LESSONS OF EXPERIENCE AND GUIDING PRINCIPLES
TABLE OF CONTENTS
I. DEFINITIONS AND CONCEPTS
II. CAPACITY ASSESSMENT
III. CAPACITY DEVELOPMENT STRATEGIES
IV. TECHNICAL COOPERATION AND CAPACITY DEVELOPMENT
V. MONITORING AND EVALUATION
LESSONS OF EXPERIENCE AND GUIDING PRINCIPLES
This document is intended to assist UNDP country offices to understand more clearly how to support governments in the development of national capacity. The document is not a manual or handbook, and does not provide instructions, but draws upon lessons learned in order to set out guiding principles for capacity development. It has emerged from a long process of discussion, evaluation, acquisition of experience by UNDP and other donors, from publications and from practice. It has also built upon a research project financed by UNDP and undertaken during 1992-1994, supervised by the Harvard Institute for International Development with case study research conducted by national researchers in Bolivia, Central African Republic, Ghana, Morocco, Sri Lanka and Tanzania. The research project involved the cooperation of UNDP, the World Bank and the United Nations Department for Development Support and Management Services, and provided the opportunity for staff of the three institutions to discuss with the national researchers and the Harvard team what is the meaning of 'capacity', how it can be better understood and how national capacity development can be supported more effectively by donors.
The document is intended to be 'generic', that is, applicable to capacity development in any area and for any purpose. It is hoped that the document provides a framework that will be relevant and useful for capacity development in broad areas such as gender equality, or environmental sustainability, as well as for more specific purposes such as macro-economic management. It is also hoped that experiences in using the framework will be fed back into the process of revision and refinement, and that the framework itself will develop and become increasingly infused with the lessons of experience. In particular the document has not incorporated the experience of capacity development and technical cooperation in Eastern Europe and the Commonwealth of Independent States, and it is hoped that future revisions of the document will reflect the lessons of this more recent experience.
The first section provides a discussion of the definition and scope of capacity development, indicating that capacity can be understood as 'the capability to perform functions effectively'. In understanding capacity problems and constraints, five levels of analysis are outlined. In the second section, these five levels reappear as the five steps in a process of capacity assessment. A capacity assessment is a vital initial stage in formulating a capacity development strategy and lays the basis for understanding the capacity problems in a country, why they have emerged, what approaches to capacity development have been taken in the past, and what have been the effects. On the basis of the capacity assessment, a range of options for capacity development can be identified.
The third section discusses the process of formulation of capacity development strategies and emphasizes the importance of participation by national institutions, both governmental and non-governmental, in this process. The section also provides an indication of the nature of capacity development strategies and the centrality of vision and political commitment. The fourth section provides an indication of how donor-financed technical cooperation can support strategies for national capacity development. Finally, the fifth section discusses issues of monitoring and evaluation of capacity development.
I. DEFINITIONS AND CONCEPTS
The terms 'capacity', 'capacity building' and 'capacity development' have been used increasingly by the development community in recent years, often replacing the terms 'institutions', 'institution-building' and 'institutional development'. Capacity development and institutional development are not identical concepts even though the two terms overlap to a considerable extent.
Capacity can be defined as the ability of individuals and organizations or organizational units to perform functions effectively, efficiently and sustainably. This definition has three important aspects: first, it indicates that capacity is not a passive state but is part of a continuing process; secondly, it ensures that human resources and the way in which they are utilized are central to capacity development; and thirdly, it requires that the overall context within which organizations undertake their functions will also be a key consideration in strategies for capacity development.
Capacity development is a broader concept than institutional development, and in addition to a concern with human resources and the development of institutions, it includes an emphasis on the overall environment within which organizations operate and interact. It includes, for example, concern for the functioning of the labour market, which determines how efficiently human resources are allocated among alternative uses; it also includes a concern for the capacity of institutions - especially in the public sector - to finance recurrent budgets, to provide adequate levels of salary to hire and retain qualified staff, to provide for adequate non-salary operating costs, and to implement transparent personnel policies based on merit and not solely on seniority or subjective criteria such as political connections.
The difference between capacity development and institutional development is mainly a difference of perspective. A capacity development approach requires that, even if the focus of concern is a specific capacity of an organization to perform a particular function, there must nevertheless always be a consideration of the overall policy environment and the coherence of specific actions with macro-level conditions. Capacity development is therefore concerned with the micro and macro factors that determine how institutions translate their capacities into actual performance.
