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“An introduction to market systems development”

Practical Action is one of many organisations taking a market systems development approach. This video, from the BEAM Exchange, helps to clarify what this means. It is a useful way of seeing how the Systems Thinking principle is put into practice specifically in the context of markets.

“What’s different about the market systems approach?”

This second video, also from the BEAM Exchange, goes deeper into the principles and methods of MSD, emphasising the importance of scale and sustainability.

​So, how is PMSD different from mainstream MSD?

PMSD shares many common features with the wider MSD sector. The key difference lies in the Participation principle which is manifested in two ways:

Firstly PMSD puts a greater emphasis on understanding, engaging and empowering marginalised groups as legitimate market actors in their own right. This comes from a long history of Practical Action’s work in communities, and a desire to avoid assuming that market benefits will ‘trickle down’ to the poor.

Secondly, PMSD supports local  market actors to develop relationships and to collaborate to address systemic problems. Mainstream MSD rarely does this – tending to focus more on individual firms. In PMSD, we support market actors to analyse their market system themselves and address problems together, which supports the development of adaptive capacity and resilience.

In order to achieve this, our staff need to understand the dynamics of the wider system, speak the language of business, and facilitate relationships with senior leaders and influential market players. At the same time, they need to be located close enough to local communities to spend time, build trust and understand the nuances of local cultures, norms and institutions. There may be a perceived trade-off between depth (ensuring market changes benefit specific target groups in a particular area) and breadth (reaching larger numbers of people through partnering with larger market actors who have more reach). Nonetheless, PMSD at its core, takes up this challenge and in doing so provides a unique perspective on how to ensure market systems approaches achieve their promise.