29.3. entrepreneurship and farms

29.3. Entrepreneurship and farms

The construction of entrepreneurial agency on farms/ Vesala 2010

Analytical framework I: basic elements of entrepreneurial agency

Making it happen … .. for whom (or what)

Self as principal

Self as pursuing opportunities

Material and social environment of the pursuit

Other principal frames (principles?!)

Analytical framework II: the role of entrepreneurship discourses in the study of the construction of entrepreneurial agency

Individual constructing agency: acting in social context; making sense and giving accounts (communicating); relating to discourses (digesting, rejecting, utilising them)

Environment/Other actors/ structures, e.g. government, culture, research institutions etc.: enabling/ constraining individual; relating to e. discourses (creating, changing, utilising them)

Generic entrepreneurship discourses

?

Entrepreneurship discourses: recollection

• In discourses entrepreneurship (entrepreneur, entrepreneurial behaviour) is constructed (= portrayed, defined) (in varying ways, and with varying consequences):

• Perren & Jennings: governmental discourse; entrepreneurs as actors who serve economic system by aiming to grow their businesses (-> the autonomy of entrepreneurs threatened)

• Ogbor: research and cultural discourse; entrepreneurs as male heroes capable of innovative economic achievements (-> social equity threatened)

• Chell: research and governmental discourses: entrepreneurship as pursuit of opportunities, either with the aim of creating economic value or creating social value

Entrepreneurship discourses and the farm context?

• Phillipson et al. (2004) Treating farms as firms? The evolution of farm business support from productionist to entrepreneurial models. (Environment and Planning C: Government and Policy 2004, volume 22, pages 31 – 54.)

• “Throughout the European Union (EU) farming enterprises have traditionally operated within a very different political and economic environment from their nonagricultural counterparts. Agricultural activities have been governed by a separate set of policy objectives, political institutions, and support agencies. However, this agricultural `exceptionalism' is being challenged via the liberalisation of markets, reform of government institutions, and demands for the closer and more strategic integration of farming within wider local and regional development initiatives.” (p. 31)

Phillipson et al. (2004, 32-33)• “Ongoing trade liberalisation as well as reform of the Common

Agricultural Policy (CAP) are leading to increased pressure for the reorientation of farming to a more entrepreneurial model, that is both competitive and sustainable. Such changes in the policy context and trading environment are promoting alterations in the role, attitudes, and business practices of farmers and attempting to reduce the distorting effects of agricultural subsidies upon their business aspirations and decisions. As commodity price support systems are reduced and as production subsidies decline or are redirected, farmers will increasingly need to adapt.

Many will find it difficult to compete purely on a cost basis and will need instead to focus their attentions on the identification and exploitation of opportunities for niche production and markets, means of adding value to their products, or enhanced systems of cooperation. Farmers are also being encouraged to diversify into alternative and nonfarming enterprises (PIU, 1999). Shifting from a production to a more entrepreneurial model will require a greater emphasis on the personal capacities and entrepreneurial skills (1) of farmers with respect to commercialisation, promotion, and organisation (van Huylenbroeck and Durand, 2003).”

Phillipson et al. (2004, 33)

1) According to the UK paper Enterprise for All (SBS, 2001) an entrepreneurial approach is characterised by original thought, innovation, and risk taking. Such an approach has traditionally been less important to the farming sector as a consequence of protected markets and direct payments. With market liberalisation farmers are being encouraged to take on or seek out new economic opportunities which is placing greater emphasis on risk taking and market orientation and upon the development and application of (new) generic business skills.

Phillipson et al. (2004, 33)

• In the United Kingdom, albeit with notable exceptions, many farmers have been characterised as lacking general business capabilities and as unwilling to adapt or develop new skills in light of changing demands, which is seen as part of a wider skills challenge within the agriculture and food sectors (DEFRA, 2002; Scottish Executive, 2002) (2).For example, according to the Performance and Innovation Unit:´The problem of less entrepreneurial behaviour among some farmers may be a legacy of the heavily interventionist frameworks that have dominated agriculture throughout the post-war period. Government has not encouraged farmers to see themselves as entrepreneurs.` ”

Concluding the outline of Phillipson et al.

