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DO PRODUCTION STRUCTURES IMPACT RURAL COMMUNITIES' SUCCESS PROSPECTS?


 

" The Garden of Eden symbolizes an earthly paradise, and with thoughtful actions, we can recreate such prosperity globally."

 

Reflecting on my Kibbutz, where I was born, grew up, went to school, and worked, I envision red-roofed houses surrounded by huge green lawns filling the spaces between them.


This idyllic view of my Kibbutz remained until recently.


However, everything changed when I delved into the foundations and essence of the Kibbutz, uncovering its business structure and the reasons for its phenomenal economic success.


This exploration revealed a new facet: the Kibbutz is not just a simple, innocent organization but a well-oiled, infinitely efficient machine that is humane and compassionate.


This week, we will add another layer to the Kibbutz's business structure.


The Kibbutz is often referred to as the Garden of Eden on Earth, the same word for Paradise and Heaven in Hebrew.


This raises the question: What makes this paradise possible from a business, social, and organizational perspective? More importantly, can this model be replicated globally to create similar paradises elsewhere?


To understand this, we will compare the two most common production models in human history: the traditional craft production model that dominated before the Industrial Revolution and the assembly line production model that emerged from it.


Which model aligns better with smallholders, and which with that of the Kibbutz?

 


THE TRADITIONAL CRAFT PRODUCTION MODEL


Before the Industrial Revolution, businesses were typically small workshops, farms, or family businesses where each individual was involved in every step of the production process.


Workers developed a broad set of skills and were responsible for creating entire products from start to finish.

 



 

Advantages:

  • High-quality and unique products due to individual craftsmanship.

  • Craftsmen develop a wide range of skills.

  • Products can be easily customized to meet specific customer needs.

  • High job satisfaction from creating an entire product.


Disadvantages:

  • Limited scalability and low production volume.

  • Higher costs due to time-consuming work.

  • Variability in quality due to skill level differences.

  • High dependency on individual craftsmen's availability and skill.


Which group does this production structure resemble: smallholders, professional farmers, or Kibbutz members?

 


INDUSTRIAL REVOLUTION AND ASSEMBLY LINE PRODUCTION STRUCTURE


The combined impact of the Industrial Revolution (1760-1840) and the introduction of the Assembly Line method (1913) revolutionized production.


Starting from the Industrial Revolution, workers were assigned specific tasks, specializing in one stage of the production process—this increased efficiency and output.


In our discussion, unless otherwise said, although separated by time, the Industrial Revolution also includes the Assembly Line production revolution.


Did the Industrial Revolution change how farming and the agro sector are practiced?


Some, like National Geographic, present the Industrial Revolution by emphasizing the impact of mechanization on farming without mentioning the impact of the Assembly/Production Line, which is an integral part of it, though the Assembly Line appeared later.


This oversight has proven significant when analyzing poverty's roots and identifying actions needed to foster prosperity in rural communities.


The illustration below shows how the combined impact of the Industrial Revolution and the Assembly Line created a novel production structure. Under this novel approach, each production line is operated by dedicated workers/teams, each responsible for one step/phase in the entire production structure.

 



 

Advantages:

  • Mass production capability with higher output.

  • Reduced costs due to economies of scale.

  • Increased efficiency and faster production times.

  • Consistent quality and product standardization.

  • Workers specialize in single tasks, increasing proficiency.


Disadvantages:

  • Monotonous and less fulfilling work.

  • Limited skill development as tasks are repetitive.

  • Less flexibility for customization.

  • High dependency on the smooth functioning of the entire production line.


Which group's production structure resembles this: smallholders, professional farmers, or Kibbutz members?


 

SUMMARY: PRODUCTION STRUCTURES’ UPS AND DOWNS


Over the past 11,000 years, we've seen two major production structures. The table below summarizes their advantages and disadvantages: 



 

We may have differing opinions on whether product quality is inherently higher when produced individually by a craftsman per a client's request.


However, more importantly, the feature of scalability, which was nearly irrelevant for thousands of years as food production was primarily for family consumption, has now become crucial.


Post-Industrial Revolution, scalability emerged as the most critical determinant of business success.


When scalability is the goal, features that support mass production are prioritized, often at the expense of other aspects.


Social and personal-oriented features, vital in the past when communities were smaller and more self-contained, now hinder scalability.


The differences between Pre-Industrial Revolution and Post-Industrial Revolution production models lie in the features that support scalability, such as lower skill requirements, higher production speed, and cost efficiency through large-scale operations.


Consequently, in the Post-Industrial Revolution era, scalability equates to prosperity.

Looking at the comparison table, it's evident that smallholders align with the pre-Industrial Revolution production model.


Like any industry, agriculture's potential economic success suffers significantly when scalability is limited.


