Enterprenurshi and Agriculture

THE ROLE OF ENTREPRENURAL SKILLS ON AGRICULTURAL DEVELOPMENT: A CASE OF HORTICULTURE FARMERS IN KAJIADO COUNTY ISINYA DIVISION

2012

Abstract

entrepreneurship development is a pet subject in the world today.It is currently at the focus of much theoretical, practical and political interest that has led to far reaching changes in the global sphere. One sector in particular that has to deal with large-scale and rapid change is the agricultural sector. The agriculture sector around the world has experienced profound changes in recent years for restructuring, and facilitation of the entrepreneurial skills of farmers and stronger entrepreneurial orientation in the rural areas have been hailed as possible solutions for the emerging problems. The study aims at providing an insight in the role of entrepreneurial skills on agricultural development as it correlates to the horticulture farmers in Kajiado county Isinya division, a region with significant agricultural sector. Specifically, the study aims to: Examine the relevance of the concept of entrepreneurship to the farm in enhancing the value chain; identify and analyze the social economic and cultural factors which hinder or stimulate the development of entrepreneurial skills by farmer; to contribute to entrepreneurship policy and strategy development. This research aims to draw these lessons by systematically analysing the role of entrepreneurial skills on agricultural development in the area using qualitative research methodology together with some quantitative aspects to complement qualitative data. Most of the quantitative data will be derived from secondary sources but will include a smaller component of primary data. In so doing, this research hopes to contribute to entrepreneurship policy and strategy development.

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CHAPTER ONE: INTRODUCTION

1. Background to the Study

Entrepreneurship is a decisive factor in order to achieve dynamism and competition for today’s knowledge-based economy. According to Thurik & Wennekers, in today’s start-ups and its new varieties, entrepreneurship is considered not only as a means of contributing to employment and social and political stability, but as a power for innovation and competition (Sarri & Trihopoulou,2005).

There is a growing belief that entrepreneurship, innovation and new risks provide necessary fuel for modern development engines. Economists and entrepreneurship scholars consider entrepreneurial behavior as an entrepreneurial discovery existing in all economic and human activities (Analoui, Moghimi and Khanifar, 2009).

Entrepreneurship development is a pet subject in the world today. It is currently at the focus of much theoretical, practical and political interest that has led to far reaching changes in the global sphere. One sector in particular that has to deal with large-scale and rapid change is the agricultural sector. The agriculture sector around the world has experienced profound changes in recent years for restructuring, and facilitation of the entrepreneurial skills of farmers and stronger entrepreneurial orientation in the rural areas have been hailed as possible solutions for the emerging problems.

There exists innumerable business opportunities in the agriculture and allied sectors. Investors from all over the world are making more and more investments into the sector for unleashing its existing potentialities as well as for exploring the untapped areas. As such there is a growing interest in the field of entrepreneurship worldwide (Bruyat & Julien, 2000).

This renewed interest can be explained by the belief that entrepreneurship is important for the economic and social development of any given country (Hisrich, Peters, & Shepherd, 2008; Shane, 2003).

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The role of the farmer is changing, as farmers have to develop new skills to be competitive. In a word, they need to become more entrepreneurial. Warren describes the ‘new’ functions which farmers have to engage in to be successful. He suggests that:

‘there is pressure for farmers to become more all-round entrepreneurs, diversifying away from the production of crops and livestock as raw commodities for transformation further up the supply chain’. (2004.372.

In Kenya, the Ministry of Agriculture is the main authority in Kenya for regulation and development of activities relating to agriculture, horticulture, fishing, animal husbandry, etc and is actively engaged in promotion of entrepreneurial activities in the segments of horticultural development fish processing as well as fruits and vegetables processing. Besides, commodity boards, like tea board, coffee board, etc. have been set up to boost the growth of the sectors like tea and coffee, respectively.

Agriculture is a mainstay of Kenya’s economy, and provides the basis for the development of the other sectors. Its direct contribution to GDP is 25% and it indirectly contributes a further 27% through linkages with agro-based and associated industries. and there is growing demand for horticulture and its allied sectors (including fruits and vegetables, flowers, plantation crops, spices, aromatic and medicinal plants) in urban areas within the country and overseas. Entrepreneurship, has been instrumental in addressing numerous economic and social problems, particularly unemployment in the country (Kanyi, 1999; Kapila, 2006) and Institutions and individuals promoting agricultural development now see entrepreneurship as a strategic development intervention that could accelerate the development process in the sector. As a result of the significant contribution the MSEs in the Kenyan economy, deliberate efforts in terms of financial, legislative and regulatory policies have been made to promote them. More recently, attention has been directed in agricultural related MSEs, since it was realized that they constitute an important economic and social category.

Farmers in Kajiado County are becoming more convinced that there is little future for them unless they become more entrepreneurial in their approach to farming. Which means that they produce increasingly for markets – local, regional as well as global, and with a profit motive. There’s nothing new about rural entrepreneurship. But the challenges faced by family farms in the South right now are unique in scope and scale. What options are there for small-scale farmers to become more entrepreneurial?

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2. Statement of the Problem

The entrepreneurship and intrapreneurship fields receive considerable attention today and in the changing rural and agricultural scenario of the country, entrepreneurship in agricultural development is now considered as the need of the times. However, the presence or creation of agri-entrepreneurs seems to be lagging behind the existence of entrepreneurs from other sectors such as manufacturing and services. Since most of the farmers in Kenya are not highly educated or may not have even had a formal education, they do not realize their potential as agri-entrepreneurs or they do not recognize how their daily activities developed their entrepreneurial skills over time. Thus the objective of this study is to providing an insight on the role of entrepreneurial skills on agricultural development as it correlates to the horticulture farmers in Kajiado county Isinya division, a region with significant agricultural sector. Specifically, the study aims to: Examine the relevance of the concept of entrepreneurship to the farm in enhancing the value chain; identify and analyze the social economic and cultural factors which hinder or stimulate the development of entrepreneurial skills by farmer; to contribute to entrepreneurship policy and strategy development. These factors are significant issues, which needs to be addressed by all stakeholders in the agricultural socio-economic network (i.e. farmers’ associations, research and advisory organisations, market and chain parties, governmental and social agencies) can be used as focal points to motivate the farmers in a more structured manner in order to increase the agricultural and horticultural sector’s performance.

Research Objectives

The overall objective of the study is to give an insight on the role of entrepreneurial skills on agricultural development with special focus on Kajiado county Isinya division.

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Special Objectives

In the light of the issues explicated in the above statement of the problem, the study specifically seeks to explore and investigate the following:

a) Examine the relevance of the concept of entrepreneurship to the farmers

b) Identify and analyze the social economic and cultural factors which hinder or stimulate the development of entrepreneurial skills by farmers in the area;

c) Establish the nature of agricultural marketing co-operative movement in Kajiado

d) To contribute to entrepreneurship a policy and strategy development.

Research Questions

This research is designed to provide answers to the following research questions

a) What is the relevance of the concept of entrepreneurship to the farmers in enhancing the value chain;

b) What are the social economic and cultural factors which hinder or stimulate the development of entrepreneurial skills by farmers in the area;

c) What are the agricultural marketing cooperative movements in the area.

d) What are the prevailing entrepreneurship policy and strategy development

Significance of the Study

This study may prove significant in contributing information for enhanced attention to the role of entrepreneurship on agricultural development as well as improved coordination amongst diverse actors: development agencies see agricultural entrepreneurship as an enormous employment potential; politicians see it as the key strategy to prevent community unrest; farmers see it as an instrument for improving farm earnings; and women see it as an employment possibility near their homes which provides autonomy, independence and a reduced need for social support. To all these groups, however, entrepreneurship stands as a vehicle to improve the quality of life for individuals, families and communities and to sustain a healthy economy and environment.

Theoretically, it will add to the existing knowledge on small and medium scale

enterprises by providing empirical evidence on indigenous SME leadership and

management practices and their relationship with organizational effectiveness. It

will suggest direction useful to individual enterprises and government

Delimitation of the Study

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In order for the research to be manageable it would be delimited according to the type

and size, the geographical location as well as the organizational level.

Participation in this study is delimited to stakeholders involved in horticultural farming, stays in Kajiado-Isinya Division. Only those questions that are approved by an expert panel will be included in the survey instruments. Further, test-retest reliability analysis will be used to determine which questions on the role of enterprenurship in agricultural development in the area will be utilized in the final document.

No distinction will be made between small scale or large entrepreneurs operating in the horticultural sector of the area, as this is beyond the scope of the research question. Furthermore, the aim is to approach the role of enterprenurship in agricultural development as a whole, in so far as this is possible.

