¹ CRRIQ The University of Queensland, Gatton College, Gatton 4343 QLD, Australia.
² Nghean Provincial Extension Centre, Nghean Province, Vietnam
³ CRS Vietnam, Hanoi, Vietnam

Abstract

Key words

Introduction

Small scale production is a typical feature of Vietnamese agricultural industries. The challenge for individual farmers is how to access extension services and markets in a cost effective way. Nghean farmers face the same challenges, and to deal with these obstacles several models for farmers groups such as cooperative, extension club and interest group have been trialled.

Cooperative is based on a business model. Commonly, it is a group of people who pool their resources and form a legal cooperative and conduct a specific business. This kind of cooperative business in rural areas is mainly agricultural service provision or handicraft production. There are very few cooperatives that invest in farming itself because farm production activities are considered to have low profits.

Extension clubs are formed by extension agencies, and mainly run by commune extension boards. Membership benefits are receiving the extension services provided by extension agencies such as training, study tours, consultancy and borrowing from clubs’ extension libraries. Even though members have to pay a membership fee, it is noticeable that a large cost proportion is covered by the local extension budget. This is considered one of the successful extension models in Vietnam. Although this model can help address the knowledge demands of farmers, it has not yet integrated individuals in doing business to overcome the limitations of small scale production and poor market access.

Interest groups that emerged in Nghean in 2001 were initiated by the Agricultural and Rural Enterprise Development Program (ARED) in Nam Hung commune, Nam Dan district. The idea of forming interest groups is to help farmers better exploit existing resources to enlarge their agricultural production by joining together. In this model those farmers who share common interests volunteer to join together and help one another to learn, to plan and to run their own business. With more than four years experience, some interesting lessons have been drawn from the establishment and performance of this model.

This paper presents the forming and functioning procedures of two interest groups in Nghean, namely the Bee keeping Group and the Cultivators’ Group. Then, it discusses critical factors which influence the success and sustainability of interest groups and examines the role of extension officers in supporting farmers to set up and run their own groups.

Bee keeping group

Group establishment.

The Bee Keeping group was established in March 2001. At the beginning, the group had 13 members. All members shared a common interest in bee keeping and were committed to invest human and capital resources to improve their bee keeping production.

The idea of forming interest groups was initiated by the ARED program which was implemented by Nghean Provincial Extension Centre (PEC) and Catholic Relief Service (CRS), a Non-Governmental Organization in Vietnam. The aim was to help farmers set up a self directed learning environment within the community.

Prior to the formation of the interest groups, the PEC organized various activities to raise awareness about the concept of interest groups. First, an initial meeting was held in the commune to provide basic information to interested farmers about forming an interest group. Information provided included: what an interest group is, how it could help farmers, and how it is formed and functions. Then, a study tour to several model farmers’ interest groups inside and outside the province was organized for selected farmers so they could witness the formation, functioning and benefits of those model groups. After that, thirteen farmers interested in forming a bee keeping interest group sent their list to the PEC.

To assist with establishing the group, the PEC help the Bee Keeping group facilitate two meetings. The first one was to declare the formation of the group, set up draft goals and regulations, and to elect group management board members that included a group head, an accountant and a cashier. The second meeting was to decide on the group goals and regulations and make a six month plan for the group.

Group function and achievements

The group conducted a review and planning meeting every six months. In each meeting, the previous period plan and performance were reviewed, problems and needs were prioritized and then a next six-month plan was prepared with the participation of all group members. This plan included what issues to be addressed (objectives), what activities to be organized at what time, and what resources would be allocated.

The other regular activity was monthly meetings. In these meetings, the plan and performance of the previous month were review, and a detailed plan for the next month was made. This plan included what to do, how to do it, when to do it and who was to do each activity. Also, funds and resources were reallocated to each activity to fit with current requirements. Beside management activities, various technical learning activities were also incorporated into monthly meetings.

To cover daily expenses, the group collected membership fees. At the beginning the membership fee was 5,000VND/member/month. Because of the greater expenditure demands for the group activities as well as the increasing capability of group members, the membership fee was increased to 20,000VND/member/month in March 2004.