By nature, smallholders are prone to poverty or low-income potential and will continue to face these challenges until scalability is well addressed.


Can smallholders overcome the disadvantages posed by a lack of scalability?


It's important to acknowledge that scalability has its downsides. Achieving business scalability often comes at social and personal costs, prompting some to resist despite financial gains.


Scalability can also compromise quality, individuality, and other valuable features, which is why handmade items like a Bugatti car or an original Picasso painting command higher prices compared to their mass-produced counterparts.


Is there a way to bridge these seemingly contradictory features? Can we create a model where industry and agro-industry coexist harmoniously, providing both economic efficiency and a sense of home and community?

 


THE KIBBUTZ PRODUCTION STRUCTURE 


While smallholders operate within a Pre-Industrial Revolution framework, the Kibbutz model seamlessly integrates the scalability of industrial methods with the enriching aspects of communal living.


As we delve deeper into the scalability dynamics, it becomes evident that this trait is a pivotal indicator of business triumph.


So, how does the Kibbutz production structure fare when compared to the pre and post-Industrial Revolution paradigms we've scrutinized thus far?

Prepare for surprises.


The Kibbutz production structure is ingeniously organized into 'branches,' each functioning as an autonomous economic entity similar to modern production lines.


Within this framework, every branch operates like a Post-Industrial Revolution Production Line, optimized for efficiency and output.


I worked in many branches of the Kibbutz but fell in love with the orchard branch.


This branch operates as a business unit housing several "Production Lines," encompassing apples, wine grapes, olives, and more.


Similarly, other branches cover diverse sectors such as animal husbandry, open-field crops, industrial manufacturing, and tourism.


Each branch further subdivides into multiple production lines, with dedicated workers or teams overseeing each step of the process.


In a traditional corporate setting, every production line boasts its manager, while the company's managerial tier embodies overarching leadership.


This structure parallels the Kibbutz business manager, who oversees all branch managers, ensuring seamless coordination and resource optimization.


The visual representation below outlines three Kibbutz branches, each housing a single production line, although, in reality, each of those branches has several "production lines".


Every worker or team contributes to their designated step within this system, leveraging specialized expertise.


Yet, its flexibility sets the Kibbutz apart, allowing even non-professional individuals to grasp and excel in various branches swiftly.


My mother and her friends exemplified this, establishing the Kibbutz, knowing little or nothing about agriculture, industry, tourism, etc., but excelling in each.


This elucidates how individuals, regardless of prior training or expertise, can swiftly adapt and thrive within the Kibbutz framework, achieving remarkable business outcomes.

 



 

Indeed, it's remarkable to recognize how the Kibbutz production structure mirrors the Post-Industrial Revolution approach applied to agriculture and various industries.


Even more astonishing is the timeline: the Kibbutz model was conceived and implemented in agriculture as early as 1910, a noteworthy three years ahead of Henry Ford's revolutionary Assembly Line method in 1913.


Yes, the roots of the assembly line concept, which farmers like to hate because it is "industrial", sprouted in the unlikeliest places – the farms!


But that's just the beginning.


Conventional businesses or factories have a distinct separation between where people live and where they work.


Work and home exist as separate entities, often in disparate locations.


However, within the Kibbutz, there's a unique integration – both "work" and "home" fall under the same organizational umbrella and geographical domain, belonging to the unified entity of the Kibbutz.


This integration was even more pronounced in the early 20th-century Kibbutz, fostering a greater sense of intimacy and unity.


In the Kibbutz lifestyle, members and their families resided and worked within the same compound.


In the Kibbutz, owners, managers, and workers are practically the same people, contributing to a profound sense of equality and shared responsibility.


This interconnectedness cultivated a deep motivation among members to prioritize the well-being of their fellow workers – essentially, themselves – and their families.

 


The table below briefly outlines the business and social advantages inherent in the Kibbutz model.



In examining traditional production structures, we uncover numerous social and personal benefits often associated with robust business features.


Conversely, the Post-Industrial Revolution heralds business scalability and efficiency but sometimes at the expense of social and personal elements.


Remarkably, the Kibbutz model bridges this gap, seamlessly blending the best of both realms.


But is this a flaw? Absolutely not.


Embracing roles as owner, manager, and worker within one's own enterprise, nestled within the communal fabric of the Kibbutz, profoundly impacts members' satisfaction, fostering heightened levels of life contentment, happiness, and even longevity, as previously explored.


Imagine being not just a worker but an integral part of your "big home," where every member is deeply interconnected within the Kibbutz compound.


This dynamic intertwining of work and home underscores the essence of the Kibbutz lifestyle, revealing yet another layer of its economic success.


This revelation prompts reflection on the Kibbutz's uniqueness and superiority over conventional rural communities, rooted in the foundation of the Industrial Revolution.