• Entrepreneurship discourse in agricultural policy: entrepreneurs as agents who survive in open markets by pursuing business opportunities; farmers as actors lacking such agency; -> farmers should be developed into entrepreneurs (by the government)

• Comp. Bryant (1989) Entrepreneurs in the rural environment. JRS 54:4

Are entrepreneurship discourses totally new and alien to farmers and

farming culture?• In addition to policy discourse, positive

answer have been presented in some research discussions

• Dudley (2003) The entrepreneurial self? Identity and morality in a Midwestern Farming Community. In Adams, J. (ed.) Fighting for the farm. University of Pensylvania press.

Task for 29th of March• Write down for yourself detailed answers to the following

questions, so that you will be prepared to take part in the discussion:

• What does Dudley (2003) mean by entrepreneurial self? What are the aspects and features of it? Is it the same as entrepreneurial spirit?

• What is the relation between farmers in Star Prairie and entrepreneurial self

• What is the relation between entrepreneurial self and the modern capitalistic market economy? How does entrepreneurial self connect to the restructuring of agriculture?

Dudley: conclusion• Rather than two distinct categories of farmers

(entrepreneur vs. yeoman) (p. 177-178), entrepreneurship suits for describing the commonly shared cultural basis of farming community.

• E agent: aims to be independent, produce efficiently, grow the farm (legitimated by over-generation continuity and ”a good-farmer eye”), assumes personal responsibility for the economic risk (self as principal?)

• Entrepreneurial self as a ground/foundation for self-regulative agency in farm ownership and management, but also for excessive risk-taking

• Credit-based production/absentee ownership as threats (186)

Dudley: conclusion

• ”The rhetoric of risk reframes the danger of dispossession and capital penetration as an individual moral dilemma” (186) (self as principal –frame legitimating capital penetration?)

• The rhetoric of risks limits the ability to conceptualise the social consequences of macro-economic forces that are beyond individual control (187) (exaggerating farmers agency)

• the rhetoric of risk helds individual accountable for their losses, while state sponsors the penetration of capital (188)

Pyysiäinen, Halpin & Vesala (2010, in press): Entrepreneurial Skills among Farmers: Approaching a Policy Issue.

• Developing the entrepreneurial skills of farmers (ESoF-project)

• The discourse of entrepreneurial skills in the construction of entrepreneurial self (and agency) by farmers?

• Self-presentations regarding entrepreneurial skills (recognising and realising business opportunities; networking and utilising contacts; creating and evaluating business strategy)

Figure 1 Aspects of the self (derived from Baumeister 1999)

E-skills

Executive

Reflexive Relational

Presentationof self

Aspects of self

The reflexive aspect deals with self-awareness: the process in which individual views, identifies, defines, or understands herself (‘I’ looking at ‘me’: see G.H. Mead [1934]). This is most typically done in terms of group memberships and social roles.The relational aspect refers to self as an interpersonal being whose existence and action are fundamentally rooted and embedded in social relations. The third, executive aspect deals with the issue of agency. An individual evaluates things, makes decisions, and acts in order to regulate and develop her self as well as to control and influence her situation and events that are of importance to her. Agency implies self-reflection (Emirbayer and Mische 1998), but it is also closely tied with the relational aspect. Exercising control in social relations includes influencing others and the ability to utilize others as resources or vehicles for one’s own agency.

In the case of entrepreneurship, a strong emphasis is often put on the agency aspect of self: an entrepreneur is culturally defined as somebody who is active, persistent, and innovative (makes things happen in economic and social transactions). Thus, the executive aspect deserves special attention in the study of the entrepreneurial self. Entrepreneurial skill is one of the concepts which

allow us to do this.

Case A: Entrepreneurship Inadequate: Lacking Agency

• The interviewee is a 69 -year old pig farmer, who operates the business together with his wife. The farm has about 70 sow pigs and 40 hectares of field. The farmer started his farming career in 1966, and expanded production in mid-

1990s. • Skill of creating and evaluating a strategy: The farmer claims

that the skill could be useful in principle, but in his case the operational environment and overpowering actors (vertical production chain, financers) have frustrated the plans he has tried to pursue. The progress of farming is presented as a victim of unpredictable changes and uncertainties associated especially with the dramatic decreases in producer prices after Finnish EU membership; since then, the farmer claims, things have not been manageable with planning or foresight.