The gender diversity issue will not be addressed, and therefore the study will not investigate whether there are differences between men and women with regard to the role of enterprenurship in agricultural development . Such an investigation would, no doubt, yield important insights as the entrepreneurship literature generally indicates that there are important differences in the ways in which male and female entrepreneurs use networks and social capital and this equally applies to entrepreneurs in Ghana (Kuada, 2009).

To the best of our knowledge gender specific studies in entrepreneurship have not specifically addressed the issue of gender in relation to youth. However, at this early stage of research into youth entrepreneurship, it is perhaps premature to segment youth according to gender, and it is beyond the scope of this thesis which, as a starting point, seeks to gain insights on youth in general.

Furthermore,The study does not cover the……

The researcher limited this research to……

This study is limited to………

Limitation of the study

it is confined to only Isinya division of of Kajiado county, Therefore, the findings of the present investigation have the limitation of wider generalization

the study is limited in scope with the understanding that neither time

nor money would allow for a comprehensive study of the role of emterprenurship in agricultural development in Kajiado county

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Entrepreneurship is The process of initiating a business venture, organizing the necessary resources and assuming the associated risks and rewards. Entrepreneurship as an option. For many years there was many worries surrounding the idea but recently there has been an outbreak of entrepreneurs making money and living a better quality of life. Women and minorities are now starting their own ...

the data will be obtained from a enumerators, and hence the information obtained may have significant deficiencies

Summary

It will begin with chapter one. This chapter will consist of Background of the study, Statement of the problem, Purpose of the study, Research Objectives, Research questions, Significance of the study, Assumption of the study, Limitation of the study, and Delimitation of the study.

Definition of terms

Entrepreneur is an innovative agent, who introduces something new into the

economy – a new method of production or a new product, a new source of material or new

markets. An entrepreneur’s function is to revolutionize the pattern of production by exploiting

an invention or introducing an untried technological possibility for producing a new commodity

(Schumpeter, 1971).

Entrepreneurship

Entrepreneurship is a concept that has to be defined clearly because of the large range of

interpretations that exist in the literature, as demonstrated by the literature review (McElwee, 2005).

In this study, the concept of ‘entrepreneurship’ is used to explain the phenomenon of value creation within new or existing businesses. Some elements of the key concept of entrepreneurship as it is used in the EU project are as follows: entrepreneurship is connected to a person (the entrepreneur) and his or her activities and tasks; entrepreneurial tasks and activities are focused on starting, developing and continuing a profitable business; the entrepreneur has to be able to find ways and means of creating and developing a profitable business. This is in line with the major literature on entrepreneurship, as analysed in McElwee, 2005.

Entrepreneurship is therefore different from professional and management tasks and activities,

although it affects all professional and management activities. McElwee (2005) quotes Corman and Lussier (1996), who state that the ability to operate an organisation requires different skills and abilities than those required for being an entrepreneur.

Skills :

The project concentrates on entrepreneurial skills. Because of the large range of definitions available, the project group explains the skill concept using two statements:

Skills are related to tasks and activities. For example, a farmer needs certain skills to be able to …deal with customers / …grow crops / …identify business opportunities etc.

Skills can be developed by learning and experience, excluding traits and personality characteristics.

For this research project, it is important to focus on aspects of entrepreneurship that can be developed.

Entrepreneurial skills are such qualities that are required to recognise business opportunities and to put them into business practice.

McElwee (2004) defines farmers as those individuals occupied or employed on a part or full time basis in a range of activities which are primarily dependent on the farm and agriculture including the practice of cultivating the soil, growing crops and raising livestock or fish as their source of income or livelihood.

For purposes of this paper, farmers’ entrepreneurship will be understood to refer to that status of farmers’ engaged in the organization and management of any farming enterprise while applying innovative skills to achieve sustainable expansion of farming operations and (periodically) shouldering a degree of state of uncertainty by undertaking calculated economic risk to maximize profits.

Summary

This chapter dealt with the introduction. It reviewed various efforts made by

developed and developing countries to encourage

The chapter further highlighted the objectives, research questions, hypotheses,

scope, limitations and the significance of the study. The operational definitions of

some concepts used in this study were also provided.

What makes this research unique is that this paper goes in-depth into seeing if SMEs instead of incumbent firms that are actively pursuing aspects of sustainable entrepreneurship (social, environmental and economical) are viable. Previous research tailoring specifically to the capacity of this particular inquiry has not been published at the time of this research, and research in profitability of sustainable entrepreneurship in itself is scarce, with even the handful of papers that only discuss the subject supporting this scarcity as well.

CHAPTER 2 :LITERATURE REVIEW

Introduction

An examination of the past studies serves as a pointer for future investigation. It is an

account what has been accomplished by previous scholars/researchers and what needs to be

done. The trends created by predecessors pave the way for researchers to proceed further.

The literature survey on different dimensions of topic under study is presented in the following

heads.

This chapter provides a presentation of the relevant literature, where the main variables relevant to answer the research question are further elaborated upon. The section commences with

The relevance of the concept of entrepreneurship to Agricultural development

Globalization and business competition around the globe has made entrepreneurial strategies an important concept in new and well established businesses (Bruin & Dupuis, 2003).

Increased environmental changes and intensification of global competition, enterprises, without consideration of their size and duration of their operation have no choice but to put more effort on building on entrepreneurial strategies for them to be competitive.

Entrepreneurial activity is a vital source of innovation, employment and economic growth (Birch, 1979; Carree and Thurik, 2003; Parker, 2004; Storey, 1994; van Stel et al., 2005; Wennekers and Thurik, 1999, among others).

Scholars who study entrepreneurship have lent great value by continuing to explore the factors that explain how entrepreneurs best create new business and thus, how societies and economies grow and prosper. With the entrepreneurial turn of the 1990s, during which universities invested in building high-quality faculties to teach and research entrepreneurship and governments increasingly viewed entrepreneurship as a solution to many social and economic problems, there has been considerable growth in new research from psychological and economic points of view.

Entrepreneurship entails venturing into new enterprises and renewing and innovating in already established organizations. This means that entrepreneurship can be located in all types of businesses regardless of their size, period they have been operational, and profit orientation. In addition, entrepreneurship is said to be the process of creating value in enterprise through identifying and exploiting opportunities, for example through coming up with new products, searching for new markets, and or both (Bruin & Dupuis, 2003).

Richard Cantillon (1725) and Jean Baptiste Say (1824) are some important French writers who expressed views on the role of the entrepreneur. For Cantillon, an entrepreneur is one who bears uncertainty, buys labour and materials, and sells products at certain prices. He is one who takes risks and makes innovation on factors of production. He was thus the first to recognize the crucial role of the entrepreneur in economic development. Say also made similar contribution, considering the entrepreneur the pivot of the economy and a catalyst for economic change and development (Deakins, 1996:8-9).

On his part, Schumpeter (1934) sees the entrepreneur as an innovator. He does new things in a new way. He supplies new products; makes new techniques of production, discovers new markets, and develops new sources of raw materials.

The modern use of the term “entrepreneur” is usually credited to the works of Schumpeter. Drucker (1985) considers that the entrepreneur always searches for change, responds to it and exploits it as an opportunity. The American Heritage Dictionary defines an entrepreneur as a person who organizes, operates and assumes the risk of business ventures. In their own contribution, Meredith, Nelson and Neck (1991) posit that entrepreneurs are people who have the ability to see and evaluate business opportunities; to gather the necessary resources and to take advantage of them; and to initiate appropriate action to ensure success.

According to Baumol (1990:895) entrepreneurship can be productive, unproductive (e.g. rent-seeking), or even destructive (e.g. illegal activities).

He defines entrepreneurs as ‘persons who are ingenious and creative in finding ways that add to their own wealth, power, and prestige’ (1990:987).

Henrekson (2007:719) in a similar vein proposes that ‘entrepreneurship can be seen as a continual quest for economic rents, i.e. rates of return exceeding the risk-adjusted market return’. He describes (2007:729) the sources of ‘Ricardian’ rents (and their short term equivalents of ‘Marshallian’ rents) such as access to natural resources, patents, and tacit knowledge, and points out that these rents can be obtained through many different means: from innovative activities to bribes. According to Coyne and Leeson (2004:236) this may imply that underdevelopment is not due to an insufficient supply of entrepreneurs, but due to a ‘lack of profit opportunities tied to activities that yield economic growth’.

