Networking of Co-op Institutes in HRD (1995)

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   This document has been made available in electronic format
           by the International Co-operative Alliance.
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                     Paper presented to the 
          ICA Co-operative Research Forum in Manchester
                    17 and 18 September 1995

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            NETWORKING OF COOPERATIVE INSTITUTIONS
                IN HUMAN RESOURCE DEVELOPMENT
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              Dr. Gabriele Ullrich, ILO

Contents
       1.    Introduction

       2.    Elements of networking in cooperative HRD
             2.1    Institutional diversity
             2.2    Cooperation and competition for higher
                    competitiveness
             2.3    Self-evaluation and self-monitoring versus
                    supervision

       3.    External support to networking

       4.    Anticipated problems of networking

       5.    Expected results of networking in cooperative HRD


1.     Introduction

The World Bank's Development Report, 1991, devoted one chapter
to the theme "Investing in People".  The chapter ends by saying:
"The evidence shows that investing in people makes sense not just
in human terms, but also in hard-headed economic terms".1/ 
Although this truth might sound trivial to people who are
involved in human resource development, it was reassuring to read
that in times when the World Bank was known for their emphasis
on the economic requirements for structural adjustment
programmes. The subject was then elaborated by the United Nations
Development Programme's human development reports which entered
step by step into the minds of persons dealing with economic
development and growth at micro and macro levels.  This applies
to industrialized and developing countries as well as to
economies in transition.  Human capital is in general accumulated
by education and training on the one hand and by experience in
productive activities ("learning by doing") on the other hand.2/

In successful cooperative movements the subject is known since
their foundation. The relevance of human resource development
(HRD) for the economic survival of cooperatives is well
recognized and often said to be a factor which can partly
compensate for the lack of other productive factors such as
capital and land. The importance of "intellectual capital" is
today even recognized by important international companies. "The
challenge is to create and intelligent organization that is able
to continually renew itself as the speed of changes in the
environment accelerates."3/

The extended concept of HRD which goes beyond the conventional
approach of cooperative education and training, includes various
elements.  One of these elements is information.  The flow of
information inside the cooperative as well as from and to the
outside of the cooperative in undoubtedly is decisive for the
economic performance of the cooperative. In principle it is
argued 4/ that the cooperative can have comparative advantages
by lowering the transaction costs for their members. A major part
of the transaction costs consists in information costs.
Information as a means of HRD contributes to developing a
personnel infrastructure without which privatization or in
general adjustment processes are not conceivable 5/. Against this
background the question arises for cooperatives in the modern
society of information and information techniques how the flow
of information can be structured and operated to lead to best
possible results.

The conventional approach of cooperative structures of a two tier
or three tier system does nowadays neither always satisfy needs
for information and other services in HRD of the individual
cooperative who has to struggle for economic survival, nor the
information needs of secondary cooperatives or training
institutions.  They might need information from other forms of
organizations and enterprises or from the cooperative settings
in other countries or regions.  The information flow might be
needed in other channels and directions as foreseen in these
structures.  In the field of HRD the federative system might have
to be replaced or at least to be supplemented by networking. 
I do not wish to enter the extensive discussion of the future of
federative systems or the federative principles 6/, however, in
regard to human resource development one might arrive at reverse
conclusions than in regard to business activities of federations. 
In the latter case there seems to be a tendency in industrialized
countries towards more hierarchical structures and less
democratic control from within the federative system (no matter
whether the power lies in the central institution, a regional
federation or in the stronger primary cooperatives).  In the area
of HRD, particularly in developing countries and economies in
transition, cooperative institutions might have to restrict
themselves to offer to the primary cooperatives the absolute
necessary services which are not available or not affordable "at
the market" (according to the principle of subsidiarity).  Where
the primary cooperatives cannot obtain the services and
information "from the market", the HRD institutions have to
mobilize them through various alliances with various
institutions. This might be called networking.
This paper tries to describe and analyse how this is done,
illustrated by some examples, and how such efforts can be
supported externally.  The experiences of the ILO-COOPNET 7/
programme will be used here for such illustration.