In the early stages, technical learning was the greatest need for all the members. The group organized various activities such as trainings, meetings to share experiences, field days, and study tours to address members’ needs. When the technical needs were satisfied to some extent, the focus of the group moved to capital and business development strategy needs (these issues were also taken into account from the very beginning but were not the priorities in the early stages).

To satisfy members’ capital needs, the group conducted a revolving fund following a local traditional revolving fund activity to address the lack of capital of its members. Each member contributed 100,000VND every month. The total amount collected from all members was given to a member to invest in their business. The next month, the same amount was given to another member. This revolving fund was then increased to 300,000 VND/person/month due to its effectiveness, members’ demands and the increase of trust among members. As the businesses of the members became more successful, it was easier for the group members to access bank loans from banks because they had collateral. In this way, the needs of capital have been addressed.

To address market access and business development needs, the group established a relationship with the National Bee Company as a major partner. The National Bee Company provided them with almost all the external inputs that group members needed and bought their products for export. The group also targeted the local market. A label was created for their retail honey and pollen products. The group members tried to introduce their product to the local community and Vinh city, which is 40 kilometres from the village. In addition, the group diversified its products. Before joining the group, the only product of the members was honey. By 2005, most bee products such as honey, pollen, wax, bee hives and queen jelly were produced and sold. Product quality also improved dramatically. At the beginning of group formation, honey did not meet export standard, but by late 2003 this honey was being sold to the National Bee Company for export. A summary of the group achievements is shown in Table 1.

Table 1. Achievements of the Bee Keeping interest group

Indicators	2001	2004
Number of members	13	15
Number of bee hives/household	0-15	40-200
Income contribution from bee keeping	Minor –activity	Major activity
Bee keeping method	Free range	Intensive
Product	Honey	Honey, wax, pollen, queen jelly
Product standard	Low	High
Consumers	Local	Local, export company
Size of revolving fund	100,000VND/month/member	300,000VND/month /member
Borrowing bank loans	Difficult	Easy

As a result, business scope and strategies of group members significantly improved. The income of group members also increased rapidly. Many farmers then wanted to join the group. However, the group decided to limit the number of members at 15 and concentrated more on business development issues.

Roles of extension officers

To begin with, Provincial Extension Officers (PEOs) were initiators of this interest group. They organized activities to raise awareness of farmers about the interest group model. Secondly, Extension Officers played a key role in facilitating meetings to form the group and creating the group development plan. They also provided guidance to the group management board and support to run and manage the group. Thirdly, they helped the group develop a relationship with the National Bee Company and other agencies such as banks and Farmers Association. Another important support from the Extension Officers is that they hired consultants to provide the group with technical, group management and financial management training.

Limitations

Although the group was considered successful, there are still some issues that could be improved. First, three members resigned from the group after several months. The reasons were mainly differences in interests and vision. These members did not see the common goals and their success in the future. Another limitation was that in the first two years, the group depended too much on the support of the PEC. This delayed the development progress of the group and meant the group took longer to become self-directed. This was mainly because of the overt interference of the PEOs.

Cultivators’ Group

Group establishment: The Cultivators’ Group was established three months after the Bee Keeping Group, by a group of 12 men. The idea to form this group was that they were men who had never gone out of the village for any other business. Their businesses were purely farming. They had a strong relationship with each other and all had a high desire to enhance their farming business. Therefore they named their group the Cultivators’ Group.

Because the Cultivator’s Group was established later than the Bee Keeping, it benefited from lessons learnt of the previous group. The group followed the same establishment procedure as the Bee Keeping Group. It is noticeable that besides being self-selected, group members had had strong relationships together before joining the group. In addition, all the activities at the forming stage were conducted by the group itself without any support from the PEOs.

Group function and achievements

Similar to the Bee Keeping Group, the management board of the Cultivators’ Group consisted of three members, a group leader, an accountant and a cashier. The group also maintained a six-monthly meeting and a monthly meeting. To cover miscellaneous expenditures, the group collects a membership fee of 5,000 VND/person/month.