For de Lauwere, Verhaar, and Drost (2002) the definition of entrepreneurship in agriculture has changed during over the years. In the past being a good entrepreneur was being a good craftsman, whilst striving for a high level of production and product quality and making efficient use of inputs (labour, nutrients, crop protection and energy).

The focus on craftsmanship to be cost efficient needs now to be combined with the challenge for sustainable production through finding a balance between People, Planet and Profit. According to Smit, (2004), entrepreneurship has become probably the most important aspect of farming and will increasingly continue to be so.

According to Macke and Markley (2003), economies with high rates of entrepreneurship are performing well, and this is evidenced by high levels of prosperity. Many authors argue that entrepreneurship is largely a phenomenon of developed and industrialized countries and that, if it was transferred together with western management practices, then the problems of underdevelopment could be solved (Casson, 1982, Hisrich et al 2008 and Deakins and Freel 2003).

Entrepreneurship has been seen as a key to economic development in many countries across the globe for many years (OECD, 1998 and 2003).

For instance, in the European Union’s Employment Strategies, entrepreneurship has been given a major role to increase the dynamism of economies and help employment creation and improvement (CEC, 1999 and 2003).

The European Union’s ‘Gothenburg strategy’, adopted in 2001, is based upon the three complementary factors namely: economic, social, and environmental foundations. The strategy recognizes the inter-dependence of these factors (CEC, 2005).

For Knudson et al. (2004) except for a few important exceptions, the role of entrepreneurship and innovation has been given little emphasis in agricultural economics. However, whilst agricultural economists have not placed much emphasis on entrepreneurship and innovation, it has become a priority with policy makers and is a critical aspect of value-added agriculture. Furthermore, few of the techniques associated with the generic entrepreneurship literature have been used to inform farm entrepreneurship research. Indeed, this literature search identifies only a small number of articles that attempt to define farm entrepreneurship and only several, which attempt to apply literature from other sectors to the farm sector.

An agri -preneurship is any business in the agricultural industry which includes production agriculture, food, fiber, the environment and natural resources. Agri entrepreneurs avoid low- risk situations because there is a lack of challenge. They avoid high risk situations because they want to succeed. They like achievable challenges. They do not tend to like situations where the outcome of a quest depends upon a chance and not on their efforts. They like to influence the outcome of their quest by putting in more efforts and then experiencing a sense of accomplishment. A risk situation occurs when Agri-entrepreneur is required to make a choice between two or more alternatives whose potential outcomes are not known and must be evaluated in advance, with limited information. A risk situation involves potential gain and potential loss.

An agri-entrepreneur are highly creative people. They always try to develop new products, processes or markets. They are innovative, flexible and are willing to adopt changes. They are not satisfied with conventional and routine way of doing things. They involve themselves in finding new ways of doing the things for the better. Bryant (1989) discusses the role and importance of farm and non-farm entrepreneurs in the rural environment. He suggests that the notion of entrepreneur is freely ap-plied within the agricultural sector and the entrepreneurs themselves are argued to be key decision-makers in the political, social and economical environment. Rural entrepreneurial activity is considered challenging due to environmental constraints, but for Bryant, should be supported.

Farmers are becoming more entrepreneurial and developing new skills and functional capabilities in order to be competitive. In Poland, entrepreneurship is a relatively recent phenomenon. Entrepreneurship has very different meaning in terms of the collaboration between farmers as producer organisations. Within the planned economy years farmers were members of soviet type producer organisations. Poland was the only country within the former Soviet Block with the majority of privately owned agricultural land. This situation still has an influence on cooperation and makes the organisation of farmers much more difficult than in other countries because, according to a number of Polish authors (Duczkowska-Małysz, 1993; Gutkowska and Capiga, 2001) farmers have only recently developed an entrepreneurial spirit.

Fostering entrepreneurship and the creation and support of rural businesses is a crucial goal for the survival and integrated development of rural local economies. However, despite the recognition that entrepreneurship is one of the primary facets through which rural economic development can be achieved, empirical research on rural entrepreneurship in Italy is relatively sparse and this concept remains largely unknown as well as the role and the function of rural entrepreneurs, the driving force behind birth, survival and growth of rural enterprises. Their study into rural entrepreneurship in a mountainous area of central Italy, aims to provide a contribution in this direction presenting and analysing results from a questionnaire submitted to a sample of 123 rural businesses and entrepreneurs. This research emphasise the correlation between entrepreneurial human capital and business’s use of instruments of assistance and on their role in stimulating entrepreneurship.

In Europe, entrepreneurship in agriculture is a key issue with policy makers, researchers, farmer

organizations and advisory service providers who have devoted significant resources towards farmer entrepreneurship development. According to research conducted by the European Union (EU), due to the changing business and other environments, farmers need to adjust accordingly to ensure that they acquire professional, management, strategic, opportunity as well as co-operation or networking skills with the last three being categorized as entrepreneurial skills.In Malaysia, Entrepreneurship is the key to success in sustainable agriculture, and the success or failure of sustainable agriculture will largely decide the fate of rural Malaysia. Farmers know that in addition to the personal satisfaction they get from working with the soil, they are also stewards of the land and water and a crucial economic force in rural communities, providing consumers with a healthy diversity of conscientiously produced foods and fibers. Malaysian farmers have proved themselves creative and resourceful in developing, adapting, and adopting successful production systems, but few have had the opportunity to hone their entrepreneurial skills business evaluation and planning, record keeping, marketing, financing, managing human resources, and the scores of other details necessary to a going concern. However, if sustainable agriculture and rural Malaysia are to thrive, these are the very skills that farmers have to learn. (Arif and Yanti, 2002).

According to Firlej K. (2001) the development of entrepreneurship means also a change of quality of management in the process of farming. The necessary condition for risk reduction in activities other than farming in rural areas necessitates the organisation and support of local community government. For Żmija (2001) entrepreneurial development in rural areas has been connected with a progressive modernization of agriculture and is connected with multifunctional rural development. The aims of entrepreneurial development in agribusiness are modernization and reconstruction of fragmented agriculture, building an agriculture environment and creating new jobs in rural areas.

Hanf and Muller (1997) suggest that in a dynamic environment with fast technical progress, open-minded farm entrepreneurs will recognise more problems, as they are able to solve in a rational way. Therefore, an agricultural entrepreneur has to recognise problems and work with them until decision-making is possible, create and maintain his personal cognitive requirements for problem solving and decision-making and allocate limited time to management and operational tasks as well as to problems and decision-making.

In the past, African agriculture was hugely disadvantaged by distorted macro-economic policies, including overvalued exchange rates, industrial protection and high export taxes on agricultural commodities. However, these distortions have now been reduced in most countries. From a development perspective entrepreneurship has recently come to be seen as a viable alternative to formal employment in Africa. Much development aid is therefore being focused on the ways in which to unleash the potential of the African youth through entrepreneurship, which it is believed will lead to private sector‐led growth and improve the competitiveness of the African economies (UNDP, 2004).

African agriculture is currently at a crossroads, at which persistent food shortages are compounded by threats from climate change Having been rather neglected for more than two decades, international support to African agricultural development is on the rise and will significantly increase in the coming years. Major policy priorities include : value chain development, market access for the poor, agricultural research and innovation, agricultural intensification and productivity improvement, land and water management, adaptation to climate change, multi-stakeholder collaboration and institutional development supporting sustainable market systems. Since 2003, African institutions, particularly the African Union (UA) and its New Partnership for Africa’s Development (NEPAD) have taken up the challenges through the development and implementation of the Comprehensive Africa Agriculture Development Programme (CAADP).

For many years and until quite recently, agriculture fell out of favor with development practitioners, receiving only 4 percent of official development assistance and 4 percent of public expenditure in sub-Saharan Africa (SSA) (World Development Report [WDR] 2008).

However,as exemplified by the 2008 WDR dedicated to Agriculture for Development, the development community has refocused on agriculture as an effective means of fighting poverty,

Entrepreneurs are widely recognized as the prime movers of economic development; the people who translate ideas into action. Recognizing the prime-mover status of business entrepreneurs, the Kenya Government has implemented a wide-ranging set of strategies to encourage youth to initiate their own small businesses. The major focus for this effort is small enterprise development (SED).

Small enterprise development in Kenya has traditionally involved establishing an enabling environment for small enterprise growth including analysis and adjustments to the regulatory environment that has been a hindrance to prospective small business owners. Formal small enterprise development policy encompasses entrepreneurship development programs under a heading ‘Non-Financial Promotional Programs’ (NFPP).