2.     Elements of networking in cooperative HRD

Networking has become a magic word in various areas and in
various senses. It can be understood in a wide range of senses,
from electronic networking to political and institutional
lobbying.  In the context of this paper it shall be used in its
organizational sense and should be distinguished from the word
"network".

Networks are created among independent institutions which want
to keep their independence and have at the same time established
contacts and exchange with similar institutions at national,
regional and interregional level. These structures are
consequently neither vertical nor horizontal, they are
interlinked at various, even changing levels.  Examples are
INCOTEC (the ICA International Cooperative Training and Education
Committee) and the regional HRD networks of the ICA, or the FAO-
supported NEDAC (Network for the Development of Agricultural
Cooperatives) in Asia and more recently RADEC-COOP (Reseau
d'Appui du Dveloppment des Capacits pour les Coopratives) in
West Africa. Such networks have mostly established statutes,
secretariats and other organizational attributes.  

Networking can be considered as a more loose form of cooperation,
it can be, e.g., ad hoc, not regular, on changing subject
matters, among changing institutions, groups, persons who might
have only few points in common.  Networking can also take place
between networks.

What are the elements of networking in cooperative HRD?  What are
the advantages and what are the possibilities of external
promotion?

       2.1   Institutional diversity

The object of networking cooperative HRD is the exchange of
information and expertise.  The networking cooperative
institutions try to keep contact with every possible and relevant
programme, organization, or enterprises which have to offer
something in relation to cooperative HRD.  The networking is not
limited to education and training institutions and not only to
cooperative institutions. A lot can nowadays also be taken up
from big companies which tend to introduce team approaches in
management. This diversity of contacts corresponds to the variety
of situations in which cooperative HRD takes place.  Depending
on the country, the HRD system in general, especially the
vocational training system and the career period of the persons
in question, cooperative HRD takes place in schools, training
institutions, at the workplace or in general public.  

The instruments of cooperative HRD are:

* classroom training: the classical form of education and
training is today enriched with a large variety of methods to
mobilize the participation and the creativity of the trainees in
order to enable them to problem solving in their future work
life;

* practical exercises in groups: classroom training is today
usually supplemented by a number of exercises which simulate real
work life situations such as planning games, play roles, field
visits with exercises under guidance and computer simulations;

* cooperative management consultancy services: they developed out
of cooperative extension services of cooperative departments or
of auditing services of cooperative apex organizations and aim
at strengthening the entrepreneurial culture of cooperatives.
They are mostly provided through visits and training;

* information and supervision at the workplace: this approach is
in most European cooperative movements a traditional, integral
part of the personnel structure of cooperative. It takes place
as a life long learning process through the help of the
supervisors (themselves being trained for this). The management
information system is of decisive importance for the HRD of the
cooperative staff, office bearers and members;

* public media: the awareness creation and information of the
general public and therewith of potential members turned out
again nowadays to be crucial, especially in those countries in
Central and Eastern Europe and in the developing regions where
the cooperative idea got discredited by the abuse of the word
cooperative for other types of undertakings. 

The ILO-COOPNET programme is encouraging its partners to exchange
information and expertise regarding all these instruments of
cooperative HRD.

       2.2   Cooperation and competition for higher competitiveness

Despite the historic experience of successful cooperative
movements cooperative HRD has quite frequently been considered
to be a luxury in times of scarce resources and not vital for
cooperative survival.  Although this opinion was strongly
contested by cooperative training institutions and even by more
business-oriented parties in the cooperative movements. However,
the duplication of activities by cooperative HRD institutions
cannot be afforded any more.  Furthermore, the quality of the
training has to be practical and has to correspond to modern
business requirements.  

Competitors of yesterday at national, regional and international
levels have to become networking partners with complementary
activities, programmes and materials.  The existing offer of
knowledge, expertise, materials, methods, and information also
in non-cooperative business areas has to be explored before
investments are made into the development of new approaches.
Examples of such networking efforts were done within the
activities of COOPNET, INCOTEC, IRED and recently RADEC-COOP.
However, they have demonstrated that efficient networking
requires also conditions in regard to know-how, skills, attitude
and material support which have to be activated before networking
becomes efficient.  Contrary to more institutionalized
structures, networking and also networks maintain the advantages
of competition and the challenge for innovations among
independent institutions, but yet they encourage cooperation with
their well known effects of strengthened efforts.

