Ateneo de Zamboanga University

School of Management and Accountancy

STRATEGIC MANAGEMENT

CARE KENYA
Written Analysis of the Case

Ahalul, Areej A.
Lakbao, Abdillasis S.
Magpantay, Ana Ruth J.
Musa, Yarah A.
Reyes, Kaitlynne Therese A.
BSLM – IV

August 2, 2018
I – Synopsis

Kenya has the largest economy in East Africa however 55.4 per cent of the population or 17.1
million people lived below the extreme poverty line. Life expectancy at birth was 45 years while
the adult literacy rate was 84 per cent. The Kibwezi region was particularly poor ans vulnerable
to economic and climate fluctuations. More than 70 per cent of the region’s 900,000 population
did not have secure access to food. Most people relied in the assistance from the government and
development agencies and lack economic means to climb out of poverty. Kibwezi could not
attarct inverstors because of its poor infrastructures and electricity, low access to rual services
and weather conditions.

CARE is a non-political, non-religous global network of humanitarian organizations committed

to fighting poverty founded in 1946, in the wake of the Second World War. CARE operated in
Kenya and their development strategy evolves over time and had agrigultural projects in Kenya.
CARE Kenya aimed to make the farmers sell their goods and enter the forrmal economy, so
CARE established the Rural Enterprise and Agribusiness Promotion (REAP) Project – a
market-driven horticultural project targetting small irrigation farmers living below the poverty
line in Kibwezi. The project intended to answer the question: can a market-driven , smallholder
agriculture model be commercially viable and demonstrate impact?

CARE established a consultancy called the Central Management Unit (CMU) which gives
farmers credits to lease block of land and assigned group of 20-30 farmers to parcels of land
called the Production Units (PU). REAP had partnered and engaged with other private sectors.
The REAP Project had been a success as it pulled farmers out of the poverty line however,Cmu
had never been profitable. REAP faced perfomance-related issues as farmers did not meet their
targets.

II – Problem Statement

How should REAP solve the performace-related issues of the farmers so that the CMU becomes
profitable and to make the market-driven model be commercially viable?

III – Objectives
 To know why smallholders were not performing well and what caused the performance
problems
 To motivate the farmers for high performance
 To make the CMU profitable
 To make the REAP commercially viable
IV – Areas of Consideration

Personal point of view:

The farmers in Kibwezi has become too dependent on the support of the government and
other development agencies which led to low performance. This will greatly affect the REAP
Project. The problem is not due to the model but lack of farmers’ motivation to work.

The CARE’s point of view:

REAP failed to be commercially viable. It had been unable to choose the right clients and
staffs, or to modify its bureaucratic systems to be more like a business and less like a non-
governmental organization. A business should focus operations on effficiency rather than just
effectiveness. REAP must be self-sustainable and should not be reliant to donors and grants for it
is intended to be profitable so that farmers may be sustainable at their own without being too
dependent on CARE.

Customers’ point of view:

There is a changing market demand which makes it a threat as well opportuunity. The
customers especially the overseas market demands vary from times to time and the farmers may
not be able to meet these demand due to weather and climate conditions. It is also vulnerable to
economic fluctuations as well as exchange rates.

Stakeholders point of view:

CARE has a good reputation for excellent community engagement and mobilization
which attracts private and governmental partners to work with CARE and REAP had human
resources so the partners will have the opportunity to outsource. They see the REAP as a
successful project. However, if CMU continue to incur debts absorbed by REAP and which
make CARE liable, the stakeholders and partners may pull out. The donors has the possibility to
withdraw their commitment with CARE, and if this happens REAP would run out of fund.

V – Alternative Courses of Action

1. Provide agribusiness training for farmers to educate how it works.

Advantage(s): Enhanced skills of farmers.
Will relatively increase perfomance.
Disadvantage(s): Does not ensure farmers attendance.
Generates additional cost.

2. Offer health benefits for farmers.

Advantage(s): Secured health benefits for farmers.
 May motivate the farmers.
Disadvantage(s): Additional cost.
Will make the farmers more dependent on CARE.

3. Implement a reward scheme for the farmers based on attendance and performance by
giving recognition as with gift rewards.
Advantages: Win-win situation of farmers and CMU.
Creates the idea “Work hard, earn reward.”
Motivates the farmers to work and ensures attendance.
Work hard and high performance leads to greater income. Greater
income enables farmers to pay their loans to CMU.
Disadvantage(s): May lead to unhealthy competition.

VI – Recommendation

We recommend the third alternative course of action for REAP to implement a reward
scheme for the farmers based on attendance and performance by giving recognition as
with gift rewards because it creates a driving motivation for the farmers to work hard and
earn reward. We see it as an effective solution to motivate the farmers to work harder and
achieve their targets so that they will be able to pay their credits to the CMU. Further, the
farmers will be given recognition value and will feel that they are valued by CARE. They
will feel like an asset, thus would make them work harder.

VII – Conclusion

VIII – Action Plan

Action Resources Time Allocated Person In charge

IX – Potential Problem Analysis