The other two aspects in SED policy are the provision of responsive small enterprise credit facilities and an examination of gender issues.

Kenya, a country with a significant agricultural sector, is characterized by the existence of many isolated rural areas with limited development resources and many problems that affect their competitiveness. Agricultural cooperatives, located in rural areas of Greece, are a potentially important source of rural development and thus of sustainable rural development

A growing problem of food and nutrition insecurity in Kenya is linked to the disappointing growth of agricultural production. The country has a majority (about 80%) of its population residing in the rural areas where agriculture dominates. Even though the country has generally experienced positive growth in agricultural output over the last four decades, it has experienced serious declines in the agricultural sector in parts of the 1980s and 1990s and has had several periodic food deficits and acute food shortages.

What is clear is that whilst many small business owners perceive themselves as entrepreneurs, running a small business and being an entrepreneur is not the same thing. For Corman and Lussier (1996) managing an organization requires different skills and abilities to those of an entrepreneur. For example, successful long-term operation of a business requires managerial skills, while being an entrepreneur requires innovative skills.

Dollinger (2003) defines entrepreneurship as the creation of innovative economic organization for the

purpose of growth or gain under conditions of risk and uncertainty. The definition however assumes

that all farmers are engaged in farming for financial gain or growth which is not always the case.Social economic and cultural factors which hinder or stimulate the development of entrepreneurial skills by farmers

The popular perception of entrepreneurship is of a heroic individual or an economically successful firm (Cole, 1959; Collins et al., 1964; Schumpeter, 1934).

However, this fundamental attribution error continues to erode in the face of increasing evidence showing that individuals and entrepreneurship are socially embedded in network structures (Aldrich and Zimmer, 1986; Casson and Della Giusta, 2007; Johannisson, 1988) which are situated within a specific cultural context (Hofstede, 2001).

Scholars have long pointed out the importance of socio-cultural factors in the decision to create new businesses, arguing that entrepreneurship is embedded in a social context (Aldrich and Zimmer, 1986).

They argue that entrepreneurial variations are better understood by considering the social environment in which the firm is created, because, in addition to economic activity, entrepreneurship is a social phenomenon (Berger, 1991; Shapero and Sokol, 1982; Steyaert, 2007).

While the economic conditions may explain some of the variation, any convincing explanation must take account of the social and cultural aspects of entrepreneurial activity (Drakopoulou Dodd and Anderson, 2007).

Because societies are endowed by nature with different physical environments, members of society must adopt environmentally relevant patterns of behaviour to achieve success. These environmentally relevant patterns of behaviour lead to the formation of different cultural values in different societies, some of which influence the decision to create new businesses. Thus, culture, as distinct from political, social, technological or economic contexts, has relevance for economic behaviour and entrepreneurship (Shane, 1993; Shapero and Sokol, 1982

McCormick (1996) concurs with Scott and Twomey (1988) on predisposing and triggering factors, and introduces the concept of constraining factors, such as, retrogressive cultural practices, limited finance, little education, limited information and weak markets. Macke and Markely (2003), underscore the importance of readiness factors in the community entrepreneurial behaviour, namely, willingness to invest, leadership team, balancing business attraction, entrepreneurial programmes, openness to entrepreneurship, and beyond the town borders.

Hayton et al. (2002), in their literature review, link culture and entrepreneurship to three broad streams of research. The first focuses on the impact of national culture on aggregate measures of entrepreneurship such as national innovative output or new businesses created. The second stream addresses the association between national culture and the characteristics of individual entrepreneurs. The third explores the impact of national culture on corporate entrepreneurship.

Anthropologists view entrepreneurship as well as other social processes as cultural processes (e.g. Greenfield and Strickon, 1986; Stewart, 1991).

In particular, the important role of norms and traditions has been demonstrated, which, although they generally do not inhibit entrepreneurship, can do so. From an anthropology perspective, attention to social and cultural factors related to the creation of a new business has provided interesting contributions to the understanding of entrepreneurship, especially through the study of social constraints (Garlick, 1971; Kennedy, 1988; Wiewel and Hunter, 1985) and collective approaches (e.g. family business, community-centred business, ethnic or organizational entrepreneurship) to business formation and growth (Benedict, 1968; Davis and Ward, 1990; Kleinberg, 1983; Parker, 1988, among others).

Kallio and Kola (1999) in a study of farmers in Finland attempted to determine what factors gave farmers competitive advantage over other farmers suggest that there are seven characteristics of a successful farm and farmer: Profitable production seemed to be associated with continuous evaluation of production, incomes and expenditures; Constant development of cognitive and professional skills i.e. Continual Professional Development (CPD); They benefit from a positive work ethic; Goal-oriented operation, i.e., the ability to set goals, to reach them and to set new ones; Utilization of recent information that is relevant for the individual farmer’s own circumstances and the needs of the farm; Favourable starting points for the enterprise, meaning good condition of machinery, buildings, land and an appropriate balance between pricing of product and investments in production; Cooperation with others in the supply chain.

(Samad Aghaeei, 2003) in his study is considered the most important barriers of Entrepreneurship included : Labor Law, high rates of insurance, taxes and duties of law, import and export law, banking and monetary regulations, economic insecurity and investment , government intervention in all the country’s economic affairs, foreign relations of severe bureaucracy with other countries. In Research (Javaheri, 2005) were diagnosed familial obstacles, inefficiencies and training systems, coordination role expectations, beliefs, stereotypes and prevailing relations of labor organizations as the most important barriers to Iranian women’s entrepreneurship. in Research (Mirghafori et al, 2009) the barriers affecting women’s entrepreneurship are classified in seven categories family barriers, academic – education, culture, personality, financial, cultural – social and legal. Study results (Buttner, 1997) on U.S. 29 female entrepreneurs, shows that 34% of them have difficulty in attracting investment and financial managemen. In Study of (Sandor, 1999) the most important barriers to women entrepreneurship have been included fear of failure, lack of courage, lack of support, moral support and lack of suitable model. (fray, 1993) the barriers to women’s entrepreneurship has been classified in four formats of physical capital, financial, social and human. (Turnuball et all, 2001; Henderson and Roberston, 1999; Lane, 2002) the most important barriers to students and students in entrepreneurial activities in the UK have considered include lack of financial resources, lack of stress tolerance, inability to work hard and difficult time commitment For them. Based on the model (Zahra, 1993) structures external environment, internal environment and the strategy chosen by the entrepreneur can influence on a business entrepreneur as a catalyst or prevent them.

Agricultural marketing co-operative movement

The legal definitions of

a cooperative vary depending upon the source, but most agree that a traditional cooperative is

one that: (1) provides service at cost; (2) is democratically controlled by its member-patrons;

and (3) limits returns on equity capital (McBride, 1986:93).

The owners of a cooperative are

the same people who have access to the services it offers. Knapp (1962:476) defines a

cooperative as “a special type of business corporation serving those who are at the same time

both owners and users of its services”. Porter and Scully (1987:494) define cooperatives as

“voluntary closed organizations in which the decision-control and risk-bearing functions

repose in the membership, and decision management reposes in the agent (manager), who

represents the principal’s interests”. Le Vay (1983) states that the basic blocks in defining a

cooperative are that it is an association of persons (either individually or institutions) who

work together to achieve certain commercial objectives. According to Rhodes (1983), a

cooperative is a special type of business firm owned and operated for mutual benefit by the

users (member-patrons).

Nilsson (1997) listed the three most common characteristics found in most cooperative definitions, namely: (1) cooperation is an economic activity; (2) it is

conducted for the need of its members; and (3) it is owned and controlled by these members

A traditional cooperative (TC) is an organisation formed by a group of people who meet voluntarily to fulfil mutual economic and social needs through running a democratically controlled enterprise such that the benefits achieved through cooperation are greater than the benefits achieved individually (ICA, 2005).

Some analysts argue that cooperatives have significant potential to contribute towards reducing poverty, enhancing empowerment and creating employment (Barton, 1989; Philip, 2003; Van Niekerk, 1988).

The cooperative movement in Kenya is one of the nationally organized institutions available for all cadres of persons. Its agenda is usually based on locally determined proposals whose aims are to empower citizens to realize their socio-cultural and economic capacities using locally available/generated resources. It is believed that people within a specific geographical or institutional locality have similar perceptions about how to resolve common issues in their lives. Often, cooperative societies bring together various classes of people regardless of their socio-economic status and their agenda would be one only-to share ideas, suggest and implement viable practices that are likely to bring development and uplift economic status of members. The various forums they organize for education purposes are often devoid of political, ideological or socio-cultural emotivism that may derail focus.

