虽然拙劣,但这让我第一次摸到了consultant工作的过程,方法,亲历了一次完整的过程直到出结论,还是实际的,在去海滩的路上,我在重新梳理着整个工作的过程,从最开始的field trip走出去收集最grassroot一层的信息,到回到办公室后,第一次汇集手上的第一手信息,编制assessment sheet,后面就是我最佩服Nadine能耐的时候了,迅速一个工作的关系网便打开了,去找谁要什么样的信息,当然其中要有不懈的坚持,信息中涉及HR, Financial budget, government law, project management, internal function and external resource.我简直瞠目结舌…这是多大的一摊,没处下嘴.然后像糊纸一样一遍遍去推进内容的深入和精确,改善完备(这个像写PS)我不确定2年后的我会不会这样的experienced,由此引发新的想法,哥大ESP的MPA是有必要的,先去看情况再做定夺吧

The National Co-operative Council of Sri Lanka

and

the Co-operative Movement

Assessment Report and Discussion Paper

May 2008

Dr. S. Agarwal

Ms. C. Guan

Drs. N.M. Schenk

Overview

This discussion paper has been established by 3 trainees who have spent between 7 and 12 weeks at the National Co-operative Council of Sri Lanka (NCC). On request of the Board of Directors of the NCC we have summarized our observations, views and findings regarding the co-operative movement and the NCC in this discussion paper.

Problem analysis

• Many co-operatives are not profitable; they have not been able to adjust to the open market circumstance due to a lack of management and leadership skills, lack of strategic planning, lack of capital and strong government involvement.
• Many co-operatives are not functioning in accordance to co-operatives’ values and principles; there are few competitive services and benefits for members and assessing member needs and assisting members are not always priorities. Some co-operatives are more run like a business than a co-operative.
• Not all DCCs are functioning well and reaching out to their members due to lack of financial resources and management skills. If DCCs are not functioning well, the NCC has no means to assess what goes on at the grassroots level. In turn, it also makes it harder for the co-operatives to see what the NCC does.
• Currently, the NCC is not able to meet all its objectives satisfactorily due to lack of capital, human resources, management and leadership skills and lack of strategic planning. The NCC is not able to sustain itself. It highly focuses on obtaining foreign funding rather than assessing how the existing funds are being spent.

Suggested solutions 

• NCC has to reset its priorities if it wants to address these problems and achieve its objectives. By shifting priorities, money can be released from the existing budget to make the suggested changes.
• A business plan has to be developed in order to become self sustainable and to generate capital. In stead of focusing on obtaining foreign funding the NCC should develop its business opportunities in order to become self sustainable and to generate capital.
• The NCC has to develop a strategic development plan of how it will achieve its objectives. This strategic development plan has to be developed in cooperation with NCC members and staff and should include the following issues:

• Increase human resources and hire middle management
• Update education and training syllabus according to co-operatives’ needs
• Lobby the government for much needed legislative change
• Create a knowledge share platform for co-operatives
• Establish better communication with and among membership and co-operatives through newsletters or magazines
• Develop projects according to co-operatives’ and their members’ needs.

• Through these changes and the forthcoming SCC project “Strengthening the Capacities of Co-operative Societies in Sri Lanka”, the NCC will be able to sustain itself and to adequately assist the co-operatives to become profitable and to function in accordance to co-operative values and principles.

Introduction

This discussion paper has been established by 3 trainees who have spent between 7 and 12 weeks at the National Co-operative Council of Sri Lanka (NCC). During this time we visited 11 co-operatives in the districts of Batticaloa, Nuwara Eliya and Anuradhapura. And we have spoken to people within the NCC, people within the National Institute for Co-operatives Development and representatives of District Co-operative Councils (DCC) and Provincial Departments of Co-operative Development. On request of the Board of Directors of the NCC we have described our observation, views and recommendation in this discussion paper. The starting point of our work was the notion of the NCC that some of its members were loosing confidence in the co-operative movement at large and the NCC in specific. We have questioned various co-operatives about their functioning, their needs and their expectations from the co-operative movement and the NCC. Our time here in Sri Lanka is limited and our sample size is perhaps not large enough to make generalized statements on the co-operative movement at large. However, within the data we collected we identified various trends and concerns. We have compared these findings with previous studies conducted by the International Co-operative Alliance (ICA) and the Swedish Co-operative Centre (SCC). We have also examined the functioning of the NCC and have collated the opinions and views of various stakeholders about the NCC. We hope this discussion paper will lead to a critical and constructive discussion within the NCC and the co-operative movement. In this way, we hope to contribute to the development of the co-operative movement in Sri Lanka.

