BDS market development guide.pdf - PACA

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INTRODUCTION
A revival of interest among development agencies in business development services (BDS)
for small and medium-sized enterprise (SME) development has resulted in agreement on
guiding principles of sound practice and the development of more rigorous performance
frameworks, mirroring earlier developments in microfinance. It is now clear that the priority
of organizations in the BDS industry globally is to turn this wave of interest and learning into
improved practice in the design and management of effective BDS.
This guide seeks to contribute to this challenge by laying out a set of core skills and
frameworks that take these guiding principles and move them closer to foundation
practices when the goal—and this is the key difference compared with “traditional”
approaches—is to make BDS markets work for SMEs. The pursuit of this goal requires a
new, or at least modified, set of core skills and practices in conceptualizing BDS in the new
market development paradigm; diagnosing market problems as the basis for intervention;
making informed decisions on strategy, intervention options, and partners and their roles;
financing interventions with the right type of incentives and subsidies; and evaluating desired
changes and monitoring the impact of BDS interventions.
This guide draws on recent experience from BDS projects, case study research, workshops,
and seminars that have identified the critical gaps in what we know and what we need to
know to turn these guiding principles into best practices. To date, there is no body of
practical experience in the BDS market development approach that could provide irrefutable
evidence that BDS markets are working better for SMEs as a result of specific interventions.
However, a body of practical experience is emerging, as pioneering initiatives are launched
that focus on developing new BDS products, managing voucher schemes, fostering business
networks and linkages, and experimenting with cost-effective management information
systems, to name a few.
This guide is a call to action for relevant parties—donors, providers, facilitators, and
researchers—that have as their goal to make BDS markets work for SMEs. The authors
hope that the concepts, frameworks, and tools presented serve as useful and practical guides
in the pursuit of this goal.