In order to deal with the complexities of poverty, the livelihood approach to empowering people seeks to gain an accurate and realistic understanding of people’s strengths (assets or capital endowments) and to discover how they endeavour to convert these into positive livelihood outcomes. Livelihoods include not just income-earning opportunities, but also the capabilities, assets (including both material and social resources) and activities required for a means of living (Chambers & Conway 1992).

They therefore encompass consumption levels; access to assets; embededness in social networks; levels of human capital; and the absence of inequality as well as processes such as resilience, coping and adaptation.

As an integral part of the Government strategy of wealth creation and poverty reduction, cooperatives activity cut across all the sectors of the national economy that include agriculture, finance, housing, transport, building and construction, manufacturing and distribution trade. Cooperative activities concern mainly the financial sector (44%) and the agricultural sector (38%).

The cooperative movement is well structured with more than 11.000 registered Cooperative Societies in 2007. The Kenya National Federation of Co-operatives is the national apex cooperative organization and 8 other National cooperative organizations/institutions are bringing together cooperatives per main activity such as bank, insurance, college, etc. Cooperatives gather at least 7 million members in Kenya.  

The growth and support of cooperatives in Kenya present the possibility of promoting all key objectives of CoopAFRICA:  Establishing an enabling legal and policy environment; enhancing access to support services through Centres of Competence; promoting effective co-ordinating structures; and strengthening the cooperative movement through a Challenge Fund mechanism.

Delgado (1999:165) argues that “Smallholder agriculture is simply too

important to employment, human welfare, and political stability in sub-Saharan Africa to be

either ignored or treated as just another small adjusting sector of a market economy ….”

Governments in less-developed countries have often promoted the use of cooperatives as

organisations that could enhance the development of their small-scale farmers.

Cooperative movements have endured and thrived in many African countries that are still

developing. Most agricultural cooperatives in the developing countries focus more on product

marketing and input supply as opposed to production (Ortmann and King, 2006).

The

introduction of cooperatives to English speaking African countries was based on the

experience gained by the British colonial administration in Asia. African farmers grew crops

such as coffee, cocoa, cotton, peanuts and rice. The British colonial system marked the

enactment of cooperative legislation, which also provided for the establishment of a

cooperative union and the appointment of a Registrar of Cooperative Societies. According to

Machethe (1990), the majority of people in less-developed countries (LDCs) live in the rural

areas and survive on a low income earned through subsistence agriculture. In the case of South

Africa, agricultural cooperatives in the former homelands were generally not successful in

Kenyan farmers are faced with a dynamic global economic and trade environment caused by the

liberalisation of international markets. In addition, there has been a rapid advance in

information and communication technologies (Ortmann, 2005).

The agri-food industry has

been rapidly changing and globalising and, hence, some agricultural cooperatives have

responded by forming subsidiaries co-owned by external investors or opening up their own

societies to investment by non-farmer interests, while other agricultural cooperatives have

demutualised and are investor owned (Birchall, 2004).

Global experiences show that in most cases farmers are determined to keep control of their core business.

Currently, commercial agricultural cooperatives have played a major role in the global market

by forming joint ventures in order to jointly export their products, and continue to serve their

members by looking for growth opportunities and use advanced technology (USDA, 2002).

Cooperative

According to Cook et al. (2008), referring to the definition of collective

entrepreneurship in order to describe innovative forms of agricultural

cooperatives, a collective enterprise “is the process by which investors,

customers or suppliers, plan, finance and establish a business form of collective

action, which aims to win profits by more than one chain of production and

marketing of food and beverages. This format is a historical trend of previous

collective schemes”. This definition explains Alternative Collective Enterprises

(ACE), which emerged through the efforts of people with long experience in

organizing traditional agricultural cooperatives.

Agricultural Cooperatives, as member-owned and controlled agribusiness enterprises

traditionally play an important role in upgrading the socio-economic status of their members and

local Communities. However, in Greece, the majority of Agricultural Cooperatives face severe

financial problems, which undermine their existence. In order to surpass this situation, they have

sought means of enhancing their business dimension using more competitive forms of

collaboration. These include alternative forms of collective entrepreneurship associated with the

transformation of “Traditional Cooperatives” into “New Generation Cooperatives”, which under

appropriate conditions can ensure their development and their members’ welfare.

Agricultural Cooperatives in the EU are an important socio-economic element in

the economy and society. Emanating from the “concern for the local

community” cooperative principle, they are important rural development

operators: Over 50% of share in the supply of agricultural inputs; over 60% of

share in collection, processing and marketing of agricultural products

(COGECA, 2010).

As organizations based on their members, they have their

roots in the countryside and are an excellent example of a partnership form that

can serve simultaneously social, business and environmental objectives in a

synergistic way.

The success of entrepreneurs is influenced by support from others, which can be in the form of formal and

informal support. Formal support comes in the form of financial, technology, and strategic partnerships or

industrial contacts (Carrier et al, 2004).

Informal support may come from personal and community-based

networks (Levent et al., 2003).

For example, in Wong’s (1988) study, Chinese entrepreneurs in Hong Kong

excelled in their businesses due to the practice of ‘familism’, that involves the role of kinship ethnicity, and

territorial background, which brings the entrepreneurs closer to each other, and consequently becomes barriers to

entry for others who are not from the group. Finally, support for entrepreneurs can also come in the form of

mentoring (Cox and Jennings, 1995).

Policy implications Entrepreneurship policy and strategy development

Studies have shown that SMEs in rural areas in the UK (particularly remote rural areas) have outperformed their urban counterparts in terms of employment growth (Keeble et al,1992; Smallbone et al, 1993a).

Behind each of the success stories of rural entrepreneurship there is usually some sort of institutional support. Lu Rongsen(1998), in a study in Western Sichuan highlights the important factors responsible for the rapid development of enterprises in the area. These include- uniqueness of the products in so far as they are based on mountain-specific, local natural resources; development of infrastructure; strong and integrated policy support from government; and a well-planned marketing strategy and link-up with larger companies and organizations for marketing nation-wide and abroad.

According to Petrin (1994), the creation of such an environment starts at the national level with the foundation policies for macro-economic stability and for well-defined property rights as well as international orientation. The policies and programs targeted specifically to the development of entrepreneurship do not differ much with respect to location. In order to realize their entrepreneurial ideas or to grow and sustain in business, they all need access to capital, labor, markets and good management skills. What differs is the availability of markets for other inputs.

The inputs into an entrepreneurial process- capital, management, technology, buildings, communications and transportation infrastructure, distribution channels and skilled labor, tend to be easier to find in urban areas. Professional advice is also hard to come by. Consequently, entrepreneurial behavior, which is essentially the ability to spot unconventional market opportunities, is most lacking in those rural areas where it is most needed i.e., where the scarcity of ‘these other inputs’ is the highest.

Rural entrepreneurship is more likely to flourish in those rural areas where the two approaches to rural development, the ‘bottom up’ and the ‘top down’, complement each other. The ‘top down’ approach gains effectiveness when it is tailored to the local environment that it intends to support. The second prerequisite for the success of rural entrepreneurship, the ‘bottom up’ approach, is that, ownership of the initiative remains in the hands of members of the local community. The regional development agencies that fit both criteria can contribute much to rural development through entrepreneurship.

Piore and Sabel(1984), in their book, “The Second Industrial Divide”, outline a policy framework for small business development, which states that economic development is more likely to succeed if it takes place within a political context, where local communities actively nurture and support small-scale, industrially diverse, flexibly specialized enterprises. Within this context, small business development is one component of a comprehensive economic development strategy comprising both large-scale, mass- production enterprises and small-scale, flexibly specialized production units.

According to a study by Tarling et al (1993), in rural UK, a number of potential weaknesses in the competitiveness of rural firms, in particular certain aspects of the operating environment and the firms’ responses to them have become evident. In this respect, Vaessen and Keeble, (1995), also point out that the external environment in the more remote rural areas particularly, presents challenges for SMEs, which they need to adapt to if they are to survive and grow. These include the limited scale and scope of local market opportunities which make it necessary for firms to be particularly active in developing non-local markets if they are to grow. Another aspect of the external environment in these remote rural areas is the labor market, in which relatively low wage levels in comparison with urban areas combined with qualitative characteristics of the rural labor force (e.g. loyalty to the firm) reduce the incentive for firms to invest in labor saving process innovations, particularly in the more craft-based sectors.

