Innovation Value Chain

“We innovate by starting with the customer and working backwards. That becomes the touchstone of how we invent.” – Jeff Bezos

We are welcoming the Fourth Industrial Revolution (4IR) as I wrote about earlier. On the backdrop of this, in the last at least five (5) years we’ve observed a series of technological startups keen on dominating the market in Kenya. From a video clip I recently watched, it’s hailed that Africa is the hotbed of innovations and with a global focus on social impact, it’s Africa that has enough problems to be solved while making substantial money. This is the goal but as most people venture into this space, the trend has been to develop digital platforms and solutions with a good narrative but limited context with the actual market to be served. Part of the problem in this space has been financial constraints where young people conceptualize their solution, apply IT skills to develop a product and try bringing it to market hoping it’ll make them money. Unfortunately, most of these have suffered an untimely demise. This was center of a discussion we had on Monday with the director for Production & Innovation in one of the universities in the country.

Why is it that the innovation value chain and ecosystem is unforgiving to most young people even though they come to place with creative solutions? For those innovations that get the funding necessary especially in the agribusiness space, most which have been designed as market linkage and e-commerce platforms have failed within the initial two to three years of operation. In retrospect, some of the critical constraints that these solutions have had revolves around working with the target users of the solution and bridging the market as should be while creating value in the ecosystem. I’ll give a case of a digital platform that’s designed to link farmers in Turkana who is to be linked with market in Nairobi or any other metropolitan with the requisite demand for goat meat. When this solution comes to market, the probable angle is to have a broker in Turkana who buys goats locally at a cheap price then leverages on the solution to make a kill. What happens is that the farmers over time get demoralized and stop farming at scale. This then affects supply but because the innovator doesn’t have access to the target beneficiary, they observe decline in activity over time until they can’t sustain operation anymore. In other cases, the innovation focuses on offering a market to products that do not exist.

In order to streamline and improve efficiencies in the innovation value chain, there’s need to invest in innovation ecosystem support & product value chain strengthening. With the bushmeat market estimated to be worth $247million in Ghana in 1997, there was a systematic plan to invest in the sector. This was through innovation support and streamlined value chain improvements in the Ghanaian greater cane rat market opening up the entire value chain from rearing, slaughtering, processing and sale This was made possible through investment in a semi-autonomous innovation hub that focused on optimizing the value chain, supporting innovators and focusing on the value add of each of the processes to ensure optimal results. These are some of the solutions I have a feeling can help is addressing the perennial challenges we face in African countries other than constant and persistent appeal for aid. Strengthening an innovation value chain serves an investment portfolio for investors while driving economic & social development concurrently.

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