Contrary to the notion that community organizations, like cooperatives, would not work in a highly unstable, chaotic, and turbulent environment, this piece of work proved that they may still work and endure development activities given certain caveats in the pursuit of their tasks. This premise is founded on the research conducted by the author entitled “Farmers’ Cooperatives in Conflict – Ridden Areas: The Maguindanao Experience” which highlighted the experiences of four farmers’ cooperatives operating in the conflict affected areas of Maguindanao, an impoverished province of the Southern Philippines.
The volatile peace and order condition in the area coupled with management problems among other things dragged these cooperatives to flounder, and later, leading most of them to shut down their respective operations. However, despite of this scenario, there are still those that yielded viable projects, and had delivered significant benefits to their respective members. Being puzzled about these things, the author conducted a research study comparing the plights of these cooperatives, and subsequently provided explanations why, there are still those that can operate viable projects, and provide better services to their respective members, in contrast to those whose operations failed, and later just “die a natural death.”
SELECTION OF COOPERATIVES FOR CASE ANALYSIS
It took some doing to “sift the chap from the grain” as it were, that is, to pick which of the cooperatives registered at the Cooperative Development Authority (CDA) Maguindanao should be considered viable and which not. After consulting Mr. Tutin Saptu, a CDA Specialist, a list was made up classifying the cooperatives into viable and non-viable ones. The main criteria used to designate viability or non-viability was whether or not the cooperative was continuing to render services and implement activities for its member-farmers, that is, whether or not it was still active as a cooperative.
In particular, non-viable cooperatives were those that had been previously active but had since ceased to operate. Out of the 1,010 multipurpose-agriculture cooperatives registered at the CDA Maguindanao from l990 to l998, only about eight (less than 1 percent of the total) were found to be still active. The others had apparently suspended or stopped operations altogether. A number had registered but never managed to begin operations.
In order to assess at firsthand the state of those cooperatives identified in the list, visits to those organizations were made and their officials interviewed. It was then decided to choose two of them, based on their income, the nature of services they offered, and the size of their membership, to represent the viable coops. One was picked from the first district of Maguindanao and the other from the second district. Two others were chosen that had once been active but had now become inactive because of one problem or another, one from each district as well. There were then a total of four cooperatives to be included in the research, namely, Woodland Integrated Farm Resort Multipurpose Cooperative (WIFRMPC) in Sultan Kudarat and Brar Communal Irrigators Multipurpose Cooperative (BCIMPC) in Talayan, both active coops, and Kurintem Farmers’ Multipurpose Cooperative (KFMPC) in Datu Odin Sinsuat, and Kooperatiba sa Bayan ng Ampatuan (KBAI), the problematic coops. In addition to the above criteria, these four were chosen, in particular, because they consented to the study and were willing to cooperate. Also, they were all fairly accessible and their membership consisted mainly of farmers.
Comparing Viable Cooperatives from the Non-Viable Ones: Distinguishing Characteristics
The viable cooperatives sustained their operations because of the following characteristics:
1. Strong family-based leadership as a key factor for viable coop operation.
WIFRMPC and BCIMPC continue to operate partly because strong family leadership served to bond the members together. In the case of WIFRMPC, the leadership provided by the Pahm clan of educators and professionals gave the cooperative a solid vision as an impetus for its growth and development. In the case of the BCIMPC, the Sultan family, a respected traditional leading clan in the community, provided such leadership. In both cooperatives, strong leadership encouraged unity and teamwork among the members and officers. It was this kind of leadership that enabled the cooperatives to endure amidst the turmoil in Maguindanao.
2. Dynamism and versatility in income generating activities lead to both coop productivity and sustainability.
Flexibility in the pursuit of economic activities, coupled by the resolve of both members and officers, appear to be critical for cooperative development. Both WIFRMPC and BCIMPC sought to diversify their economic projects and sources of income. The WIFRMPC, in addition to its fisheries, poultry, forestry, coffee, rice, and corn production activities, also engaged in rice, corn, and oil trading. It also derived income from operating the resort’s facilities. BCIMPC, on the other hand, engaged in trading to supplement its income from rice and corn production. To conserve their resources, both cooperatives also stopped their lending services after the crop failures that plagued their members. WIFRMPC focused its resources on collecting on its receivables. BCIMPC, on the other hand, sought to become independent of the Land Bank’s support for its programs.
3. Efficient utilization of resources (technical, financial and human) enhances coop productivity and sustainability.
WIFRMPC and BCIMPC both benefited from the training exposures of their members. Officers of WIFRMPC supervised their members’ farming activities to make sure that they apply the technical know-how taught to them in training. In the BCIMPC, the Chairman took the lead role, serving as a model in applying new technologies. As a result, both cooperatives began to show positive earnings after an initial period of losses. They also both managed to continue to deliver services to their members despite problems with unpaid loans.