A further characteristic of the remote rural business environment is the lack of a local industrial and service milieu which means that there are fewer opportunities for firms to subcontract out locally than in an urban context. From the point of view of innovation specifically, the low density of the business population results in a small number of potential collaborating firms locally, as well as more sparsely distributed research and development, educational institutions and business support providers compared with some other types of location. This raises questions about the extent to which the characteristics of remote rural environments constrain innovative activity in SMEs; another issue which concerns the implications of these features for the type of policy response that is likely to be effective.

Eco-friendly agricultural development provides an enabling environment for women’s

entrepreneurship. Women have traditionally been mostly confined to small-scale farming. Diversifying

small-scale organic farming can substantially enhance small farmers and promote women’s entrepreneurship

as opposed to large-scale conventional farming. Green cooperatives that operate on a community basis can

be natural places for the extended application of women’s experiences in active community activities.

Cooperatives are an effective means by which small players and the poor can attain economy of

scale in enterprises. As such, cooperative projects are an important instrument for poverty alleviation. The

search for ways to escape poverty and create a better life for one’s self and one’s family are among key

drivers of entrepreneurship. From this motivational standpoint, women are favourably positioned to seek out

and capitalize on cooperative entrepreneurship opportunities for a number of reasons.

Based on the above review we can now conceptualize entrepreneur as a change agent, an innovator who is also a risk

taker, who exploits business opportunities in his environment and utilize resources effectively to develop new

technologies, produces new products and services to maximize his profits and contributing significantly to society’s

development. This definition encompasses the desire of the entrepreneur to maximize profit and contribute to economic

and social well being of the society. It shows the entrepreneur as one who is also imbued with the ability to organize a business venture with the desire to achieve valued goals or results. He is a catalyst of economic or business activities.

It is of interest to note and clarify the concepts of “intrapreneur” which is related to that of entrepreneur. An employee of an existing organization may also be engaged in entrepreneurial activities through innovations and products development according to (Kanter, 1983).

This is the case of an intrapreneur who is capable of initiating change from within in large organizations. Sometimes when such an employee is dissatisfied with the organization because he receives no support to fund and develop new products he may decide to leave and establish a new company to put his ideas into practice. In this case he becomes an entrepreneur, many business have their roots in intrapreneurship. The intrapreneur is therefore an entrepreneur within an already established organization.

Carter and Rosa (1998), McNally (2001) and

Borsch and Forsman (2001) who suggest that the methods used to analyse business

entrepreneurs in other sectors can be applied to farmers. For these authors, farmers have

traditionally been entrepreneurial, indeed Carter and Rosa (1998), argue that farmers are

primarily business owner- managers and that farms can be characterised as businesses. Carter

(1998) draws parallels between portfolio entrepreneurship in non-farm (business) sectors and

farm pluriactivity suggesting that farmers have multiple business interests and these create

employment and rural economic development. Eikeland and Lie (1999) argue that pluriactive

farmers are entrepreneurial, but as Alsos et al (2003) acknowledge ‘there is still a paucity of

knowledge about which factors trigger the start-up of entrepreneurial activities among farmers’.

Skills

Hanf and Muller (1997) suggest that in a dynamic environment with fast technical progress, openminded

farm entrepreneurs will recognise more problems than they are able to rationally solve.

Therefore, the farm entrepreneur has to recognise problems and work with them until decisionmaking

is possible.

Africa –

1. INTRODUCTION

McElwee (2004) farmers are defined as those employed on a part or full time basis in a range of farming activities; they are primarily dependent on the farm and agriculture in the practice of cultivating the soil, growing crops and raising livestock as the main source of income.

Dollinger (2003), entrepreneurship is the creation of an innovative economic organisation (or network of organisations) for the purpose of gain or growth under conditions of risk and uncertainty. This definition, however, assumes that all farmers are engaged in the farm business for financial gain or growth, and clearly this is not the case. According to Gnyawali and Fogel (1994) the entrepreneurial environment can be grouped into five dimensions: 1) government policies and procedures, 2) socio-economic conditions, 3) entrepreneurial and business skills, 4) financial support to businesses, and 5) non-financial support to businesses.

Skills are defined by Wolf & Scharlemmer (2007) as related to tasks and activities. For example, a farmer needs certain skills to be able to deal with customers, grow crops, identify business opportunities etc. Skills can also be developed by learning and experience, excluding traits and personality characteristics. They go further to define Entrepreneurial skills as such qualities that are required to recognize business opportunities and to put them into business practice.

2. LITERATURE RELATED TO THE ECONOMIC, SOCIAL AND CULTURAL FACTORS WHICH HINDER OR STIMULATE THE DEVELOPMENT OF ENTREPRENEURIAL SKILLS, AT THE FARM

• Social Factors

• Culture Factors

• Economic Factors

The economic, social, religious, cultural, and psychological factors affect origination and success of entrepreneurs (Habib, Roni, & Haque, 2005).

The reasons and motivations for starting business or economic activities by the rural women are enormous. The important reasons are earning money or attractive source of income, enjoying better life, availability of loans, favorable government policy, influence of success stories, personal satisfaction, desire to utilize own skill and talents, unfavorable present working environment, self-employment and employment of others, assurance of career and family security, fulfillment of creative urge of the borrowers’ experience in family business, self-confidence, non-ability to find suitable job or work, encouragement and advice of the family members, economic necessity, and so on (Afrin, Islam, & Ahmed 2008).

Much of the research conducted in the 1980s identified business challenges specific to entrepreneurs and some of the difficulties reported included: obtaining start-up funds, financial management, and development of effective marketing and advertising (Pellegrino & Reece, 1982).

The root causes of limited financial success were often attributed to early management practices.

Scholars argue that entrepreneurial variations are better understood by considering the social environment in which the firm is created, because, in addition to economic activity, entrepreneurship is a social phenomenon (Berger, 1991; Shapero and Sokol, 1982; Steyaert, 2007).

While the economic conditions may explain some of the variation, any convincing explanation must take account of the social and cultural aspects of entrepreneurial activity (Drakopoulou Dodd and Anderson, 2007).

More generally, the idea that individuals and organizations affect and are affected by their social context is not new. It is a seminal argument in both classic and contemporary sociology, and the argument has been applied to the study of entrepreneurship at different levels of analysis (Thornton, 1999).

Let us not forget that Weber’s (1930) classic thesis was multi-level – that culture legitimated individualism, which led to economic development. Since it was first stated, Weber’s argument continues to be tested, using various operationalizations of culture, by psychologists (McClelland, 1961), sociologists (Collins, 1997; Delacroix and Nielsen, 2001) and, more recently, by economists (Becker and Woessmann, 2007).

However, identifying and measuring how social and cultural contexts affect individual behaviour is undoubtedly a challenge. Reynolds (1991) for example, suggested that the starting point should be to consider how each person participates in a variety of face-to-face or interpersonal groups for the major domains of life: family, work, political, religious, leisure or recreational, neighbourhood and so forth. In a similar vein, it has been found that entrepreneurs have a wide range of casual contacts (Aldrich and Zimmer, 1986; Birley, 1985), suggesting that a variety of trusted social linkages is an important prerequisite to developing an entrepreneurial idea (Shane, 2000), the decision ‘to be an entrepreneur’ (Reynolds, 1991), and for garnering the resources to start a new business (Shane and Cable, 2002).

In the past, farmers have not needed to raise capital from sources external to the family network. For Gasson (1988) the family is the potential source of risk capital – capital, labour and information. As a consequence, this provided advantages to the farm enterprise. In more recent years, however, the ‘natural inheritance’ of farms has been eroded as a consequence of farmers’ children becoming more mobile and less desirous of remaining in a declining industry. Property prices in villages and rural communities have escalated, which has had the effect of precluding ownership by indigenous community members.

Other uncertainties in the farming industry include unpredictable seasonal climate changes, invasive pests, CAP reform, and labour market changes. Community changes in the rural economy are also becoming more evident, as the sector does not appear to regenerate its ageing population. The lack of younger farmers entering the farm business may well have serious implications for the farm sector.

In a study of the transition of the Dutch agrarian sector, Poot et al. concluded that entrepreneurs who want to diversify nearly always have to deal with obstructions, particularly from law and legislation. An important example of a barrier to diversification is that local development plans of the local government never take account of non-agricultural activities in the agrarian area. Another barrier to diversification is that the legislation around working conditions and food safety frequently causes problems in the combination of care and agriculture. The last important obstruction may be protests and resistance to new developments (McElwee, 2006).