• Skill of networking and utilizing contacts: The farmer starts: “Well, it has been tried out for sure”, but goes on to explain that things like contacting the farmers’ union will not change a thing and that a farmer has no means to control his situation since the big players in the market – such as central franchising groups – are too strong. He claims that in such a situation networking will not work nor bring any commercial or cost benefits. He presents himself as having tried these

things but also as having recognized their uselessness.•


• Skill of recognizing and realizing opportunities: The farmer does not present a direct self-assessment concerning how good he is in recognizing and realizing opportunities, but assesses anyway that their farm has recognized an opportunity in pork production, since pigs yield much pork. However, he is not able to tell any examples of opportunity recognition or realization after the dramatic decrease in pork prices. Consequently he states that it is difficult to utilize these skills in his situation, even though they would be useful.


• Summing up the case, the farmer does not present himself as skillful in terms of any of the skills. Instead, he consistently claims that each of the skills is useless or impossible to utilize in his situation. The self that is presented is more a victim of circumstances than an active agent. The self that he presents is defined in terms of a traditional production-oriented world and its characteristic activities; as such it remains in the shadow of vertical chains and their “big” players. Even though the farmer does not oppose entrepreneurship discourse, as such, he nevertheless rejects it as inadequate to his situation.

Case B: Fluency in Entrepreneurship: Demonstrating Agency

• The interviewed couple runs a farm that focuses on the production of strawberries, other berries and their processing. Both wife (age 44) and husband (age 43) are involved in the interview. They started their farm in 1996. They currently employ around 20 seasonal employees for several months of the year, mostly to assist in picking berries.


• Skill of creating and evaluating a strategy: Even though they start by doubting if they really have strategic planning skills, they nevertheless present themselves as thinking about and discussing such things frequently. They present the development of their farm business and expansion of production as based on strategic thinking that includes product modification and development. They present themselves as orientated to customer needs and feedback, which can be utilized in the development of new products and attraction of new, or better, customers. The presentation gives the impression that their strategy is also a successful one, because they mention having more demand for products

than they can currently provide.


• Skill of networking and utilizing contacts: The initial direct self-assessment of the farmers is a hesitant one. However, the indirect assessments and accounts of their activities all point towards a self-presentation of being pretty good in utilizing networks and contacts. They have cooperation and joint acquisitions with other entrepreneurs and they have participated in courses and projects where they have learned to know the local entrepreneurs and network with them. In addition, they relay examples of using skills in the context of sales promotion and marketing, where their good contacts to matrons of industrial kitchens have helped them to increase sales and broaden the variety of products. They have also utilized local market research services to identify potential demand and markets for their products. Even though they present themselves as entrepreneurs who do not like to promote themselves in every social occasion and rather focus on doing things themselves, their presentation suggests that they utilize these skills in diverse situations and contexts.


• Skill of recognizing and realizing opportunities: The couple considers this skill as very important for their situation, and they also claim having had some success in recognizing and realizing opportunities that suit them. They substantiate their claim by explaining how they recognized and found a proper market niche for them: principally by not competing with the big players but having a variety of own processed products besides primary production. Another rhetorical resource in the demonstration of the skill is their customer and product structure, both of which are open to changes depending on the demand of the products – a feature they view as highlighting the importance of opportunity recognition and realization skills. They also present themselves as not being afraid of the uncertainty related to a turbulent environment but being comfortable and even excited about it. The farmers seem to have plenty of rhetorical resources to give a convincing impression of mastering and utilizing these skills.


• Summing up the case, the farmers are fluent in using entrepreneurship discourse. They construct themselves as having the skills, as the selves are presented in terms of skill manifestations in a diversity of contexts, such as production, marketing and customer relationships, and utilization of development projects and business services. The skills are evident in enabling the farmers to renew and change the emphasis of their farm business (e.g. products and customer relationships) according to the demands and opportunities encountered in the operational environment. The strategy selected is thus presented as an effective means to deal with,

and control the business in, a dynamic environment.

Case C: Negotiating Entrepreneurship: Relating to

Farming Community

• The interviewed farmers are cousins, both male, aged 30 and 40, who own a farm consortium, which produces crops (c. 180 ha). The older farmer started the farming in 1992 and younger one joined in 2005.

