training and business development services

From Training to BDS and Back?

Since the 1990s a number of key donor agencies developed a more market-driven approach to provision of training. This was a result of the negative assessments of both impact and cost of state training provision, declining aid budgets and increasing emphasis on the private sector in all areas of development policy.

By the end of the 1990s training increasingly became only one part, and often a minor part, of market-led Business Development Services (BDS). In most large donor agencies funding for training rapidly declined as explicitly poverty targeted enterprise and livelihood support came to focus on minimalist micro-finance. Enterprise-based training in both formal and informal sectors was to be provided through greater private sector involvement to increase both market relevance and cost recovery.

However skills training for livelihood diversification of the very poor can be extremely effective in poverty reduction, particularly for women. Parallel to 'mainstream' debates about the best mix of subsidised and market approaches, there have been many small-scale project-level innovations in poverty-targeted training methods and content, particularly in female-targeted projects. Despite evidence of their effectiveness, these innovations have so far been marginal in donor-level debates and also funding. These recent small-scale innovations deserve much greater consideration and funding in any serious and coherent livelihood development strategy for pro-poor growth.

What are Business Development Services?

Market-led BDS have been important in increasing the focus on demand-led services, participatory training methods, long term sustainability and institutional collaboration. They include:

• Improving Market Access
• Input Supply
• Infrastructure
• Technology and Product Development
• Training and Technical Assistance
• Alternative Financing Mechanisms
• Policy Advocacy

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BDS Limitations

However current policies for BDS threaten to further marginalise and disadvantage the very poor because:

• the focus on cost recovery and short-term financial sustainability means that services are generally outside the payment capacity of the very poor.
• reliance on market solutions presumes sufficient providers to constitute a competitive market to improve quality and push down costs to clients.
• little has been done to counter discriminatory policies.
• there has been little attention to livelihood development programmes explicitly for the very poor.
• 'trickle-down' is assumed rather than strategically planned and assessed.

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Framework for Pro-Poor Livelihood Training: Current Innovations

Current innovations which have had a significant contribution to livelihood development for poor women and men have included:

• Participatory methods which focus on participant bottom-up learning rather than top-down 'expert' training and which are accessible to illiterate people.

• Integrated training: integration of literacy, life skills, gender awareness and empowerment into livelihood and entrepreneurship training.

• Integrated programme strategies including micro-finance, marketing support, organizational strategies and macrolevel advocacy.

• Sectoral strategies targeting different levels of particular economic sectors: employees, outworkers and upstream enterprises as part of an integrated pro-poor sectoral approach in these sectors.

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