Since the group was established by farmers and was not targeted by the ARED program, the program did not have a budget to support its proposed activities. The group management board had to seek help from different public service providers such as the District and Provincial Extension Centres, Farmer’s Association, Plant Protection Centre and Veterinary Centre. Because there were many public services available and the group was an innovative learning model, all the service providers were willing to provide support provided that they received a request from the group and it was within their budget. It is noticeable that many public service providers and social organizations have partnered with the group to arrange demonstrations of economic development models. That was a great advantage for them in technical learning. In addition, it addressed a part of their financial needs.

In terms of business development strategy, the group members initially ran their individual businesses with various farming activities. Some members invested into chicken raising, others raised goats or produced vegetables, etc. After a year, the interest group defined its major business activities as growing vegetables and raising goats because these activities were considered as giving higher benefit than other options. In addition, each household still ran their own business. In June 2003, the group registered as a cooperative and established several group business activities. The members shared the cost buying a tractor to conduct land preparation and transportation services. It also served as a mean of transportation for them to run an agricultural chemical and animal feed store.

To address capital needs, in addition to the support from public organizations as discussed above, the group set up a revolving fund and tried to improve access to bank loans. At the beginning, the revolving fund was set at 100,000VND/member/month. The system of fund distribution was the same as the Bee Keeping Group. After the first round (one year), It was increased to 300,000VND/member/month. At the third round it was 400,000VND/member/ month. The group members also secured loans from the Policy Bank. This bank provided loans with very low interest rate compare to others (0.45% month compared to 0.78% month at Bank for Agricultural and Rural Development in 2001). In addition, borrowers of this bank do not need collateral if they borrow less that 10,000,000VND provided that they have a feasible economic plan and other evidence to show that they can repay the loans in the future. This capital source really helped the group members at the beginning stage. When group members became wealthier and the group registered as an enterprise, accessing larger bank loans became much easier.

It is remarkable that after four years, the group experienced great changes. The group became strong after only one year of establishment. Individual and group business scope increased significantly. Initially, all of the group members did subsistence farming activities. By the year 2004, every member had vegetables to sell daily to Vinh market. Each of them had from 30-60 head of goats. The group had an agricultural service store and ran a land preparation service. At the beginning, the group management board members worked voluntarily. Since the cooperative began operating, each board member received a salary of 300,000-400,000VND/month.

In terms of management, the group became self-directed very quickly. At the beginning, the group faced a lot of difficulties in management due to the lack of leadership and facilitation expertise. However, after one year, it was able to run independently. After three years, the management board was managing and running a small enterprise.

Roles of extension officers

The group was established by its members without support from the PEC. After a short time, it experienced difficulties due to insufficient leadership in the group. Therefore, the PEOs were requested to help them overcome this challenge. The roles of PEOs were:

• Help the group to facilitate some important meetings such as planning and decisional making meetings.
• Provide training on group management and financial management to management board members
• Give the management board advice on managing and facilitating the group.
• Help the group develop relationships with other service providers and clients.

It is noticeable that the roles of PEOs in this case were very clear. Although their involvement assisted the decision making of the group, they never dictated the content of the decision making but only the process.

Limitations

Due to poor facilitation and a lack of leadership skills, the group experienced a difficult period. Group meetings were poorly organized and facilitated. As a result, the group’s development plan was unrealistic and the group could not operate properly. Because of this, the trust of members in the success of the group declined and two members resigned from the group. Eventually, the problem was addressed with facilitation support from the PEOs.

Discussion

The factors critical for the success of these groups (in or view) are discussed under the heading below.

Self-selecting membership and common goals and interests

Self-selection acted as a glue to pull people together and make them go in the same direction. It enabled the groups create power when carrying common tasks since achieving group goals also meant achieving individual goals. In addition, self-selecting and common interest principles for selecting members enabled the selection of those who are known and trusted. Therefore, conflicts of interest, which were defined as a harmful type of conflict in a group by Levi (2001), have less likelihood to occur. In fact, both groups only selected those who had a high reputation in the village and had no conflict with each other. A discussion about developing learning groups by Christodoulou and Gray (1997) indicates that common interests are a factor which influences the success of farmer group. When Pham (2005) conducted a case study on a pig production network in Hoa Binh province in Vietnam he also found that common vision and interests were a motivation for the development of this network. In fact, common goals and interests and the trust which builds from self selecting members helped the Bee Keeping and the Cultivators’ groups overcome difficult period without complete disintegration.

