Making the value chain work » Manila Bulletin News

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By Jesus Estanislao

Dr. Jesus P. Estanislao

How perspectives change when we look at ourselves as a link–one among many– in a value chain.

Within a family, every member, following the “Santos rule,” is there for the others. In observance of that rule, no one is left alone; everyone else within that home helps all the others. The same should hold within an enterprise: each team is there for the entire enterprise, whose transformation road map can be pursued with great success, if all the enterprise teams contribute and deliver performance on the basis of their performance commitments. No team operates alone; every team operates in cooperation with others for the success of the entire enterprise.

This means that instead of the various members of the family competing against each other, they cooperate closely with each other. And within an enterprise setting, instead of each team competing against all other teams, they look for ways and means by which to work together and collaborate with each other.

Thus, the change in perspective: from competition to cooperation; from operating in separate silos to collaboration, for the shared value of the entire family or of the entire enterprise.

Once shared value is taken beyond the immediate confines of the family and of the enterprise, then cooperation and collaboration would involve the other important stakeholders that belong to the same value chain either in society (e.g. the community) or in the economy. This is where area (or regional) and sectoral value chains come in.

In every case, these value chains need to be strengthened.

Gaps need to be filled. This is a very common problem especially in situations where the social and economic system hardly exists or at best works in a very inefficient manner. As the Foundation for People Development has found out, poor families are caught in a vicious cycle; their problem is systemic: they have no basic education or proper orientation; they have no savings; they cannot start micro-enterprises, by which they can earn a living; and they have no access to the supply chains, which would enable them to effectively participate in, and benefit from, the economic value chain.

Kinks need to be ironed out. In many value chains, the different stakeholders have very few and limited occasions to inter-act with one another. They suffer from systems inefficiency or total systems breakdown since a number of administrative kinks need straightening out. This happens, for instance, when bureaucratic red tape, mostly unnecessary, slows down toa crawl the functioning of the traffic system, the passport application system, or the system for issuance of license plates.

  • Bottlenecks need to be removed. As Commodore Bacordo found out in Albay, roads are next to impossible to navigate; transport vehicles are unavailable; security is not provided to other government workers; technical expertise (such as that required for the repair of simple electric appliances) is simply unavailable. Through coordination, cooperation, and collaboration, it is not only possible, but it is also rather easy, to start addressing these problems directly.

Under the alliance and social responsibility component of a governance and transformation program that needs to be sustained and strengthened, the operative paradigmis much more that of the three “C”s – collaboration, cooperation, and coordination. It is much less that of the one “C,” i.e., competition, which modern economics may have over-emphasized.

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