Assessment of visited co-operatives

From the 26^th of March until the 8^th of April, we have visited 6 Multi Purpose Co-operative Societies (MPCSs), 5 Single Purpose Co-operative Societies (SPCSs) and representative of the District Co-operative Council as well as the Provincial Department of Co-operative Development in the districts of Batticaloa, Nuwara Eliya and Anuradhapura. We have questioned the co-operatives about their functioning in terms of profitability as well as their ability to function according to co-operatives values and principles. We have also questioned the co-operatives about what would be needed for them to make their co-operative function better. The cooperation between co-operatives, DCCs and the NCC was also discussed. Lastly, we asked the co-operatives if they were aware of their members’ needs and what these needs are. 

Co-operatives’ functioning

Profitability

Out of the 6 visited MPCSs, 4 are running at a loss. One MPCS a well as the 5 SPCSs indicated that they were able to sustain the co-operative, but that they were not generating enough capital through their business ventures to invest in current or new business ventures, or to satisfactorily assist their members.

The main reason the co-operatives gave for the fact that they were not profitable, is that they have not been able to compete in the open market environment. One reason why they haven’t been able to adjust to the open market conditions is a lack of management and leadership skills at the management level of these co-operatives. During the years after the opened economy, the co-operatives never developed a strategy plan of how to adjust to the new circumstances.

       Due to the fact that some co-operatives are not profitable, they do not have access to capital to invest in current and new business ventures. For instance, due to the lack of capital, co-operatives cannot buy stock for the co-op cities in bulk and in cash. As a result prices in these co-op cities are higher than those in the private market. The unprofitable co-operatives also indicated that they currently have too many employees who are not adequately trained for their jobs. Due the lack of capital and human resource strategies, the co-operatives have not invested in their human capital; very few employees have received training. These co-operatives further indicate that they are not able to reduce their staff due to strict and protective labor laws in the Co-operative Employees’ Commission Laws and Regulations. Some co-operatives also indicated that they are afraid of the social stigma that would accompany firing staff.

       Many respondents also stated that the current Co-operative Societies Law is a constraint to the functioning of their co-operatives. The Co-operative Societies Law for instance states that certain decisions made by the co-operatives have to be approved by the Commissioner of Co-operative Development (CCD, formerly named the Register of Co-operative Society). This includes decisions on the sales and purchase of mobile and immobile assets worth more than R 5.000, and decisions on the allocation of profits and surpluses. It can take considerable time for the CCD to decide, which prevents the co-operatives from responding adequately to changes in the markets, and decreases the co-operatives’ ability to grasp opportunities. Furthermore, the CCD has the right to dissolve the Board of Director of a co-operative in his/her district that is not functioning well. Through these regulations, the government still has considerable control over the functioning of co-operatives.

       Some MPCSs also criticize the government’s Samurdhi program, they claim that the compensation they get from the government to execute this program is not enough to meet the costs. Also, the government buys the goods used for the Samurdhi program from the co-operatives, but the government itself determines the price they are willing to pay. In result, co-operatives are sometimes forced to buy crops from their members at lower prices than those in the private market. This creates dissatisfaction among the members and the members in return are not always willing to sell their products to the co-operative.

Many co-operatives have not been able to adjust from the previous institutionally supported and privileged position provided by the socialist government to a proper functioning in the open market economy. The fact that many co-operatives are not able to compete in the open market has also been raised by previous studies and surveys, for instance the ICA study conducted by Mr. R.B. Rajaguru in 1996 titled: “Survival in the Open Market, A Critical Study on the Co-operative Movement of Sri Lanka within the Market Economy”[1]. It has also been identified by the Swedish Co-operative Centre, which is launching a project to strengthen the capacities of co-operative societies in Sri Lanka, in order to address this problem.

