21 September 2012
REEP
A Process Model for Developing and Implementing
Collectively owned enterprises in rural areas
(AgriSETA Workshop: Premier Hotel O.R. Tambo)
Zandile Ndaba
Senior Manager
INTRODUCTION
This process model initiative referenced Empowerment and Equity as its fundamental drivers to
develop an all encompassing integrated process model that addresses the many challenges faced by
many community based enterprises. This model has been labeled the Rural Enterprise Empowerment
Process (REEP)
The REEP model provides a comprehensive reference point to support facilitators and others in
addressing the complex problem-solving and decision-making challenges that face project managers
and facilitators . It enables facilitation of the development of sustainable rural enterprises in a way
that also leads to effective empowerment of the communities involved.
An integrated modeling approach enables a facilitator to be an effective change agent by:
•
Assisting rural communities to choose practical solutions to their problems
•
Attracting potential investors through the promotion of cost-reducing economies of scale, and
•
Adopting a systematically supported, programmatic approach.
DEVELOPMENT PHASES
The three broad development phases that an enterprise/project should pass through are defined as
follows:
•
Mobilisation (of the community and the business)
•
Enterprise development
•
Transfer and transformation
Within each of these phases, a number of activities take place and thus a number of criteria must be
met before the project can progress to the next phase.
•
Mobilisation:
This comprises two aspects, mobilisation of the community and mobilisation of the business (strategic
and business planning, preparation of guidelines for enterprise development and signing of Memoranda
of Understanding).
•
Enterprise Development:
The model provides a step by step guide for implementation of the enterprise, highlighting key stages
such as securing all necessary authorisations for compliance with all legislation, establishing the legal
entity for the operation of the enterprise and securing financial resources for implementation including
technical support, infrastructure and equipment.
•
Transfer and Transformation:
The transition and transformation stage provides a guide to achieving a transfer of equity and benefits
to the community that reflects the change in their contribution to the enterprise as they are
empowered and develop capacity and skills.
MOBILISATION
COMMUNITY MOBILISATION
BUSINESS PLAN DEVELOPMENT
ASSESS ECONOMIC VIABILITY
EMPOWERMENT
DEVELOP ENTERPRISE CRITERIA
ENTERPRISE DEVELOPMENT
(IMPLEMENTATION)
Markets
Ownership
Social plan etc
ESTABLISH LEGAL ENTITY
SECURE FINANCE
SECURE MARKETS
DEVELOP SKILLS
TECHNOLOGY & EQUIPMENT
Interventions Required?
TRANFER &
TRANSFORMATION
ENTERPRISE OPERATIONALISED
CAPACITY & SKILLS TRANSFER
TRANSFER EQUITY
EQUITABLE BENEFIT SHARING
CPPP Exit
Checklist for the Mobilisation Phase (community and
business)
Outcomes/criteria
Have appraised initial business idea
Have assessed availability/sustainability of resource
Have met with community group (they are found to be committed)
Have met with Tribal authority to discuss concept and have sufficient buy-in
Have met with general community and have sufficient buy-in
Have determined that the group has secure access to the resource
Business Plan is completed and project is found to be viable, or solutions identified to make it
viable
All post Business Plan entry criteria are met
Appropriate legal entity or entities are in place (with respect to both the focus group and
overarching community structure, where appropriate)
Contracts/agreements signed between program and the community
Memoranda of Understanding have been signed with any partners that have been identified at
this stage.
ACHIEVED
Outcomes/criteria
Finances secured
Skills audit conducted and skills gaps identified
Gaps addressed (through training and/or identification of partners)
Contracts signed between partners defining roles and responsibilities
Necessary technologies/equipment sourced
Sources of inputs identified
Primary production established
Markets secured
Appropriate partners identified if required (and agreements formalised)
Critical mass achieved
A sustainable enterprise has been initiated
Achieved
CHECK LIST FOR THE TRANSFERE AND TRANSFORMATION
PHASE
Outcomes/criteria
The community partner has been capacitated with necessary skills (technical, business,
The community partner is sufficiently empowered.
Where partnerships exist, equity has been transferred to the community partner.
Distribution of benefits reflects empowerment and the transfer of equity.
Achieved
EMPOWERMENT
Empowerment is an ongoing process that must be ‘built in’ to every aspect and phase of the enterprise
in order to ensure that there is appropriate capacitation of the community partner in order that they
may share equitably in the benefits generated through the enterprise. This empowerment will need to
be realized through a range of direct and indirect activities that will include:
•
Ongoing mentorship by facilitators
•
Active participation of community members in planning, decision making and implementation
•
The transfer of responsibilities and power
•
The preparation and implementation of a social plan that addresses empowerment interventions
and leadership development training being made available to community leaders and participants
MOBILISATION
START
CPPP EXIT
STRATEGY
END
INTELLECTUAL
PROP.