Within the Kibbutz framework, work, livelihood, and home converge harmoniously, nourishing a thriving environment for those adept at its practice.


Now, consider whether the Kibbutz production model harbors components exclusive to Israel.


If you're uncertain, ponder this: Did the Industrial Revolution confine its impact to England, or did the Assembly Line solely revolutionize the US upon its inception?


Indeed, just as these transformative forces transcended borders, the Kibbutz model's efficacy isn't tethered solely to its Israeli origins.


It beckons the possibility of Nova-Kibbutz communities thriving beyond Israel's borders, adhering to the same principles, and reaping comparable benefits.


Can farmers elsewhere benefit as significantly as their Israeli counterparts? What impedes us from pioneering Kibbutz-inspired models in regions where prior attempts at "more conventional" concepts have failed?


These questions beckon exploration. They hint at the potential for a global embrace of the Kibbutz ethos, promising prosperity beyond geographical confines.

 


IN SHORT


The journey from smallholders to scalability represents a significant transformation in agricultural and business practices.


By examining the traditional craft production model and the advancements brought by the Industrial Revolution, we see that scalability is a central feature required to achieve prosperity in today's world.


With its unique blend of efficient business practices and strong community bonds, the Kibbutz model offers a promising alternative that combines the best of both worlds.


The Kibbutz production structure, developed in 1910, parallels the Industrial Revolution's advancements and the Assembly Line method.


Its success lies in creating an environment where work, livelihood, and home life are intertwined, promoting high worker satisfaction, community well-being, and economic success.


This model's ability to balance scalability with social and personal fulfillment sets it apart from other rural community structures.


As we look towards the future, the question arises: can the principles of the Kibbutz be adapted globally to benefit rural communities outside of Israel?


The success of the Industrial Revolution and Assembly Line production models in various regions suggests that the Kibbutz model could similarly thrive elsewhere.

 


DON’T WAIT, ACT NOW


Consider the potential of implementing the Kibbutz model in your community or region.


Could this innovative structure help overcome the limitations of traditional smallholder farming and bring prosperity to your local economy?


Engage with the Nova-Kibbutz Stewardship Community, explore consultancy opportunities, and participate in programs that aim to export agro-produce using sustainable, scalable methods.


Join us in pioneering a new era of rural development, where economic success and community well-being are intertwined.


Share this vision with others, and let's work together to create a more prosperous future for rural communities worldwide.


 

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Here are four ways you can work with me to help your rural communities step forward to shift from poverty into ongoing prosperity:


* Consultancy on rural communities' models: Why, What, and How, e.g., based on the Kibbutz and Moshav lifestyle models.

 

* Local & National programs related to agro-produce export models - Dream Valley global vertical value and supply chain business model and concept connects (a) input suppliers with farmers in developing economies and (b) those farmers with consumers in premium markets.

 

* Crop protection: Biofeed, an eco-friendly zero-spray control technology and protocol solution, is most suitable for developing countries.

 

* IBMA Conference - To learn, share, and practice novel business models: the IBMA 2025 conference theme is “Reshaping Agribusiness Models for Building Prosperous Rural Communities." Register now or contact me.

 

 

 

TAKEAWAY MESSAGES


Ø  Scalability is a central feature required to reach prosperity.

Ø  The Kibbutz business production structure is similar to the Industrial Revolution and Assembly Line production structure model.

Ø  The Kibbutz model blends efficient business practices with high worker satisfaction and community well-being.

Ø  The kibbutz structure can be adapted globally for the prosperity of rural communities.

 

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More on the October 7th genocide in South Israel:

 


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If you got to here, read this column, and enjoyed it, please be nice to your friends, share it with them, or help them Subscribe.

"Mental and Economic Freedom Are Interconnected."

 

See you soon,

Nimrod


 










Dr. Nimrod Israely is the CEO and Founder of Dream Valley and Biofeed companies and the Chairman and Co-founder of the IBMA conference. +972-54-2523425 (WhatsApp), or email nisraely@biofeed.co.il

 

 

P.S.

If you missed it, here is a link to last week's blog, “From Risk to Resilience: The Kibbutz Approach to Ending Farmers' Poverty."

 

P.P.S.

OPEN BUSINESS OPPORTUNITIES:

1)     Exporting fresh fruits from Africa to the EU under the Dream Valley regenerative protocol brand for the 2024 season.

2)     Joining the Nova-Kibbutz concept project or establishing a similar initiative in your region.

Kindly provide your background and credentials to receive tailored next-step instructions.

 

P.P.P.S.

Dream Valley is a field-proven disruptive business model based on the successful Israeli Model.

 

You can follow me on LinkedIn, YouTube, and Facebook. 

*This article addresses general phenomena. The mention of a country/continent is used for illustration purposes only.

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