Co-operative values and principles

Profitability and meeting co-operative values and principles to some extent go hand in hand. The cooperatives that are not profitable and self sustainable, are unable to provide competitive services to their members. In turn, many members don’t see the benefits of their membership and loose interest.

       When it comes to the members’ (economic) participation the smaller co-operatives we visited have higher membership participation. They are also better able to express member needs when asked. The larger co-operatives we visited have lower membership participation. Among these co-operatives there is a big difference between the total number of members and the number of active members. The majority of these co-operatives were unaware of their members’ needs. At some co-operatives it seemed that member needs was not a priority. Only two co-operatives have monthly meetings during which members can express their concerns, needs and problems. The rest of the co-operatives only have annual meetings with the general body during which the members can express their opinions, concerns and needs.

       However, the co-operatives do provide certain services and benefits to their members. Of the 11 visited co-operatives, 7 co-operatives provide loans to their members at favorable interest rates. It must be stated that members have to meet certain requirement to obtain a loan and that not all members are eligible for loans. Other services to members include funeral services, a children’s savings fund, providing data on agricultural market prices, medical programs, providing school books to children of members, discounts on co-op hospitals and the co-op hotel and conducting community service projects like cleaning temple sites. Only two co-operatives provide training and education courses to their members. None of the visited co-operatives gave second payments to the members that sold their crops to the co-operatives. Two co-operatives indicated that they used to do this but that they were not making enough profit to distribute among their members.

       In terms of democratic control, all co-operatives have democratic mechanism to elect the Board of Directors of the co-operatives. But only one co-operative indicated that they have a system in which 3 members check all transactions on co-operative bank accounts in order to prevent misuse of public money. Women are underrepresented in the Board of Directors as well as in management positions. Some co-operatives have women groups to support and assist women in their society.

Lack of capital is a constraint when it comes to setting up projects and services in order to meet member needs. Many co-operatives have large numbers of inactive members, who have lost interest in their membership. Not all co-operatives have regular interaction and consultation with their members due to which the co-operatives are not aware of their members’ needs. But what is more concerning, not all co-operatives see meeting their members’ needs as an important feature of a co-operative. Some co-operatives are more run like a business and are more focused on making profit than on meeting member needs or operating in accordance with co-operative values and principles. 

Co-operatives needs

The majority of the co-operatives indicated that in order to function better they needed more training and education for their management as well as their staff. The co-operatives’ training needs included training programs in management, leadership, computer skills, accounting, business planning and strategy.

       Lack of capital is a big constraint to co-operatives that want to set up new business ventures. This problem can only be addressed when the co-operatives generate more capital themselves through their existing business ventures, or if they can get access to extra funding or loans.       

       The co-operatives also indicated that they would like to receive more guidance and assistance when they are faced with certain challenges. Often they feel that there is no one to turn to for information or assistance.

       Another major constraint that has to be addressed according to the co-operatives is the current Co-operative Societies Law. The strict regulations of this Law prevent the co-operatives from responding quickly and adequately to changes in their environment. Legislative changes are needed to ensure the co-operatives’ autonomy and independence.

Cooperation between co-operatives, DCC and NCC

When asked about the cooperation among the co-operatives, the visited co-operatives indicated that few co-operatives are working together on common projects or business ventures. Currently, little knowledge and examples of good practices are shared among the co-operatives, there is no institutionalized platform for the exchange of this kind of knowledge.

       According to the respondents, many DCCs are not functioning well and not meeting their objectives due to inadequate financial resources and insufficient skilled personnel. As a result, the DCCs are not able to assist the co-operatives properly. The DCCs are an additional layer between the individual co-operatives and the NCC. Due to this structure, there is no direct communication between the NCC and the co-operatives. As a result, the co-operatives do not always see what the NCC does. In turn, the NCC is not directly in touch with the grassroots level, making it harder for the NCC to identify the issues and problems affecting the co-operatives and their members. MPCSs and larger co-operatives are to some extent represented in the Board of Directors or in the DCCs, but the voice of smaller co-operatives is easily lost in case the DCCs are not functioning well. 