       2.3   Self-monitoring and self-evaluation versus supervision

The know how, skills and attitudes for networking are usually
developed through "learning by doing". There are, however, some
elements which can be identified by analysing the experiences
gained so far.

Networking partners have to join efforts by creating mechanisms
of monitoring and ongoing evaluation, involving as many actors
as possible.  

Monitoring means an ongoing stock taking of activities, methods,
persons and institutions involved, training materials, financial
inputs, etc.  This may seem to be trivial, however, in most cases
of HRD institutions this is not systematically done and if it is
done, it is not accessible for others or not timely accessible.

Ongoing evaluation is understood as a continuous analysis of the
implemented activities, their achievements and the lessons
learned.  The results of the analysis have to be systematized and
can hence serve as the basis to revising the planning and
implementation of new activities.  

This develops slowly into an ongoing process of "rolling"
planning, implementation, monitoring, ongoing evaluation, plan
revision etc.  The impact of the activities on more general
achievements of cooperatives like income, employment, living
conditions of the members and the needs have to be assessed in
a similar way, possibly in a rhythm of longer cycles.  In
cooperative HRD it is apparent that the stock-taking, analysis,
plan revision, needs and impact assessment have to involve all
persons concerned: the planners, the trainers and consultants,
the target group of HRD, the promoters of HRD programmes and
others who have a bearing on the HRD activity and its impact. 
Their involvement in the process may have to be ensured through
various means and in various situations such as questionnaires,
group discussions and outside appraisals. Participatory
monitoring and ongoing evaluation can then lead to self-
evaluation which is crucial for capacity building and "learning
by doing".

The specifics of networking in relation to such processes are the
willingness and the capacity of the participating institutions
and structure to share.  They are ready to share information, to
share activities and to share trust.  The sharing of information
has to take place according to certain standardized, comparable,
agreed upon procedures.  The use of available computer software
(e.g. Microsoft Project) has been of considerable value in the
case of COOPNET for the processing of information in stock taking
and evaluation, but also for plan revision and impact assessment. 

In such an arrangement for sharing of information through agreed
upon procedures supervision should become redundant as it is
replaced by the agreed upon networking and the consequent
competitive and synergetic effects.  As in a cooperative, the
sharing of trust creates a social control which is sufficient to
identify those with whom the cooperation or the networking will
be maintained. "Formal" networks might have the disadvantage that
they may also include and serve institutions which are not
actively involved in the three types of sharing. In this respect
they are similar to federative systems.  The sharing of
activities of networking partners will reinforce their coherence.
One type of activity are meetings of the partners.  More
effective, however, may be the cooperation in innovative areas
of HRD (in order to share lessons learned) or the exchange of
trainers and consultants (to share expertise) and the joint
development of training materials (to share existing experience).

3.     External support to networking

In the past a number of technical assistance programmes and
projects for developing countries created through their
activities national, regional and interregional networks for
cooperative HRD. The largest of these experiences may have been
the MATCOM network (in about 60 countries). Similar experiences
were certainly also made in other programmes such as the GACOPEA
programme. Shortly after the closing of the interregional MATCOM
project in Vienna, due to the withdrawal of the donors and
despite of the positive final evaluation of the project, the
network started to deteriorate. As the ILO Cooperative Branch had
no resources left to support the activities of the network
(except of West Africa), the services for MATCOM were limited to
some basic information and the distribution of MATCOM materials.
For the subsequent ILO activities in the area of cooperative HRD
under the umbrella of COOPNET the criteria applied for the
selection of activities were based on the lessons learned from
these experiences. 

