverse incentives to withhold information and even sell excess and inappropriate products to farmers, who in turn apply incorrect dosages to crops resulting in mounting negative effects on buyer-seller trust, yields, health, and environment.
AVC, working in close collaboration with NAAFCO, a leading input supply firm, analyzed this problem and crafted a new customer-oriented strategy using two CLA tools. First, AVC introduced the Business Canvas Model - a co-creative process where an agribusiness's current system is mapped, and a new improved system is crafted in its place. The results are then embodied in an Adaptive Market Actor Agreement (AMAA), a purposeful but flexible agreement, which allows partners to find the best route to their goal. Accordingly, NAAFCO put in place these new strategies to improve customer outreach and change the underlying incentives. As a result, NAAFCO reached over 100,000 farmers who are now enjoying an average increase of almost 30% in yields and 76% income leading to input adoption and safer products for the consumer as well as the environment.