Clearly, the political, social and economic environment is important. For example, Polish agriculture is characterised by a highly fragmented agrarian structure. Small-scale production has a major influence on the functioning and competitiveness of Polish farms and results in high transaction costs and problems with sales (Halicka and Rejman, 2001).

Other farmers continue to run their farm business while taking paid employment, either within the sector (usually as agricultural sub-contractors) or outside the sector.

Interestingly, Sikorska (2001) concluded that the entrepreneurial activities of farmers in Poland are strictly connected with the demand for their services within the neighbourhood locality. She suggested that this means the closer to conurbations a farmer operates, the more activities are undertaken. In this respect the local business environment, access to markets and support facilities appear to be important.

Gasson (1988) also suggests that ‘better-educated farmers are known to make greater use of information, advice and training, to participate more in government schemes and be more proactive in adjusting to change and planning for the future of the business’. Higher levels of education seem to be linked to the characteristics of both farmers and farms, including larger farms and more pluriactive businesses.

1. LITERATURE RELATED TO THE RELEVANCE OF THE CONCEPT OF ENTREPRENEURSHIP TO THE FARM IN ENHANCING THE VALUE CHAIN

• Focus on end products.

• Management of the value chain process.

• Recognition of the importance of relationships within the value chain process.

• Focus of the value chain perspective is on the market system.

The value chain describes the full range of activities which are required to bring a product or service from conception, through the different phases of production (involving a combination of physical transformation and the input of various producer services), delivery to final consumers, and final disposal after use Kaplinsky and Morris (2000).

A ‘value chain’ in agriculture identifies the set of actors and activities that bring a basic agricultural product from production in the field to final consumption, where at each stage value is added to the product. A value chain can be a vertical linking or a network between various independent business organizations and can involve processing, packaging, storage, transport and distribution. The terms “value chain” and “supply chain” are often used interchangeably. FAO, (2005)

Traditional agricultural value chains are generally governed through spot market transactions involving a large number of small retailers and producers. FAO, (2005)

Modern value chains are characterized by vertical coordination, consolidation of the supply base, agro-industrial processing and use of standards throughout the chain. FAO, (2005)

National and international buyers of food products are becoming more concentrated: nearly 40% of the world’s coffee is traded by 4 companies and 80% of Latin American banana exports are controlled by 3 firms. FAO, (2005)

The number and size of modern value chains, and thus jobs, will increase in developing countries with economic growth; already in more prosperous transforming and urbanized countries, the industries and services linked to agricultural value chains often account for over 30% of GDP FAO, (2005)

Modern agricultural value chains usually offer wage and self employment with better pay and working conditions than in traditional agriculture. Although women constitute only 20-30% of agricultural wage workers worldwide (though more in some Latin American and African countries)3, they often predominate in high-value industries for export or domestic supermarkets, such as fresh fruits, vegetables, flowers, poultry and seafood FAO, (2005)

Economic development involves the transformation of rural agricultural based economies into more urban industrial and service based economies.This implies that flows of resources, goods, services, knowledge and information between urban and rural areas change. Entwicklung & Raum(2005)

Value chains describe productive processes around a product from the provision of inputs to production, transportation, transformation, processing, marketing, trading, and retailing to final consumption. Entwicklung & Raum(2005)

Since production only translatesinto income once final consumers really demand and buy goods, the value chain approach encourages looking at the production process from the consumer’s end. Entwicklung & Raum(2005)

The starting point for value chain analysis is usually a participatory chain mapping workshop, in which representatives from all groups involved in the process develop a joint understanding of the respective chain. This exercise reveals strengths and weaknesses of the value chain and serves as a starting point for mutual trust-building. Discussions evolving around input quality, logistic arrangements or product standards often help producers to understand the real demand for their (raw-)product. Listening to processors and consumers can be an eye-opener for producers and traders, when it comes to consumers’ needs, the right quality, the right quantities at the right time in the right place. Entwicklung & Raum(2005)

Analyzing the chain jointly can demystify a number of negative perceptions, such as «middlemen exploit us», or «farmers always break the contracts». Pointing out the weaknesses in the chain can help shaping the roles of public and private institutions to improve chain efficiency and to gain competitiveness. In the case of internationally traded products, e.g. fresh fruit and vegetables, following the value chain is the only way to fully depict the complex chain linkages, flows of resources, knowledge and logistics. Entwicklung & Raum(2005)

Secondly, the metaphor of the chain emphasizes the fact that most goods are produced by a sequence of interlinked actors and activities. The approach focuses on the analysis of the institutional arrangements that link the various economic players (i.e. trust, vertical and horizontal integration and organization, and contracts).

Entwicklung & Raum(2005)

Thirdly, it highlights the importance of private sector development. For the purpose of fostering agricultural growth and aligning the agricultural sector development with urban and other trends in society, it provides a fairly holistic framework, which can encompass a number of different development activities. Entwicklung & Raum(2005)

The relevance of entrepreneurship can be associated with the aim of survival of farms. Entrepreneurship is relevant because the farmers need to find ways to adapt their businesses to the changing situation. Second, the relevance of entrepreneurship may be associated with the idea that the ongoing changes embody, open up or create new opportunities for farm businesses, rather than simply narrowing down or removing previous operational conditions Bryant (1989).

Rudmann(2008) says that some reflections of the wider structural changes are already visible at the level of farm businesses: farms are decreasing in number, while many of the remaining farms are seeking cost-effectiveness through enlargement of the scale of production or through cost reduction. Further, strategic orientations on farms are becoming more diverse: in addition to those that focus on conventional primary production, many farms add value to agricultural products through processing, direct sales and niche products, or have diversified their activities on the farm into non-agricultural businesses. Farmers are applying competitive strategies, and to be successful in this is – at least to a certain degree – a matter of skills. Rudmann(2008)

2. LITERATURE RELATED TO DETERMINE FACTORS THAT FACILITATE THE ADOPTION OF ENTREPRENEURIAL SKILLS FOR FARMERS

Rurality is viewed as a dynamic entrepreneurial resource that shapes both opportunities and constraints. Location, natural resources, and the landscape, social capital, rural governance, business and social networks, as well as information and communication technologies, exert dynamic and complex influences on entrepreneurial activity in rural areas (Stathopoulou, Demetrios, & Dimitris, 2004).

Rural entrepreneurship is a key to economic development in many countries across the globe (OECD, 1998, 2003; UN 2004).

It is one of the newest areas of research in the entrepreneurship field and has become one of the significant supportive factors for rural economic development and agribusiness.

The reasons and motivations for starting business or economic activities by the rural women are enormous. The important reasons are earning money or attractive source of income, enjoying better life, availability of loans, favorable government policy, influence of success stories, personal satisfaction, desire to utilize own skill and talents, unfavorable present working environment, self-employment and employment of others, assurance of career and family security, fulfillment of creative urge of the borrowers’ experience in family business, self-confidence, non-ability to find suitable job or work, encouragement and advice of the family members, economic necessity, and so on (Afrin, Islam, & Ahmed 2008).

In general, researchers have found that men start their businesses primarily as a result of such ‘pull’ factors as the opportunity to work independently, to have greater control over one’s work, and to earn more money (Shane et al., 1991; Shapero, 1975).

There is a lesser influence from such ‘push’ factors as limited advancement opportunities, job frustration, and avoiding an unreasonable boss or unsafe working conditions (Routamaa, Hautala, & Rissanen, 2004).

Shane et al. (1991), studied non-US entrepreneurs, including women, and reported that the male entrepreneurs were most motivated by the need to improve their positions in society for themselves and their families, while the female entrepreneurs were most motivated by the need for achievement.

de Lauweres study (ibid) of weaknesses in entrepreneurship selected seven critical success factors: management and strategic planning, ecosystem, staff, chain perspective, craftsmanship, search and learning behaviour and personal characteristics. de Lauwere goes on to suggest that the individuality of the entrepreneur can influence its entrepreneurship showed that it is possible to distinguish two groups labelled: ‘traditional growers’ ‘new growers’.

3. LITERATURE RELATED TO STRATEGIES AND TOOLS USED TO IMPROVE ADOPTION OF ENTREPRENEURIAL SKILLS AT THE FARM.

• Seminars

• Self assessment tools for the farmers.

• Formal trainings on business skills.

4. LITERATURE RELATED TO WHICH ENTREPRENURAL SKILLS ARE CONSIDERED RELEVANT BY THE FARMERS FOR AGRICULTURAL DEVELOPMENT

• Professional Skills.

• Managements Skills.

• Opportunity Skills.

• Strategic Skills.

