Learning Resource

Module 4 – Defining a Cost-Effective Product Delivery Strategy

Overview:

This module addresses some of the best practices and principles informing cost-effective product delivery.  After analyzing agricultural markets and identifying targeted clients, the design process leads to a client-focused, tailored product prototype, which is then adapted to reflect identified risks and embedded risk management.  In this module, we face the test of determining how to deliver the product so it continues to offer a strong value proposition while at the same time meeting management expectations about commercial returns.  A variety of examples from different financial institutions help to demonstrate alternative approaches, including risk and cost-transfer through partnerships – which will be the focus of Module 5.
Total time required for standard delivery of the module: 2 hours

Objectives (OBJ)

1.       Articulate three common principles for cost-effective delivery of agricultural finance products

2.       Draw lessons from institutions’ varied approaches to financial product delivery

3.       Identify major factors influencing the financial viability of a delivery strategy

4.       Design a product delivery strategy that applies lessons learned
 

Key Takeaways (KT)

1.       To facilitate cost-effective product delivery, use local channels and build win-win collaborative relationships.

2.       Transfer the cost of non-financial services away from financial institutions to specialized partners.

3.       Since cost-effective solutions are often found in unexpected places, financial market assessment needs to identify all relationships and communication channels in a targeted market.

4.       Knowing management expectations on rates of return and profits at the beginning of the process will enable the design of a feasible delivery strategy.