The term 'capacity development' does not, of course, imply that there is no capacity in existence; capacity development includes the building up and strengthening of capacity but it also includes retaining existing capacity, improving the utilization of capacity, and retrieving capacity which has been eroded or destroyed. Thus capacity development does not take place simply through training and additional staff but requires that skilled people be used effectively, retained within organizations that need their skills, and motivated to perform their tasks.
During the past 50 years, developing countries have received significant flows of technical cooperation resources, much of which has been aimed at supporting institution- building or human resource development. While some important skills and institutions have been supported, it is clear that there have been problems of their sustainability. It is also clear that some of the ways in which technical cooperation resources are utilized have not supported capacity development and may even in some cases have contributed to the process of capacity destruction. This document aims to enable the capacity issues to be better understood in order to improve the contribution that technical cooperation can make to sustainable capacity development. The document also aims to assist in the assessment of capacity and the determination of levels of intervention for capacity-development activities. It is therefore an important complement to the Guidelines on the Programme Support Document, in which capacity development is the central focus for the formulation of UNDP-funded activities.
B. The five dimensions of capacity
Five dimensions of capacity have been identified as the major areas of analysis and the key levels of intervention.
First, training and education: effective performance of any function requires a well-trained human resource base of managerial, professional and technical personnel. This involves both specialized training and professional education, and in-service training needed for role-specific activities. This dimension is concerned with how people are educated and trained, and how they are attracted or directed to careers within particular organizations. Of the five dimensions, training and education has been best supported under conventional approaches to technical cooperation. The other four dimensions have often been underemphasized in the past.
Secondly, organizations and their management: effective performance requires the utilization and retention of skilled people. Thus, capacity development must include the organizational structures, processes and management systems, in particular the personnel management systems, which make the best use of skilled human resources, and which ensure their retention and continued motivation.
Thirdly, the network and linkages among organizations: there is a need to consider the network of organizations or institutions that facilitates or constrains the achievement of particular tasks. The accomplishment of many tasks requires the coordinated activities of a range of organizations and any particular organization may belong to several task networks. How these networks function, and the nature of formal and informal interactions among them, are important aspects of organizational performance. These networks will often straddle the public and private sectors even where primary responsibility for a function rests with a public sector organizational unit.
Fourthly, the public sector environment: the policy and institutional environment of the public sector is a major factor that constrains or facilitates organizational activities and affects their performance. This includes the laws, regulations and policies affecting the civil service, including hiring, promotion, salary structures and operating procedures, the budgetary support that allows organizations to carry out their tasks, the definitions of responsibilities among ministries or agencies, and the nature of the policy environment that supports or impedes the performance of functions.
Fifthly, the overall context: it is important to consider the broad action environment of the organization, beyond the public sector. This refers to the economic, social, cultural and political milieu in which organizations operate, and the extent to which conditions in this broader environment facilitate or constrain the functional capacity of organizations. For example, the level and rate of growth of output, changes in international markets for major imports and exports, and changes in aid policies of major donors are key economic factors that can constrain or facilitate capacity development. Politically, factors affecting capacity development include the degree of stability, the legitimacy of the government, the extent to which government actions are transparent and accountable, and the involvement of representative institutions and associations in debate and dialogue.
This framework is intended as a tool for assessing capacity problems and constraints, capacity gaps and opportunities. Strategies for capacity development can be focused on any level, but it is crucial that strategies are formulated on the basis of a sound analysis of all five levels.
C. The centrality of "capable governments" for development
Notwithstanding the reassessment of the role of governments in the economy and society that took place during the 1980s, there is now a broad consensus among development thinkers and practitioners that a "capable government", able to perform key functions effectively, is a precondition for development. Thus, most capacity-building analyses and strategies, and much donor support for capacity development, remain focused on the public sector. This is so, even though it is recognized that the role of non-governmental organizations will be more significant than in the past in all spheres of economic, social and political life in most countries, and that the interactions between non-governmental organizations and governments have contributed significantly to the emergence and legitimacy of capable governments.
Although there is no agreement on the appropriate role of the state, key functions for the public sector are often thought to include the establishment and maintenance of a judicial system that promotes human rights, law and order, and the protection and enforcement of property rights and contracts; the formulation and implementation of macro-economic policies that promote economic stability and sustainable economic growth; the protection of the environment; the formulation of social policies that promote equity and access to livelihoods for the population as a whole; the regulation of monopolies, internal and external trade; investment in and maintenance of the social and economic infrastructure, including health, education, research and development; and equitable access to information.