COOPNET, an interregional ILO service programme financed by
DANIDA (Danish International Development Agency) is consequently
designed according to the programme approach which replaces
slowly the traditional project approach of technical assistance.
It supports activities of existing institutions and networks. The
donor provides the funds according to a framework of objectives
and themes in the area of cooperative HRD. The allocations are
provided yearly on the basis of a "rolling workplan and reporting
system". The framework is conceived for four years. The spending
of the funds or the "delivery" does, for example, not take place
according to a workplan developed at the beginning of the project
for a period of 3-4 years, but according to the capacity of the
development partners to design and implement their own
activities. The result of such traditional approach is mostly
outdated plans when it comes to their implementation which have
then either to be enforced on the collaborating institutions or
implemented by the project itself. The consequence is usually the
non-sustainability of the activities. The workplan of COOPNET is
designed for 6 months with a "forecast" of another 6 months. The
criteria for the selection of activities to be supported are:

* the assistance to be provided shall facilitate networking among
HRD institutions, i.e. the programme does generally not initiate
or implement activities but promotes the cooperation among
existing institutions;

* the activities supported shall lead to an improved capacity of
the institution in question to develop similar activities in
future itself, i.e. capacity building;

* the activities supported shall have a chance to develop into
a sustainable programme of the institution in question; i.e.
sustainability.

The themes around which activities are supported are HRD policies
with a special focus on gender and environmental issues, training
methods and training materials, the promotion of cooperative
entrepreneurship as well as training needs and impact assessment.

After the two first years of operations it turned out to be of
utmost importance that the activities be developed through the
development partners and that the donor is willing to allocate
the funds on the basis of a general framework for the activities.
The participatory monitoring and the ongoing evaluation which
includes as many partners as possible is strengthened through
interregional working sessions of a consultative group which
includes the main development partners (such as ICA and the
International Institute Histadrut). Impact assessment of the
activities has still to be developed in a more systematic form,
however, it could only be executed through the development
partners. 

4.     Anticipated problems of networking

Federative systems of cooperatives (sometimes also called
federative networks) have to cope with divergent interests
between its member cooperatives. Depending on the economic
performance of these primary or secondary cooperatives, the
decision making might be too long and ineffective to service
cooperatives in critical economic situations. In a number of
industrialized countries such divergent interests have led the
collapse of federative systems. Are the effects of networking
even worse? It might be worthwhile to have a closer look at
networking and its effects.

The criticisms of networking are similar to those attributed to
any form of participation and cooperation:

... too slow to quickly produce visible results which makes
networking inefficient?

The results of investment in HRD are neither quick nor very
visible. The effects of cooperative HRD might be even slower as
more persons have to be involved into the HRD process. For the
measurement of the impact of investment in HRD only few methods
and little experience are available. As The Economist put it:
"Economic theory suggests that better human capital is an
important resource of growth. Measuring it is devilishly
difficult". 8/ Recently some bigger companies started to
supplement their financial reports with information on their
human capital 9/. The question raised here, concerns, however,
the fact whether networking can bring additional results in
cooperative HRD compared to individual activities. The efficiency
could only be measured by the input that the partners afford for
the networking in relation to the increase in the quality and
quantity of their own training offer. Such measurements have not
yet been undertaken. However, one can assume that in the initial
stage of creating trust and of starting joint activities, the
input is bigger than in later stages.  Afterwards the expertise
and materials of other institutions will definitely improve the
quality of HRD of the individual institution. Stability of the
institutions and persons cooperating with each other will further
increase the efficiency. Nevertheless, it should also be born in
mind that in learning processes the own experience is only
replaceable to a certain extent by other peoples experience.
Adaptation processes could create partially such own experience.
Through such processes which are in general slow, it is expected
that HRD becomes more sustainable.

... too participatory which prevents networking from arriving at
decisions?