• Cooperation/ Networking Skills

The environment in which agricultural entrepreneurs operate is constantly changing and developing, as farmers adapt to the vagaries of the market, changing consumer habits, enhanced environmental regulations and so on. Running an enterprise successfully in this dynamic setting requires substantial tangible resources, such as physical or financial capital. Besides material assets, the success of the enterprise is also dependent on the more intangible resources embedded in the enterprise, such as entrepreneurial capital. It is recognised that in markets characterised by dynamic change some entrepreneurs become alert and develop knowledge, making (deliberate) information investments that others do not (Busenitz et al., 2004).

it has also been argued that instead of entrepreneurship the most essential challenge for farmers is to abandon the productivistic, or Fordist, model of production. Michael Winter (1997), for example, suggests that there is a need for farmers to unlearn productivist ways of thinking and acting, and instead to learn new skills and knowledge concerning the environmentally friendly and sustainable management of farms. He considers entrepreneurship and innovations in farm businesses as well, but ends up rejecting these by claiming that the ‘focus on the individual agent of change and on personal creativity is inadequate, not least because creativity and innovation are historically and socially contingent’ (1997, 373)

it seems evident that entrepreneurship is widely assumed to be a highly appropriate requirement in the current farm context. For example, Swedish economist Rolf Olsson made a sound prediction in 1988 when he wrote that, ‘Managerial and entrepreneurial skills of the farmers are going to play increasingly important role in future developments in agriculture both at the farm level and in the agricultural sector as a whole’.

According to the results of the expert interviews in the pilot stage of the ESoF project (de Wolf & Schoorlemmer 2007), it is a widely shared view among experts that the changing environment of farms at present necessitates that farmers must develop their farm business and business activities in economic terms, in order to survive and be successful.

de Wolf & Schoorlemmer (2007) state that while professional skills and managements skills are basic requirements for farmers, opportunity skills, strategic skills and cooperation/ networking skills can be viewed as proper entrepreneurial skills. Thus, studying entrepreneurial skills does not imply that other skills are assumed to be irrelevant or not important.

According to Rudmann(2008) theoretical elaboration, entrepreneurial skills are to be understood as higher level skills. They have to do with establishing, running and developing a business enterprise. In such business activities several types of lower level skills are needed, corresponding to the tasks of production, administration, marketing and so on. These may be referred to as technical, professional or managerial skills. However, entrepreneurial skills may be conceptually differentiated from all these as meta-level skills that touch the whole process of initiation, steering and developing a business (Vesala 2008).

Rudmann(2008) suggests that it is warranted to view entrepreneurial skills as a hierarchical construct, where the pursuit of opportunities may be viewed as a key entrepreneurial skill that covers the core tasks in entrepreneurship, and represents the ‘top of the pyramid’ of the hierarchy of entrepreneurial skills.

Man et al., (2002) categorized entrepreneurial competences in six key areas of related competences. The key clusters are opportunity, relationship, conceptual, organizing, and strategic and commitment competences. In the literature on competence profiles of entrepreneurs and managers, several competences that meet the outlined criteria and fit in one these six clusters can be recognized (Erkkilä, 2000; Hoekstra and Van Sluijs, 1999, Van den Tillaart, 1987, Man et al., 2002; Onstenk, 2003; Mulder, 2001; McClelland, 1987).

Opportunity competences can be described as competences related to recognizing and developing market opportunities through various means. Underlying competences of opportunity mentioned in literature (based on Erkkilä, 2000; Hoekstra and Van Sluijs, 1999, Van den Tillaart, 1987, Man et al., 2002; Onstenk, 2003; Mulder, 2001; McClelland, 1987) are general awareness, international orientation and market orientation.

In a recent review on entrepreneurship research Busenitz et al., (2003) conclude that research at the boundary of constructs of individuals, opportunities, modes of organizing and the environment will present important areas for entrepreneurship research.

Bolliger et al. (2005) uses the term management skills as the complete package of skills that a farmer would use in order to develop the farm business.

For de Lauwere, the scope of management and strategic planning is based on a score of fourteen factors: objectives, purpose driven, business planning, sale increases, formulation of policy, information about management, time strategy, measuring of performances, social orientation, growth orientation, certificates, aims for certificates, financially conservative and concerns about the future.

Vermeulen and van der Lans (2002) found that entrepreneurs should pay more attention to strategic planning. Duczkowska-Małysz (1993) found that the entrepreneurial skills of farmers are mostly depending on their spouses’ preferences. The more open to change are the spouses the more willing are the farmers themselves to take risk.

5. CONCEPTUAL FRAMEWORK

INDIPENDENT VARIABLE

|The Economic, Social And Cultural Factors|

|MODERATOR VARIABLE |

| |

|Importance of The concept of |

|entrepreneurship to the farm in |

|enhancing the value chain. |

|factors that facilitate the adoption of | |

|entrepreneurial skills for farmers | |

|How Farmers themselves can improve |

|their entrepreneurial skills. |

|Strategies and tools for improving |

|improve adoption of entrepreneurial |

|skills. |

6. GAPS IN THE LITERATURE REVIEW.

There is little publication on impact of professional and network skills on agriculture development especially about agriculture in Africa. Though a lot of informal survey have been done on the subject its mainly focused to Europe and North America.

7. OPERALIZATION OF THE VARIABLE

|VARIABLE |SOURCE |TYPE OF INFORMATION |DATA COLLECTION |MEASURING SCALE |ANALYSIS |

|Importance of The concept of entrepreneurship to |FARMERS AND LENDING |To identify the |Questionnaire and |Ordinal |Qualitative |

|the farm in enhancing the value chain. |INSTITUTIONS AND |types of management |interview | | |

| |MINISTRY OF AGRICULTURE|skills that are | | | |

| |EXTENSION OFFICERS |relevant to the | | | |

| | |agricultural sector | | | |

| | |and how they could | | | |

| | |be enhanced. | | | |

|Factors that facilitate the adoption of |FARMERS,LENDING |To determine the |Questionnaire and |Ordinal |Qualitative |

|entrepreneurial skills for farmers |INSTITUTIONS AND |types of opportunity|interview | | |

| |MINISTRY OF AGRICULTURE|skills and there | | | |

| |EXTENSION OFFICERS |relevance to the | | | |

| | |farmers and other | | | |

| | |stakeholders. | | | |

|How Farmers themselves can improve their |FARMERS, LENDING |To determine the |Questionnaire and |Ordinal |Qualitative |

|entrepreneurial skills. |INSTITUTIONS AND |types of strategic |interview | | |

| |MINISTRY OF AGRICULTURE|skills and there | | | |

| |EXTENSION OFFICERS |relevance to the | | | |

| | |farmers and other | | | |

| | |stakeholders. | | | |

|Strategies and tools for improving improve |FARMERS, MARKETING |Identify the role of|Questionnaire and |Ordinal |Qualitative |

|adoption of entrepreneurial skills. |AGENCIES AND MINISTRY |Co-operation/ |interview | | |

| |OF AGRICULTURE |Networking Skills to| | | |

| |EXTENSION OFFICERS |farmers and the | | | |

| | |market in general | | | |

| | | | | | | |

| | | | | | | |

| | | | | | | |

| | | | | | | |

| | | | | | | |

|Generation of information for| | | | | |Support Required to up-scale|

|formulation of key policy and| | | | | |and out-scale the |

|programmatic actions for | | | | | |horticultural technologies |

|enhanced action of successful| | | | | |at the uptake stage |

|technologies | | | | | | |

| | | |Identification and documentation of | | | |

| | | |technologies addressing key productivity | | | |

| | | |constraints in the horticultural value | | | |

| | | |chain in Kenya | | | |

| | | | | | | |

| | | |- Institutions, | | | |

| | | |- Technologies, | | | |

| | | |- Drivers of Technology, | | | |

| | | |- Stages (pipeline, uptake, adopted) of | | | |

| | | |technologies, | | | |

| | | |- Location of technology and entry point | | | |

| | | |in horticultural value chain, | | | |

| | | |-Target in the value chain, | | | |

| | | |- Methodology, | | | |

| | | |- Actors (both public and private), | | | |

| | | |- Successful horticultural technologies, | | | |

| | | |- Funding sources, | | | |

| | | |- Donor objectives, | | | |

| | | |- Duration of project and exit strategy | | | |

| | | | | | | |

Figure 3: Conceptual framework of the study (source – author)

CHAPTER THREE

STUDY FINDINGS

3.1 Overview of horticultural pro

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AGRICULTURE DEVELOPMENT

Extraneous variables

Horticultural Technology Data collection Approach/Methodology