Member needs

In same cases, we have been able to talk to the members of the co-operatives about their problems, concerns and needs, in other cases we depended on the information given by the co-operatives.

       Many members we have spoken to during our assessment were not aware of the functions and the purpose of co-operatives. They were unaware of their rights and obligations as members of co-operatives, and were unaware of how the principles of co-operatives, for instance working together with fellow members, could help them increase their business profit. Training on the functions and the purpose of co-operatives as well as co-operative values and principles is needed. Another need of members is to receive training and education on how they can become economically active, or how they can develop their existing business ventures. This includes vocational training in agricultural techniques, packaging, marketing, setting up small businesses and developing these businesses. In many districts the Department of Agriculture and the Department of Industries provide training courses, but the training venues are not always easily accessible for members or the members are unaware of these training facilities. Sometimes members cannot access the Department’s training venues because of a lack of transport possibilities or because the training courses are provided during business hours when members have other obligations. Co-operatives could in the future play a facilitating role in this problem. One of the visited co-operatives, an agricultural co-operative, is already undertaking this. They invite trainers of the Department of Agriculture to come to the co-operative, which is easily accessible for the members, and to train their members there.

       Another problem of members is that they often do not have access to markets, either they do not have the time or money to travel to a market, or the quantity of their production is simply too small to make the trip to the market worthwhile. As a result members are forces to sell their products to middle men, who pay lower prices for the products than the members would have received at markets. Studies have shown that poor access to cities and markets is interrelated to higher levels of poverty.[2] Co-operatives in general attempt to give their members a better price for their crops than the middle men. But many co-operatives require their members to bring their crops to the co-operatives themselves. Few co-operatives are addressing the transportation problems that some members are facing.

       Lastly, not all members have access to capital to invest in small business ventures, or to invest in their current businesses. As stated above, not all members are eligible for loans. Especially members who do not have any capital themselves are usually not able to meet the requirements of the co-operative banks. These requirements make sure that the member who is applying for a loan is able to pay the loan back. But the requirements also exclude the underprivileged part of co-operative’s membership from getting access to loans. At the moment, the co-operatives we visited only supplied loans to individuals. By supplying loans to groups, the co-operatives would be able to assist the most underprivileged part of the co-operative’s membership. Furthermore, by supplying loans to groups, the co-operatives encourage their members to work together on common business ventures.

During our fieldtrip we have identified various needs of members of co-operatives. There are a lot of opportunities for co-operatives to play an active role in meeting these needs and assisting their members to improve their social and economic wellbeing. However, this does require sufficient management skills, human resources and financial means at the co-operative level in order to be able to set up and successfully carry out these projects.

Assessment on functioning of NCC

In this section, our observations, findings and views on the functioning of the NCC will be discussed. In order to assess the functioning of the NCC we will first discuss the degree to which the NCC is able to meet its objectives. In this section, the opinions of the visited co-operatives as well as the opinions of questioned stakeholders will be included. In the second section we discuss the NCC’s ability to sustain its own organization, after which the internal functioning of the NCC will be discussed. This report will conclude with a list of recommendations.

Ability to meet objectives

The objectives of the NCC are:

1. To promote and develop the Co-operative Movement in Sri Lanka
2. To educate, guide and assist the members in their efforts to expand and strengthen the

Co-operative Movement.

3. To serve as an exponent of Co-operative opinion in accordance with basic Co-operative principles.
4. To express views on behalf of the Co-operative Movement and represent it both nationally and internationally.

The basic objectives of the NCC and its core functions are thus to educate and to assist the co-operative movement and to represent the co-operative movement nationally and internationally.

Training and Education

The NCC currently provides 2 long term education programs: The Co-operative Employee’s General Certificate, which takes 6 months, and the Co-operative Employee’s Advanced Certificate, which takes 9 months. Annually approximately 200 people participate in the General Certificate program and approximately 30 people participate in the Advanced Certificate program. There are two examinations at each education program. The NCC also provides short term training courses for the members of the Board of Directors, but also for teachers and executive officers of the co-operatives. These courses include: leadership development, management skills, co-operative law, Human Resource Development, research methods, rural banking, good governance and marketing. These courses are conducted every year.