In the area of cooperative HRD networking consists of the
exchange of information as well as of expertise and training
materials. The decisions to be taken from the side of the
"offering networker" are: What information should be provided and
what activities are to be shared? On the other hand the
"requesting networker" has to decide: What information is needed?
in what time? and in which activities can we participate? On this
basis the networking partners can decide whether they wish to
take closer contact or whether they initiate their own,
individual activities. The speed of the information flow can be
increased by modern technologies, especially by electronic
networking. The networking partners do not take part in the
decision making of the HRD institution in question. Their
participation is an offer which is not binding for others.
However, it increases the diversity and therewith the quality of
HRD possibilities. The conclusion for this argument is that the
decision making process in the area of HRD is not slowed down.
At the same time the networking and the involvement of more
people in the subject matter increases the commitment of the
persons concerned who are reassured in their undertakings. 

... too demanding in regard to the qualifications of the actors
who have to understand the whole system of networking and any
operation within the system?

Everybody who has experienced any form of networking (e.g. the
ICA Research Committee's' work) knows how overwhelming the amount
of information, subjects and institutions is in the beginning.
After continuous exchange and shared activities, however, certain
themes and concerns crystallise around teams of persons and
institutions. In the COOPNET Programme we identified five major
themes around which the networking partners started to group (see
paragraph 2.4). Networking is indeed demanding of the actors,
however, more in the sense that they must be ready for ongoing
evaluation, sharing and eventually adapting their own HRD
activities to creative diversity. This, however, is likely to
improve the quality of their offers. Networking is admittedly a
challenge, but it contributes in any event to the development of
understanding.

Although the criticisms may appear valid at first glance, the
critical aspects do also guarantee sustainability, commitment and
development of understanding.

5.   Expected results of networking in cooperative HRD

In times of a fast changing environment and adjustment at the
macro and micro levels, new structures may already be overruled
before they are put into operation.  Therefore, the creation of
new structures must nowadays make sure that they have a built-in
mechanism to renew and reform themselves from the inside. 
Networks seem under certain conditions very appropriate for such
on-going renewal. "Networks learn faster than bureaucracies and
form an better structure for an intelligent organization that has
the capability to quickly recombine and reconceptualize its
mental models to add value for its stakeholders." 10/  The
structures of the future seem to be:  small, light, flexible,
open, accessible and closely monitored by the actors. That does,
however, not mean to return to the small village cooperative and
the small regional cooperative college which did everything
themselves, including their finance. It does not mean that the
mergers in the past were vain and that small structures could
survive by themselves. It is more advocating small units which
develop their particular offer in cooperative HRD and by this
become competitive in the "HRD market". On the other hand,
through interlinkages with networking partners they increase
their competence and fill in gaps in their training offers by
drawing on the offers of other institutions. The integration into
a cooperative federative system only would reduce these effects
and make the HRD institution dependent on the economic situation
of the federative system. 

Networks may not be able nor desirable to replace the federative
systems of cooperatives which are needed to achieve the
advantages of large-scale organizations as advocated in the ICA
principle of cooperation among cooperatives. Nevertheless, in the
area of cooperative HRD they can strengthen the interlinkages
among various levels by shortcutting information flows, while
maintaining the advantages of local, personal involvement.


Notes
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1/  The World Bank: World Development Report 1991, The Challenge
of Development, Washington, 1991, p. 69.

2/  Hemmer H.-R.: Wirtschaftsprobleme der Entwicklungslnder,
Mnchen, 1988, pp. 269-270.

3/  International Cooperative and Mutual Insurance Federation
(ICMIF): Newsletter NETWORK, Special Edition, August 1995, p. 1.

4/  Rpke, J.: Cooperative Entrepreneurship, Marburg 1992, pp.
29-31.

5/  Wagner, H.: Wachstum und Entwicklung, Mnchen 1993, p. 228.

6/  For this discussion see e.g. Brazda, J. and Schediwy, R.:
Lessons from the recent collapse of various federative systems
of cooperatives, Paper presented at the ICA Research Committee's
Meeting in Cracow, 1994.

7/  COOPNET: ILO/DANIDA Programme on Human Resource Development
for Cooperative Management and Networking.

8/  The Economist, 24 June 1995, p. 89.

9/  ICMIF Newsletter NETWORK, p. 2-4.

10/ ICMIF, Newsletter NETWORK, op. cit. p. 2.