Case C: Negotiating Entrepreneurship: Relating to Farming

Community • Skill of creating and evaluating a strategy: The farmers do not

directly comment on whether they have a business strategy, but their subsequent descriptions function to present their actions as based on strategic planning. For instance, they aim to maintain their income level by taking pre-emptive actions to reduce costs. They demonstrate this principle by explaining how they have calculated the most profitable options in their machine investments, and on the basis of the calculations ended up buying a joint harvester-thresher together with a farmer from the neighborhood. They also mention having committed themselves to the cooperation with the neighbor. As an additional rhetorical resource, they give an account of the principle of strategic planning in their situation: one should be committed to the selected strategy on a longer range and also evaluate its pros and cons in the longer run.


Community • Skill of networking and utilizing contacts: The farmers do not

clearly present themselves as either having or lacking the skills. However, they give indirect accounts of themselves as having the skills, when they again describe their close production cooperation with the neighbor farm. They explain that the cooperative relationships – both within the consortium and with the neighbor – function as a kind of insurance for them; now that there are three farmers capable of taking care of the most important tasks, all three are better off in case of unexpected events and accidents. Furthermore, they explain that their networking skills are used to pursue clearly articulated financial purposes: they aim at cutting down production costs.


Community • Skill of recognizing and realizing opportunities: The farmers do not explicitly

present themselves as either having or lacking the skills, but they tell that the current mode of farming is the result of careful thinking and joint discussions, where they have reflected on the possible directions of their farm business. For instance, before making the decision about the joint machine investment they analyzed the situations of other farms in the region and the future availability of farmland; since possibilities to purchase extra farmland did not seem likely, they opted to intensify their cooperation with the neighbor farm as a means to secure effectiveness. In their explanation they state that they analyze what the realization of other business opportunities would require, but they view the opportunities from the perspectives of the farming community and safety. Above all, they do not want to “step on the toes” of other farmers and their businesses but want to maintain good relationships within the community where they have lived their whole lives. They claim that their primary production and forestry activities still provide them sufficient standard of livelihood and that’s why they do not view it necessary to try out any riskier options.

Case C: Negotiating Entrepreneurship: Relating to Farming Community

• Summing up the case, the farmers do use the entrepreneurship discourse, but its usage is characterized by efforts to reconcile it together with relational preconditions of the farming community. The self that is presented becomes defined in terms of activities and relationships related to primary production; on the one hand, the social relations are presented as enabling the management of the selected course, but on the other hand they are presented as restricting the range of trajectories that they consider desirable, such as willingness to engage in non-farm business activities. Nevertheless, the chosen orientation, which combines cost-reduction and anticipative action orientations, is presented as providing them their means of business control vis-á-vis the operation environment.

Concluding Esof

• cases B and C accepted the entrepreneurial skill discourse as relevant to themselves, even though they both reconciled it to their distinctive action situations in different ways. Case A, in turn, found the entrepreneurial skills to be inappropriate to presenting his situation: but even he did not reject the discourse as such, only its applicability for him. Indeed, the analysis revealed that in their self-assessments the farmers did not just passively accept or ingest the entrepreneurship discourse, but they actively used and reconciled it in the construction of their self-presentations. None of them simply rejected the entrepreneurship discourse nor claimed outright to be especially skilful; instead, they were active and creative in connecting the discourse to their own life-worlds and particular everyday experiences, which, as rhetorical resources, provided them different alternatives to substantiate the discourse.

Concluding Esof

• most of the farmers who were interviewed in the Esof project were favorable towards using the discourse of entrepreneurial skills. One might wonder whether this outcome had something to do with the procedure of selecting the interviewees, in which the potential interviewees were approached through middle men who knew that the study focused on entrepreneurship. A more reliable source upon which to base generalizations is provided by Vesala (2008), who reports results from a nationwide postal survey among farmers (n = 625) and non-farm rural small business owners (n = 126) in Finland. These results suggest that over two-thirds of farmers consider entrepreneurial skill as fairly or very important for themselves, whereas one in ten views these skills only somewhat or not at all important.

Concluding Esof

• It is apparent from our interview material that production related rhetorical resources did not enable the interviewees to make very rich and convincing presentations of their skills; instead, when convincing presentations of entrepreneurial skills were made, they were typically constructed with rhetorical resources associated with product development and differentiation, marketing and sales arena and customer and cooperation relationships. Comparing our three cases along such a dimension, we notice that cases A and B resemble almost polar opposites in this respect. It thus seems that how the skills can be digested and presented is at least to some extent determined by the immediate situation and characteristics of the action context, notably the nature of the business and business networks.