In short, there is a consensus that, even though private enterprise may play a significant role in social progress and economic growth, governments are ultimately responsible for creating the framework for development. This requires that within the public sector there is capacity to identify problems and to formulate and implement appropriate policies, to respond flexibly to public needs and demands and to rapidly changing international conditions, and to foster participation in debate and decision-making, so that key priorities reflect a consensus within society. The effective performance of the key functions also requires transparency and accountability. Capable governments are therefore associated with sound governance.
The development of the characteristics of a capable state is a long and difficult process of capacity building. It is a process that in many societies has involved setbacks and in some instances periods of capacity erosion or even destruction. The process of capacity building involves continuous development and effective use of human resources, constructive management of organizations, institutional contexts that facilitate performance, and economic, political and social conditions which support and sustain capacity.
II. CAPACITY ASSESSMENT
Capacity assessment is an essential basis for the formulation of coherent and effective strategies for capacity development. The functional approach to capacity development means that the most important initial step is to identify the key functions that are to be the focus of the capacity development strategy. The identification of these key functions might well involve a national dialogue and the building of consensus around a set of strategic priorities. The key priorities would also emerge from forums such as round tables and consultative groups, where national priorities and programmes are presented by government and discussed with donors. After the identification process, the next step would be a capacity assessment, involving an analysis of capacity issues, problems and trends at each of the five levels described above. In reverse order, this would involve the following:
(a) The overall context for capacity development: an examination of the broad economic, social, cultural and political conditions prevailing, and the resulting constraints on, and opportunities for, capacity development. It is important to stress that the context for capacity development must be seen as dynamic rather than static, and that major processes of change and trends in the context for capacity development should be assessed.
The overall context involves an assessment of major issues such as the following:
- The extent of political commitment to capacity development;
- The changing extent of the 'international brain drain', involving inflows and outflows of highly trained and experienced technical and professional people;
- The functioning of the labour market, and in broad terms the extent to which the labour market brings about an appropriate matching of jobs and skills in both public and private sectors. This should include an analysis of the 'domestic brain drain', especially the outflow of skilled people from the public sector;
- The standards prevailing in the major tertiary and professional training institutions within the country, and how those standards are changing over time, since specialized professional training is generally acquired as an addition to more general tertiary education. In some countries, declining standards in tertiary institutions have negatively affected capacity across the whole society;
- In many countries it will be essential to assess the extent and rate of change of the HIV/AIDS epidemic because of its observed high incidence among the educated;
- There may be aggregate factors that affect the environment for the performance of a specific function which will need to be assessed: for example, effectiveness of access to basic services in rural areas depends upon conditions of rural transportation.
These aggregate factors will in general have significant implications for capacity development. Where possible, constraints on capacity development deriving from the broader environment should be directly addressed at the policy level. For example, reducingthe rate of transmission of HIV is essential not only for general development and ethical reasons but also for the protection of society's human resource endowment. In the absence of policies to reduce the rate of transmission of HIV, strategies for capacity development are unlikely to succeed.
Furthermore, policies to reduce the degree of loss of the highly educated as a result of the international brain drain, or to encourage the return of emigrants, may make a significant contribution to capacity development and retrieval. In many countries, problems of capacity reflect the misallocation of resources, especially the underutilization of human skills. It is common in many countries to find that organizations, particularly in the public sector, cannot retain skilled people since they cannot compete with the overseas opportunities to which highly educated people have access. It is necessary for the capacity assessment exercise to indicate why these processes are continuing and to address these underlying causes of the capacity problem. In the absence of policies to improve the functioning of the labour market or to lower the level of the external brain drain, the social returns on further investment in high-level training and education will be unnecessarily low and other measures to support capacity development may be ineffective.
In certain extreme circumstances, such as civil war, political and social upheaval, where government actually or virtually ceases to function, it must be recognized that capacity development in the sense defined above may be impossible because the conditions prevailing are not conducive to development itself. In such situations, where UNDP programme activities continue, it would be necessary to search for and focus on longer-term building blocks for capacity development, such as support for basic education. However, in these very difficult circumstances it might not be possible to develop a programme of activities for capacity development because even such activities as basic education may be features of the political conflict, aside from the severe logistical problems surrounding the delivery of such services in these conditions.