MARKET
RESOURCE
CHALLENGES
COMMUNITY
REDISTRIBUTION
OF BENEFITS
Compliance with
CPPP entry criteria NO
YES
COMMUNITY
MOBILISATION
F
BUSINESS
MOBILISATION
NO
EMPOWERMENT
& SKILLS TRANSFER
NO
F
YES
TRANSFER
OF EQUITY
SOCIAL
PLAN
YES
TRANSFER &
TRANSFORMATION
Revision of Social
& Business Plan
NO
PREPARATION
OF SOCIAL PLAN
SUSTAINABLE
ENTERPRISE
GUIDELINES FOR
ENTERPRISE DEV.
& SIGN MOUs
INTERVENTIONS:
POTENTIAL
PARTNERS?
ENTERPRISE
DEVELOPMENT
LEGAL ENTITY
AUTHORIZATION
NO
F
YES
F
NO
FINANCE
YES
F
NO
SKILLS
YES
F
NO
NO
INFRASTRUCTURE
YES
F
NO
OPTIMAL
PRODUCTION
& OPERATION?
ENTERPRISE
OPERATIONALISED
(PRIMARY PROD)
The mobilisation phase incorporates:
•A guide to identifying and reviewing the enterprise opportunity. For example an enterprise for rural
empowerment could be based on one or more of the following opportunities:
-
Natural resource base opportunity
Intellectual property or indigenous knowledge owned by a community
A market opportunity
A resource of community entrepreneurs (individual or group)
The specific key variable in each case will vary from project to project or sector to sector.
•In the case of compliance, a guide is provided for the steps of community mobilisation and
assessment of economic viability of the enterprise.
EXIT CRITERIA: SUCCESS SCENARIO
Criteria
Good social capital and sustainable social plan in place:
Balanced and sustainable partnerships
Ownership has been transferred to a capacitated community
partner
Empowered community partner with appropriate equity in
enterprise
Ongoing skills and capacity transfer to community partner.
•
•
•
•
Enterprise is economically and socially sustainable
Enterprise is generating sufficient profits for all partners on a regular basis.
Equitable distribution of benefits.
Suitable partnerships have been established:
Do not require any more facilitation to resolve conflicts
Partnerships are equitable.
•
•
The community partner is sufficiently empowered to manage the enterprise
and meet its responsibilities
Are they met?
FAILURE SCENARIO
If any of the following scenarios emerged, it is likely that facilitation would have to terminate its
involvement in the project:
•Sustainable markets cannot be secured.
•Economic viability cannot be achieved and the project is not profitable (i.e. it cannot evolve from
startup into rapid growth & maturity phases).
•Key inputs cannot be secured (options exhausted).
•Unresolved conflicts - facilitation cannot resolve inter- or intra-partnership disputes on equity and
benefit distribution.
•Partners are failing to meet their roles and responsibilities, to the extent that the project cannot
proceed.

In the process model, exit points were identified at the following stages:
•
Revision of the BP has not allowed the identification of changes that would make the project
economically viable.
•
An appropriate legal entity cannot be identified/established.
•
Financial support cannot be obtained.
•
Necessary skills are not present and cannot be sourced.
•
Successful enterprise development has not taken place.
EXIT CRITERIA: FAILURE SCENARIO
Situations
Sustainable markets cannot be secured.
Economic viability cannot be achieved and the project is not profitable.
Key inputs cannot be secured (options exhausted).
Unresolved conflicts that facilitation cannot resolve.
Partners are failing to meet their roles and responsibilities.
Exit points identified in the process model:
An appropriate legal entity cannot be identified/established.
Financial support cannot be obtained.
Revision of the BP has not allowed the identification of changes that
would make the project economically viable.
Necessary skills are not present and cannot be sourced.
Successful enterprise development has not taken place.
•
•
•
•
•
Are they met?
Conclusion
The focus of this model therefore is to ensure that the `enterprise vehicle’ is sustainable from a
business perspective and a community empowerment perspective. Empowerment is an ongoing
process from mobilization to exit, and is implicit in all stages of the establishment of the enterprise.
Only then can the promise of equity and real wealth creation be fulfilled.
The role of the private sector partner is recognised as most critical to the sustainability of the
enterprise. In particular, the private sector partner should represent access to markets, value
addition opportunities, mentoring and technical know-how.
THANK YOU