Concluding Esof

• As indicated in the case descriptions, a key difference in the self-constructions between these cases concerns the nature of agency. In the self-presentation of case B the entrepreneurial skills were connected to activities and instances that enabled the self to deal with, and control the business in spite of, uncertainties and changes in a dynamic environment. The self was constructed as an active agent, which, by means of the entrepreneurial skills, is able to effect change and exert control in the business environment. In case A, a contrary picture was painted as entrepreneurial skills were presented as inadequate: the uncertainties and changes of an overpowering business environment were presented as dispossessing the self of its agentic aspects. The entrepreneurial skill discourse did not provide the farmer any viable resources to demonstrate his agency.

Farms in Finland

• 1995: 95 562• 2008: 65 300 (-32%) (hecatares• 1995: average hectares: 22,8• 2008: 34,2 (+50%)

• 2007 Diversified farms: 23 200 (34%)• 2007: non-farm rural small business: 69 000

Vesala & Rantanen 1999: Pelkkä puhe ei riitä. University Press.

• Deliberate entrepreneur and the premise of growth (in the production arena)

• Helpless entrepreneur (in the market arena)

Coming back to Vesala & Peura 2003 (and the follow-up by Vesala & Vesala )

Coming back to Vesala and Peura 2005

• Previous: Diversification enchancing personal control, now variation also in it, at least in the market arena

Discourses in the background?

• In discourse there is a taken-for-granted assumption that market liberalisation and the dissolution of state protection (intervention through subsidies and regulation) creates the need for farmers to response entrepreurially

• ”Freedom to farm to market demand” • Not so simple, however• The nature of agricultural restructuring and

related policy discourses?

Potter & Tilzey 2005, 587 (Agricultural policy discourses in the European post-Fordist transition: neoliberalism,

neomercantilism and multifunctionality)

• While traditional family-farming constituencies, particularly those of neomercantilist and social protectionist persuasions, do continue actively and with varying degrees of success to defend state assistance in one form or another, the emergence of nonproductive fractions of agro-food capital such as processors, distributors and retailers as key and influential playersrm or another, the in the last 20 years has meant that agricultural market liberalization and the accelerated dismantling of state support now has strong support as a policy project (Cafruny, 1989; Hart, 1997; McMichael, 2000; Josling, 2002).

Potter & Tilzey 2005, 589• “However, while it may be true that the WTO negotiations created a

frame within which neoliberal interests could advance, a deeper understanding of the formative influences is required in order to explain why a neoliberal agenda for reform now began so strongly to emerge. Many of these derive from the restructuring of agriculture and the emergence of an agro-food industry composed of processors, distributors and retailers increasingly aligned to the interests of corporate capital.

While these 'nonproductive fractions of agro-capital may not exhibit all the characteristics of vertically integrated, transnational sectors such as electronics, clothing or automobile production (Goodman, 1997), they are now sufficiently disembedded from national and regional contexts and geared to the supply of world markets to be described as global in outlook and orientation (Josling, 2002).

This has eroded the coherence of the agricultural policy community, challenging corporatist models of policy governance and introducing new discourses into the agricultural policy debate which emphasize international competitiveness and improved overseas market access (McMichael, 2000).”

Potter & Tilzey 2005, 589

• Competing discourses:-multifunctionalism-neomercantilism

Multifunctionalism

• The concept ofmultifunctionality has its roots in a social welfare justification for state assistance which dates from the earliest years of the CAP (Potter, 2004). Since the mid-1980s, policy-makers have gradually acknowledged the need to diversify the income base of family farms by capitalizing on agriculture's ancillary functions such as biodiversity, landscape and cultural heritage.

Multifunctionalism

• Thus, advocates ofstrong multifunctionality position their case firmly within what Reiger (1977) has called 'the moral economy of the European Community' (sic) by regarding the activity of farming as one of the defining conditions of rural space, the purpose of state assistance being to create the conditions under which family farming, rural landscapes and society can flourish.

Neomercantilism

• Advocates of neomercantilism in agricultural policy, by contrast, start from an essentially productivist conception of the farmer's vocation, regarding the function of the state being to safeguard and underwrite productive capacity and export potential.