4. Networks and linkages contribute to both coop productivity and sustainability.
Both cooperatives nurtured and sustained the networks and linkages they established with institutions working for cooperative development. Their members were able to benefit from these networks and linkages, acquiring new technologies and techniques for increasing production.
5. Membership Expansion increases paid up capital, which subsequently enhances coop productivity and sustainability.
Both cooperatives expanded membership, with WIFRMPC enjoying an average annual rise of 93 percent and BCIMPC, a 70 percent increase. More members naturally meant corresponding additions to paid-up capital that helped each cooperative enhance productivity and sustainability.
On the other hand, the failed cooperatives were dragged down by the following circumstances:
1. Leadership crisis leads to vulnerability and insensitivity to problems, dragging down the coops to failure.
When coop officers fail to be responsible, the whole organization suffers. KMPCI officers’ limited knowledge of the concept of cooperativism made them entirely dependent on the chairman to run the cooperative. When he left, the officers were at a loss. KBAI officers, on the other hand, allowed the cooperative’s founder (the ex-priest) to manipulate the organization for his personal ends, leading the cooperative to ruin. The democratic processes that underpin the operations of cooperatives were never allowed to function properly.
2. Failure in project implementation results in no return of investment, non-payment of loans by the borrowers, and non-productive coop operations.
Both cooperatives failed in the implementation of their respective projects. Management incompetence confounded the crop failures that plagued the cooperatives’ members: KMPCI management’s laxity allowed its cashiers to steal from the coop store; KBAI fell to the wiles of its founder who took funds from the cooperative for his personal use and whose action led to the coop’s members refusing to repay their debts.
3. Dole out mentality leads to unproductive (passive) coop.
Cooperative members, having been exposed to government dole-outs in the past, sought to get out of repaying their loans by regarding them as nothing more than government largesse. This irresponsible position also led them to effectively abandon their obligations as members of their respective cooperatives.
4. Non-utilization of technical know-how acquired from training leads to non-productive performance.
The failed coops were unable to profit from the technical skills they were taught in training. For lack of resources, they were unable to provide the material support that their members required to upgrade their production techniques.
5. Unsustained networks and linkages meant lack of support mechanisms that could further enhance coop productivity and sustainability.
Neither cooperative was able to nurture and sustain the networks and linkages each had established with development agencies working for cooperative development.
6. Deficient record-keeping meant absence of reliable information on the coops’ financial condition, making them vulnerable to further corruption.
Persons in responsible positions in both cooperatives failed to keep reliable records of their respective business transactions. In the case of the KMPCI, the records maintained by the records officer did not jibe with the records of disbursement by the cashier. The case with KBAI was similar as releases were made without following proper procedures.
The research came up with the conclusion that for cooperatives to viably operate in conflict-ridden areas, the following organizational factors appear to be critical: a) leadership, i.e. strong family- based leadership; b) dynamism and versatility in income generating activities, illustrating both a certain degree of flexibility but also highlighting the resolve of coop members to succeed; and efficient utilization of resources (technical, financial, and human).
On the other hand, those traditional factors that are thought to generally apply to all cooperatives, such as purposes and objectives, and organization and management may not be critical at all. As the study showed, these factors did not have any bearing on either viability or non-viability conditions.
Institutional networks of cooperatives and assistance extended by national government agencies and international organizations proved to be contributory factors to coop viability as long as the acquired technologies were applied productively. However, links with non-governmental organizations, local government units and coop federations and unions, were not critical for the survival of Maguindanao coops in contrast to the more positive experience of cooperatives in Bulacan and Davao Del Sur (Gaffud, 1995).
In the experience of cooperatives in Maguindanao, the contributions of private institutions proved to be critical in enhancing coop viability, contrary to the traditional belief that they play no role. Private institutions assisted cooperatives in acquiring technical know-how and in marketing their produce.
Finally, while the action environment (political, economic and social) appeared to negatively impact on cooperative operations, their effect was not so great as to threaten coop survival or freely operations. The cooperatives were able to apply compensating strategies to reverse whatever stifling forces that may be attributed to such environmental factors.
Radzak A. Sam DPA is a former faculty member of Mindanao State University-Maguindanao, and Cotabato City State Polytechnic College, Cotabato City, The Philippines. He is currently teaching at the School of Social Sciences, Universiti Sains Malaysia, Penang, Malaysia.
Gaffud, Rumualdo B.
1995 Strengthening Market Leverage of Peoples Enterprise and Promoting Self-Reliance: A Framework for Collaboration between Cooperatives and Local governments (Focus on the experiences of cooperative and Provincial Governments in Davao Province and Bulacan). Doctoral Dissertation. UP-CPA
Sam, Radzak A.
2002 “Farmers’ Cooperatives in conflict –Ridden Areas: The Maguindanao Experience”, a dissertation research submitted to the National College of Public Administration and Governance (NCPAG), University of the Philippines, Diliman, Quezon City, Philippines.
CDA Annual Report, 1998
Tutin Sapto, Cooperative Specialist in Maguindanao, 14 September 2000