       The NCC’s training and education programs have not been updated in 25 years, the training material itself to some extent is outdated. Some co-operatives mentioned this as the reason why they do not attend NCC training and education programs. The NCC’s Education and Training Department indicated that it hasn’t been able to update the training programs due to a lack of funds.

       The majority of the training courses are conducted at NCC’s training centers in Kurunegala, Galle, Kahagolla and Anuradhapura. Some co-operative, especially those in the Batticaloa district, indicate that they are not always able to travel to these training centers due to the current safety situation. Some co-operatives have also indicated that they think the training courses are not provided frequently enough. Another concern raised by these co-operatives is the fact that there are no training courses provided in Tamil. Since Tamil is an official language in Sri Lanka, native Tamil speakers see it as their right to receive training in Tamil. For native Tamil speaking people, training courses in Tamil would also be more effective, as it is their first language.

       The co-operatives also indicate that the training courses provided by the NCC do not meet all their training and education needs. These co-operatives indicate that they would like to receive training in computer skills, management and leadership, accounting, business planning and strategy. The NCC already provides training in some of these areas. Either the co-operatives are not aware of the existence of these training courses, or the co-operatives are not satisfied with the quality of these courses. The NICD also provides the training and education programs which the co-operatives indicate they want to receive. However, the co-operatives indicate that they would prefer the NCC to provide these trainings.

       The smaller co-operatives expressed their dissatisfaction about the selection of scholarships for attending NCC training. According to them scholarships are only given to larger MPCSs and not to smaller co-operatives.

         Some co-operatives, as well as a representative of the NICD have suggested that the NCC and the NICD and/or SANASA should work together on their education and training services. Collaboration between these organizations could be an opportunity for the NCC to improve and extend its training facilities. As one co-operative representative rightly indicates, the NCC is the only institution that educates about co-operative values and principles. This is a strength of the NCC’s training and education department.

Assistance and Guidance

Occasionally, the co-operatives directly contact the NCC with requests for assistance. Usually, the co-operatives come to the NCC when they have a problem regarding management, but also when they have legal questions or questions regarding banking, investments or other issues. The NCC addresses these requests, but we have not received any information about whether these requests are dealt with effectively and within an appropriate time frame. In its current position the NCC is not able to assist co-operatives financially. The co-operatives we have visited were not aware that they could turn to the NCC with requests for assistance.

       Furthermore, there is no regular communication from the NCC to the DCCs or the individual co-operatives in the form of a newsletter or regular information bulletins on best practices and developments in the co-operatives movements. Currently, in case there is something that needs to be communicated, the NCC calls the members together. Also, before General Body meetings, all members can suggest agenda items which will be discussed during the General Body meeting.

Representative of co-operative movement

Some of the people we spoke to during our research, as well as some previous studies[3] indicate that the NCC is not able to adequately represent the co-operative movement on a national level. Some respondents especially mentioned the NCC’s reluctance to lobby the government and push for much needed legislative change. On an international level, the NCC attends all meetings of the International Co-operative Alliance (ICA), but the effects of attending these meetings are not very clear. The NCC has not acquired structural funding from foreign parties through the ICA network, nor has it received assistance from the ICA itself. However, the travel expenses to go to these meetings as well as the ICA membership fee are considerable.

       More fundamentally one could question whether the NCC is aware of what is going on in the co-operative movement at the grassroots level. NCC wants to be the representative of the co-operative movement on a national and international level. However, there is no direct connection between the NCC and the individual co-operatives. Due to this, the NCC depends on the functioning of DCCs to give them an idea of what opinions, problems and challenges the individual co-operatives are facing. Also, not all co-operatives are members of the NCC or DCCs. Especially the more recently established single purpose co-operatives do not all participate in the co-operative movement. Furthermore, because some members are not seeing the benefits of their membership to the NCC, they loose interest and turn away from the NCC.

