After all the analyses of the market are done and the reasons why it does not work are detected, there are steps for the first intervention. Each MSD intervention follows 6 steps for successful completion:
- Pilot intervention
- Is this partner right for you?
- Contracting with a partner
- Thin markets
- Moving to scale
1. Pilot Intervention
Piloting is used to test. Most often, a partner is chosen for the piloting with which the activities will be carried out. Both companies rely on existing data and statistics, as well as new ideas that sound solid. The timing of the implementation of the pilot phase must be strategically thought out depending on the needs of the market.
2. Is this partner right for you?
There are many companies that are potential partners. But what happens if they are not the right partner for us? To see if they are the right partner for us, the desire/skill matrix is used which looks like this:
An ideal partner is one who has both the desire and the skill to work on the intervention with us. Another important feature is leverage. Leverage is the effectiveness of partners in influencing a number of other market actors or points in the system. Influence over others means that the partner is well respected in the community or by other market actors. These companies are easy to adapt to changes, and such companies are ideal partners.
3. Contracting with a partner
It is important that the partner we choose is flexible enough, but also responsible. The partner reports back on their work, so being accountable is key. With the partner we agree on our goal, everyone’s responsibilities, actions to be taken, duration of events, legal obligations, as well as monitoring.
4. Thin Markets
According to Beam Exchange’s definition, a thin market is one “where a limited number of investors and entrepreneurial firms within an economy have difficulty finding and transacting with each other at reasonable costs.”
We may find ourselves in a situation where we only have one company to work with. In that case, we can consider whether an existing company can expand its activity. In this case we can offer several different ways to help this company:
- Expansion cost sharing
- Intensified support in piloting
- Setting the right expectations
- Support of all actors in the market of the same type
- Support of institutions that are related to similar sectors
To find out how things are actually going with our partner, we ask ourselves the following questions:
- Does the partner complete their activities on their own?
- Do they want to continue doing this in the next quarter?
- Are they using this innovation in other areas of their work?
- Is the competition feeling the pressure? Do they change to be like our partner?
At the market systems level, it is more challenging to identify whether there is momentum or not. A good place to start is to identify if there has been any reaction from other market players.
6. Moving to scale
Moving to scale can be defined as: scale is achieved when a large number (again, the large number depends on the context) of non-target market actors have taken up a new market innovation and this in turn has a positive impact in the lives of an even larger number of people. At this stage we not only work with companies that adapt easily, but also with those that adapt more slowly. This phase is achieved in the following way:
- A visit to the company with which we have not cooperated, but has potential
- Conferences and seminars
- Field visits
- Providing printed materials
- Cooperation with journalists to publish details of the intervention
Example of successful MSD story in Bangladesh
In Bangladesh, small and rural farmers work with small seeds, often of poor quality. In contrast, larger farmers use quality seeds that cost 4 times more than small ones. But since even the majority of the population in Bangladesh cannot afford quality vegetables, people consume less than the required amount of vegetables and buy low quality vegetables because they are cheaper to get. In recent years, the demand for vegetables has increased, but small farmers have not increased their profits.
The problem is approached through the Katalyst program which operates through the MSD approach. Katalyst contracted with a company that sells quality seeds to reach out to small producers in the pilot intervention. Small producers do not have the financial means to buy quality seeds or they live too far away, so they cannot constantly purchase quality seeds. To this end, they were trained on why they should buy better quality seeds and specifically, why they should buy a mobile seed vendor containing quality seeds. This means that producers move into all environments and sell to all producers, not just the big seed buyers. This way, the company acquired 5000 new small buyers, and the small buyers were co-financed in the process.
The next step is making quality seeds that are smaller in size. Seed producers didn’t know how to pull it off, but with the help of Katalyst’s research, a new business model was created. This business model made it possible to cover more ground with mini packs than with original packs of quality seeds. Two companies were interested in this, after which they made a business plan with Katalyst and reached out to small producers through various promotional activities. After just one year, sales of mini packs reached 758,000 packs, and 55 sites in Bangladesh had access to mobile seed vendors containing quality seeds, out of 64 total. This brought more income to small producers.
After seeing the positive impact these changes have brought, other companies have joined the intervention to train small producers, sell mini packs and build networks. Seed sellers used the same mini-pack concept for new seeds they were introducing into their product line. Each seed producer today has a network of over 125 regular seed buyers who ensure that the population of Bangladesh is fed quality food.
If you want to learn what an MSD Doughnut is, read the following blog post: What is an MSD Doughnut?
Source of Information:
The story of MSD: achieving sustainable development at scale