The document discusses the concept of VUCA (volatility, uncertainty, complexity, and ambiguity) and how it describes the current business environment of constant unpredictable change. It then focuses on how agricultural cooperatives are facing challenges due to globalization and increased competition. Specifically, cooperatives struggle with limited access to finance, weak governance, and outdated information systems. The document advocates for computerizing cooperatives to improve information processing and decision making. It also discusses the important role of cooperatives in supporting small farmers and the work of FAO to help establish enabling environments for cooperatives.

1. VUCA: Cooperatives Preparing to
Face Competition
Jo Balucanag Bitonio
Associate Professor
IGPS - LNU

2. VUCA stands for volatility, uncertainty, complexity, and ambiguity. It
describes the situation of constant, unpredictable change that is now
the norm in certain industries and areas of the business world. VUCA
demands that you avoid traditional, outdated approaches to
management and leadership, and day-to-day working.

3. • VUCA is an acronym coined in 1987, based on
the leadership theories of Warren Bennis and
Burt Nanus, to describe or to reflect on the
volatility, uncertainty, complexity and
ambiguity of general conditions and situations.
• The US Army War College introduced the
concept of VUCA to describe the more volatile,
uncertain, complex and ambiguous multilateral
world perceived as resulting from the end of the
Cold War.

4. • Volatility is the dynamic rate of change. As the pace of our world increases,
what we need to do to be effective in it is constantly changing.
• Uncertainty is the lack of predictability and information. It is the “fog of
war” we face. While it would be nice to have clarity on what to do, we
rarely know what our customers want and what our competitors are doing
and how they will respond.
• Complexity describes interdependent systems that do not have apparent
cause and effect. Your company, your clients, and even your competitors
comprise a system that interacts with each other, but for which many of
the relationships can’t be seen or well understood.
• Ambiguity acknowledges the challenge we have in understanding and
assessing reality. It is hard to know what is going on and what we need to
do to improve it.

5. • More frequent use and discussion of the term
"VUCA" began from 2002 and derives from
this acronym from military education.[ It has
subsequently taken root in emerging ideas
in strategic leadership that apply in a wide
range of organizations, from for-profit
corporations to education.
• For a couple of years, the notion of "VUCA" is
gaining popularity as a term to cover the
various dimensions of this ‘uncontrollable’
environment.

6. Coops Preparing to Face
Competition
• On the face of it, agricultural cooperatives
seem well-placed to occupy an important
place in the new economic situation.
According to ICA, virtually all Sweden's
dairy production is marketed by farmer-
owned cooperatives; in Norway, 75 per cent
of forest products are processed and
marketed by cooperatives; in Italy, 60 per
cent of wine is cooperatively produced.
Fourteen farmer-owned cooperatives in the
USA are among the 500 largest
corporations and no fewer than 8 of the 10
largest Canadian firms are cooperatives.

7. • Cooperatives have specific challenges
of globalization. In some areas,
cooperative challenges have been
solved. Critical issues such as the use of
foreign raw materials and production
abroad are now a part of business
development in several large
cooperatives. Globalization is one of
the greatest strategic challenges for
agricultural cooperatives.

8. • Agricultural cooperatives in developing regions
are being hit from all sides. They are receiving far
less support from government than they have in
the past, and with the liberalization of agricultural
markets, many of them are struggling to survive
in an increasingly competitive business
environment. Member services are declining and
farmers are leaving. The world is changing and
these changes tend to favor small, decentralized
organizations that are able to respond rapidly to
the ever shifting demands of the market

9. If agricultural cooperatives are to survive, they
must learn how to compete. One obstacle to
achieving this is that information-processing in
farmer cooperatives in developing countries is
notoriously slow; most large cooperatives still
operate with manual or semi-manual accounting
systems. Such systems are labor intensive to
maintain, leave plenty of occasions for errors and
create opportunities for abuse. It is difficult for
managers to be competitive when they must work
with outdated or inaccurate information

10. What are the main problem for Agri coops?
• According to the Food and Agriculture
Organization (FAO), cooperatives play a
crucial role in supporting small agricultural
producers and marginalized groups such as
young people and women. They empower
their members economically and socially, and
create sustainable rural employment through
business models that are resilient to
economic and environmental. However,
coops may face challenges such as limited
access to finance, weak governance
structures, inadequate management skills
and poor infrastructures.

11. • Agri coops emerge as a result of
farmers coming together bringing their
resources together in mutual effort to
solve their numerous problems. To
strengthen agri coops the CDA must
help farmers obtain adequate and
sufficient loans/credit they need in their
production, Calling on institutions
whether public of private to help in
supplying the farmers needs like
subsidies, grants and other assistance

12. Computerizing Agricultural Cooperatives
The immediate advantage that
computerization brings is the
enhanced ability to handle large
amounts of information. The
introduction of modern information
and communications technologies
(ICTs) in cooperatives can
significantly improve results: they can
facilitate the collection, analysis,
storage and reporting of information
much faster and more accurately
than could be accomplished using
manual systems.

13. FAO: Building Partnerships with Cooperatives and
Producer Organizations
In order to be fully productive, small farmers, fisher
folk, livestock keepers and forest users in
developing countries are in need of services that
are often lacking in rural areas. Cooperatives and
producer organizations provide an array of
services ranging from:
1) Enhancing access to and management of
natural resources;
2) Accessing input and output markets;
3) Improving access to information and
knowledge;
4) Facilitating small producers’ participation
in policy-making processes

14. FAO works with cooperatives and producer
organizations by:
• Supporting the establishment of an enabling environment, which
includes assisting member governments to develop appropriate
regulatory and legal frameworks, a conducive investment climate
and consultation frameworks for policy-related dialogues which
actively involve cooperatives and producer organizations;
• Enhancing their effective participation in policy dialogue processes
to advocate for their members’ needs, making their voice heard at
the national, regional and global level;
• Facilitating the development of producers’ capacities, including
their technical, managerial, organizational and marketing skills, as
well as their ability to integrate into value chains and networks, and
to influence policy-and decision-making processes; and
• Sharing knowledge in the form of publications, learning training
modules, briefing notes and good practices.

15. References
• Managing in a VUCA World - Thriving in Turbulent Times (mindtools.com)
• Enabling Agricultural Cooperatives: A paradigm shift for economic and social inclusion –
YouTube
• Computerizing Agricultural Cooperatives: A Practical Guide (rfilc.org)
• VUCA – Volatility, Uncertainty, Complexity and Ambiguity (pmi.org)
• Cooperatives: has their time come - or gone? (fao.org)
• Agricultural cooperatives and globalization: A challenge in future? (fao.org)