Self sustainability

When looking at the NCC’s budget, it becomes clear that the NCC would not be able to operate without outside funding. Also, because of this lack of funds, the NCC is not able to meet all its objectives. This cash flow problem of the NCC has been indicated before, for example in the study done by Patricia Parker in January 2007[4]. In her report, Ms. Parker also stated that the NCC with its staff and property has great potential of generating capital and becoming self sustainable. Her study identifies the following business opportunities:

-          Developing the Banking Unit

-          Developing the Architectural Services Unit

-          Developing the Holiday resort in Anuradhapura

-          Developing the hostel and rental facilities of the four regional education centers (two of the four regional centers are currently running at a loss)

-          Evaluating whether the property of the NCC in Colombo is used in the most effective and profitable way.

These business opportunities of becoming (more) self sustainable have been indicated over a year ago, but still no plan of action has been developed. One of the recommendations of Ms. Parker’s report was that a schedule of assets should be developed to get insight in the current state of NCC’s property as well as how it is currently used. This schedule should include details about NCC’s properties, the current tenants, the rent these tenants pay, and what the lease terms of these tenants are. But since January 2007, no schedule of assets has been developed.

Funds

When it comes to the question how the existing cash flow problems can be addressed, there is a very strong focus on obtaining foreign funds. In a way this reflects the causal belief of the management of the NCC that once foreign funding comes in, the NCC would automatically be able to function more effectively. However, it’s highly questionable whether that would be the case. Experiences from the past, rather suggests the contrary. In 2005, NISPED, the Israeli Co-operative Movement funded a project to rebuild 10 MPCSs in Tsunami affected area. However, half way through the project, NISPED stopped the funding because they were unsatisfied with how the rebuilding project was carried out. Since then, NISPED turned away from the NCC and has not funded any of NCC’s activities ever since. Negative experiences of a foreign donor do not only make this donor turn away from the NCC, it also negatively affects the image other foreign donors have of the NCC. Furthermore, the NCC should seriously consider if it is desirable to depend on foreign funding. Foreign funding, if it comes in at all, comes in highly irregularly, it is not something the NCC can depend on. Also, money hardly ever comes without requirements or at least expectations, which endangers the NCC’s autonomy and may not always be in line with the NCC’s priorities and objectives.

       Despite the strong focus on obtaining foreign funds, there is very little attention on how the current funds are allocated within the NCC. To make a suggestion: in the proposed budget for 2008, R3.285.700 is reserved for foreign travel expenses. This covers the expenses made by the chairman, members of the Board of Directors and other NCC members to attend foreign meetings of the International Co-operative Alliance (ICA). These meetings occur three to four times per year. Representing the co-operative movement at an international level is one of the objectives of the NCC. But with the current problems and challenges, one can question whether this should be a priority. The NCC is spending R 3.285 million on foreign representation, whereas no money is reserved for national representation and lobbying the government for much needed legislative change. Also, the outcome of these foreign trips in terms of generating foreign funds for the NCC has been questionable or at least not structural in nature. In terms of gaining knowledge and skills at these international meetings, there is no forum to enable the members who attend these meetings to share their experiences with other cooperative leaders. If the NCC would decide not to attend all ICA meetings, money could be saved which could be used to invest in NCC’s business ventures which would enable the NCC to become self sustainable.

Internal functioning of NCC

When looking at the internal functioning of the NCC, the first thing one notices is that certain positions within the NCC are vacant. The following positions within the NCC’s organizational chart are currently vacant: Director of Administration/Establishment, Director of Business, Director of Projects, Assistant Director of Foreign Affairs and Assistant Director of Examinations. At the moment, the General Manager attends to the departments that have no director. Due to this, the General Manager has little time for strategic planning and business management. Also, due to the absence of middle management, there is no direction and guidance of employees, which hampers the efficiency and motivation of the employees. Not all employees have a job description, they are not given targets and goals and there is no evaluation on their functioning. Furthermore, there is no human resource strategy or development plan; the skills of employees are not fully developed and the NCC is not fully making use of the available human resources. Furthermore, certain departments are overstaffed whereas other departments have a shortage of (skilled) employees. Within the department of Education for instance, there is no Assistant Director, no Chief Education Officer and there are no lecturers permanently employed by the NCC. Employees further indicate that some people have been hired for a certain position, but since this position is not embedded within the NCC structure, they are not able to perform their tasks satisfactorily. The forthcoming SCC project “Strengthening the Capacities of Co-operative Societies in Sri Lanka” will address these issues by increasing the capacities of the staff of the NCC. 