Leadership and role of Extension Officers

Leadership was extremely important to the success of both groups. When it was first established, the Cultivators’ Group experienced lack of leadership skills resulting in poor facilitation and decision making. As a result, the group sank into conflict. In contrast, too much involvement of extension officers in the Bee Keeping Group led to the role of the group leader becoming blurred with that of extension officers. This resulted in the group becoming dependent on the extension officers. Consequently, it took a lot of time for the group to become self directed. Pham (2005) also found that strong leadership is one of the critical factors to the success of a pig production network.

In both groups, the involvement of extension officers influenced their successes. As discussed above, too much interference of extension officers delayed the maturing process of the Bee Keeping Group while lack of facilitation support from extension officer in the Cultivators’ Group meant this group face a difficult period. The question is what is the appropriate level of extension officer involvement?

The purpose of the participation of extension officer is to enhance the leadership of the group. Therefore, there should be a continuous transference of leadership and power from extension officer facilitators to the group leader as the leader and the group develop. In his research, Pham (2005) suggest that the involvement of extension officers should gradually decrease as the farmer groups mature (Figure 2).

Figure 2: The involvement of extension officer over time (from left to right) through development stages of farmer groups (Adapted from Grow 1991 in Pham 2005).

Kiser (1998) states that clarification of the facilitator’s roles is vital. Unclear facilitator roles may lead to an overlap between the leader and the facilitator (Kaiser, 1998). The question here is whether extension officers can be involved in content of the group decision making? Schwarz (2002) argues that an outside facilitator should be a process expert but content-neutral, and should not be a substantive decision maker nor a mediator. When Hogan (2002) discussed the facilitation of small business development in rural areas, she suggested that facilitators should never initiate anything and should never motivate anyone. Also, Kiser (1998) states that the intervention of facilitator should be clearly designed to avoid unnecessary interference in the group. These discussions emphasize again the importance of clarification of the facilitators’ roles. When extension officers acted as pure facilitators in the Cultivators’ Group, that helped the group become self directed earlier than the Beekeeping Group where extension officer, to some extent, dictated the content of the group decision making. Thus, the involvement of extension officers in the process is essential but their contribution to content decision making may negatively influence the development of groups.

Cultural context

High level of trust was another critical factor to group success. In Vietnamese rural areas, people in a village know each other much better and have more close relationships than those in other cultural setting. Because of that, self-selecting enables farmers to choose those who have high reputation and trust into their groups. Therefore, trust among members was ensured before group establishment and also enhanced after that. In the villages where two groups were set up people normally help each other financially by the model of revolving funds. These cultural norms were the base for building trust in groups and the success of group activities.

Perhaps in Vietnam urban setting or the Australian setting, the cultural norms may not support condition of trust and commitment group activities that were required to make business focus groups as successful as they were in case study setting. Therefore, these factors may need to be taken into account when replicating this approach in different cultural settings.

Conclusion

From the reflection of the Bee Keeping and the Cultivators’ Interest groups it can be concluded that self-selecting membership, common goals and interests, high levels of trust and commitment and leadership are internal factors that critically influence the success of the groups. The involvement of extension officers as facilitators or supporters is considered an important external factor to help the group in the early stages. However, the participation of extension officers should reduce as the groups develop and mature. In addition, their roles should be clarified to avoid overlapping with the group leaders. They should not be involved in the content of decision making but only the process.

References

Christodoulou N and Gray J (1997). Managing change – building knowledge and skills: Proceeding for the 2^nd Australia Pacific Extension Conference, 18 to 21 November 1997, Albury, NSW.

Hogan C (2002). Understanding Facilitation: theory and principles, Kogan Page, London

Kiser AG (1998). Masterful facilitation: becoming a catalyst for meaningful change, Amacom, New York.

Levi D (2001). Group dynamics for teams, Sage Publications, Thousand Oaks, California.

Pham VL (2005). Assessment of Self-Reliant Village Extension Networks: Case studies in Hoa Binh Province of Vietnam, Master thesis, UQ, Gatton Campus.

Schwarz R (2002). The skilled Facilitator: a comprehensive resource for consultants, facilitators, managers, trainers and coaches, Jossey-Bass, San Francisco, California.