       Previous reports and studies, among which, the report written by Ms. Parker, have recommended the NCC to develop a development and strategic plan. However, until now, no strategic or development plan has been implemented. In 2007, a strategic plan has been prepared, but it has not been discussed or implemented. Without a development or strategic plan, the NCC operates without direction. In her report, Ms. Parker indicates the NCC’s lack of the ability to look in the future and plan ahead. Instead, decisions are made to establish short-term benefits. This is reflected in the recent decision of selling the printing press machinery. The printing press used to be profitable and had the potential to become profitable again. But instead of investing in this business opportunity to generate income on the long term, the NCC chose to sell the machinery and receive short term benefits. Without a strategic plan, the NCC operates without direction, in case foreign funding comes in there is no plan of how to use it. Due to this, the chances of the money being well spent are minimal.  

       As trainees at the NCC we have also worked on the development of projects for co-operatives and their members. When it came to which projects were to be developed, we noticed that the NCC was developing projects based on the funds that were available, rather than based on what the members of co-operatives need. Although obtaining foreign funding is essential, it shouldn’t be the only incentive for starting a project. When projects are not addressing member- or co-operatives needs, one can question the effectiveness of these projects. If the NCC would assess co-operatives’ needs as well as the co-operatives’ members’ needs, the NCC would be able to match available funding to these needs, which would increase the efficiency as well as the effectiveness of projects developed by the NCC.

Conclusion and recommendations

Despite the fact that many co-operatives are operating well, the majority has not been able to adjust to the open market circumstances. Furthermore, not all co-operatives function in accordance with co-operative values and principles, but are rather ran like a business. The NCC also faces serious challenges. It is not self sustainable and has a serious cash flow problem, due to which it has not been able to meet its objectives.

The biggest problem of the NCC, as we perceive it, is the fact that there is no strategic development plan within the NCC. The NCC has clear objectives which it seeks to achieve, also the main problems within the NCC have been identified in previous studies and reports. But what is lacking is an articulated plan of how to address these problems and achieve the objectives. Likewise, in order to become self sustainable and to escape the chronic dependency on foreign donors, the NCC has to develop a business plan in order to become self sustainable.

In order to develop and implement the strategic development plan, the NCC has to improve its internal function through developing its human resource. Also, a middle management level is required to motivate and guide the employees. The forthcoming SCC project “Strengthening the Capacities of Co-operative Societies in Sri Lanka” aims to address this issue and we shall therefore not address it here. 

Business Plan

One reason why the business opportunities of the NCC have not been developed is because the NCC management claims it does not have the funds to hire a business expert and develop a business plan. As we have indicated, the NCC currently spends a considerable amount on representing the NCC on an international level. As we have argued, these meetings, though very important, at the present time do not deserve priority over becoming self sustainable. This is not to say that the NCC should discontinue its ICA membership. However, if the NCC would decide to not attend all ICA meetings, or maybe to not attend any meeting for a year, a considerable amount of money would be saved. With this money the NCC would be able to hire a business development expert, who in cooperation with the NCC develops a business plan to develop the NCC’s business opportunities. The objective of this plan is to make the NCC self sustainable and to enable the NCC to generate capital through business ventures.

Strategic Development Plan

The NCC has well defined objectives but due to the financial problems as well as management and human resource problems, the NCC has not been able to achieve these objectives. Within the NCC there is a lack of vision on the role the NCC wants to play within the co-operative movement and how the objectives can be met. This report, as well as previous studies and reports conducted by the ICA, SCC and Ms. Parker, have assessed the current situation of the NCC and the co-operative movement at large; problems, challenges and issues have been identified. The NCC should develop a detailed plan of action of how it will address the problems and challenges and how it will achieve its objectives. This strategic development plan should also include a long term perspective of the role the NCC would like to play within the co-operative movement.

In order to assist and represent the co-operative movement, the NCC has to reach out to its membership and try to understand its issues, problems, challenges and opportunities at the grassroots level. Without member participation the NCC is a defunct organization. By involving both members and staff in the development process of the strategic development plan, the NCC is showing it is aware of the current problems and willing to address them. It also shows that the NCC is willing to listen to grievances but also to the members’ and staff’s ideas and suggestions of how to address the existing problems.

Achieving its objectives should be the main priority of the NCC and its strategic development plan is the roadmap of how to achieve that. The strategic development plan should include detailed goals and targets as well as a plan of action of how to achieve it. In our view, this plan should include the following issues;

·         Increase human resources and hire middle management. The organizational structure of the NCC, as it exists on paper should be implemented. This requires that the vacant positions need to be filled. Employees should receive guidance and training to increase their capacities in order to work more effectively and more efficiently. Management and leadership skills’ training is needed for the management and Board of Directors of the NCC. The forthcoming SCC project “Strengthening the Capacities of Co-operative Societies in Sri Lanka” aims to address this issue.   

·         Update education and training syllabus according to co-operatives’ needs and make these training and education courses accessible to all members. This includes providing training in Tamil and making scholarships available both to small and large co-operatives. In case co-operatives’ employees cannot come to the training centers due to security reasons, the NCC has to provide training in their districts. The NCC should advertise these courses in order to make the co-operatives aware of the availability of new and improved training and education courses. These training courses should enable the co-operatives to become profitable, but also to make them aware of their members’ needs and how they can assist their members in meeting these needs.

·         Lobby the government for legislative change. First of all, the NCC has to assess which regulations in the Co-operative Societies Law and the Co-operative Employees’ Commission Laws and Regulations constraint the functioning of the co-operatives the most. Second, the NCC has to reestablish its relation with the government and open a dialogue. Through this dialogue, the NCC on half of the co-operative movement can express the grievances and problems these specific regulations in the Co-operative Societies Law cause. The NCC has to set up lobby activities to convince politicians and policy makers that legislative change is needed.

·         Create a knowledge share platform for members. There is not much cooperation and communication among co-operatives. However, there is much that co-operatives can learn from each other. What currently is lacking is a platform for the co-operatives to share their experiences and know-how. The NCC should facilitate regular meetings of co-operatives on a district and national level to exchange knowledge, best practices and experiences.

·         Establish better communication with and among membership and co-operatives through newsletters or magazines. In order to increase the cooperation and knowledge exchange between co-operatives, the NCC should facilitate regular newsletters or magazines in which this information can be shared. The individual co-operatives should all be invited to contribute to these newsletters and magazines. This medium would reinforce co-operative values and principles and would be a means to reach out to less active co-operatives. Newsletters or magazines would also enable the NCC to directly communicate with their members and the co-operatives and to discuss what it is doing for the co-operative movement. This would help to reestablish confidence among the members and co-operatives towards to NCC and the co-operative movement at large. 

·         Guidance and assistance for members and co-operatives. Both NCC members as well as co-operatives should know that they can turn to the NCC for help and assistance. These requests for guidance and assistance should be directed to the appropriate heads within the NCC and dealt with within an appropriate time span. This service would help to increasing confidence of the members in the NCC and encourage participation.

·         Develop projects according to co-operatives’ and their members’ needs. A project can only be successful if it addresses an actual need within the co-operatives or among the co-operatives’ members. The future project manager should therefore first assess the co-operatives’ and their members’ needs and match these needs with existing funding programs. 

As we see it, the co-operative movement in Sri Lanka has the potential to become profitable and a medium through which development can be achieved. However, many co-operatives are struggling and if they do not receive the right guidance and assistance they will not be able to survive. As the national apex level organization the NCC has the potential to become the driving force behind positive change by assisting the co-operatives to become profitable and to function according to co-operative values and principles.

However, the NCC can only fulfill this function if it’s willing to critically assess its current functioning and take the necessary actions to improve it. Only if the NCC becomes self sustainable and independent, and develops a detailed strategic development plan, it can facilitate the development of the co-operative movement in a sustainable manner.