The centrality of the overall environment to the success of capacity development strategies is increasingly clear, as is the level of political commitment to capacity development. Without a conducive environment, both external and domestic resources devoted to capacity development may be wasted. Thus, the assessment of the broad environment is a key stage in the formulation of a capacity development strategy; the strategy itself would need to include measures to influence that environment directly.
(b) The policy and institutional environment of the public sector: an examination of the overall environment of the public sector is the second key element of capacity assessment. This has three aspects: the regulatory, legal and budgetary framework of the public sector, the policy environment, in particular including overall economic management, and the pay and incentive systems as they affect performance.
The assessment of the regulatory and legal framework of the public sector includes the division of responsibilities among ministries and agencies as they affect the performance of key functions, the rules and regulations governing the activities of public sector organizations, the effectiveness of public auditing functions, and the nature of the overall relationship between the public sector, non-governmental and independent organizations, and the private sector.
The policy environment, including economic policy, has pervasive effects on the capability of any unit to perform its functions. It is necessary to assess budgetary procedures and allocative mechanisms that affect resource availability, the share of salaries in total operating budgets and the adequacy of non-salary budget allocations, which provide people with access to the equipment and materials they need in order to perform their tasks.
An assessment of the economic policy environment is also needed since it affects the performance of the function itself, for example the effectiveness of decentralized service delivery may depend on the overall adequacy of resources available to local governments; the delivery of services themselves require complementary availability and affordability of basic commodities (school books, pencils, vaccines, essential drugs, seedlings); and the willingness of government officials to locate themselves in remote areas to perform basic services will depend in turn on living conditions.
The specific policy framework for the performance of the function should also be examined, in terms of the extent to which the policies themselves facilitate or constrain capacity development. The capacity for policy-making should itself be examined, in terms of the effectiveness of policy capabilities.
The pay and incentive system is a critical element of capacity since incentives affect each individual's performance, motivation, willingness to remain in the public sector or even in the country, commitment to the job, etc. In extreme cases, real salaries have fallen below the level of a living wage, in which case it cannot be expected that individuals will perform effectively. Furthermore, non-monetary benefits have in many countries become an important element of real income but motivation has been adversely affected by inequitable access to such benefits.
Motivation has also been adversely affected in many countries by lack of management capacity, which is essential in creating the conditions in which people perform their functions and use their skills effectively. Management systems that emphasize recognition of individual achievements and merit-based promotion or incentives are extremely important in determining performance, even in conditions where salary levels are low. A critical review of managerial capacity is therefore an essential component of capacity assessment.
The assessment of the pay and incentive system involves an indication of the adequacy of overall levels of earnings in relation to the cost of living and how these have been changing over time, plus an assessment of the relative salaries for key categories of professional workers in the private sector compared with the public sector. In conditions where salary levels (including non-monetary benefits) of public sector professional, managerial and technical staff are lower than a living wage, and/or they are a small proportion of alternative earnings in the private sector, it is unlikely that capacity development strategies in the public sector will succeed unless there is serious commitment to reforms of public sector salary and personnel policies and major changes in personnel management systems. Piecemeal supplementation of salaries of individuals by donors in these conditions has tended to reduce the pressure for thorough reform yet has not constituted a solution to the capacity problems. Donor approaches which attempt to avoid the problems by creating parallel administrative arrangements have also not succeeded in building sustainable capacity and may have the effect of further weakening the public sector.
The incentive system includes broader factors than the pay and earnings system, however, as became clear from the research project findings. Factors such as conditions for children's education were found to be important in major decisions such as emigration but also affected the willingness of professional staff to relocate to rural areas to work in agricultural research stations or health institutions.
Capacity development strategies may therefore require a fundamental change in approach to public sector reform and to donor activities, with an emphasis on creating the conditions for a capable government rather than on particular quantitative targets for either the number of civil servants or the size of the public sector salary bill.
(c) The task network for the performance of the function: this involves a 'mapping' of the task network, that is, an examination of the array of current institutions engaged in the performance of this function and the interorganizational relationships involved in performing the function. This includes government or public sector organizations and the nature and effectiveness of their interactions with each other, plus their formal and informal relationships with private sector bodies, NGOs, research and educational institutions, relationships with regional and other overseas institutions, etc. The latter includes national and international professional associations.
The assessment of the task network involves examining the division of responsibilities among organizations and units, the quality of communications among organizations, both horizontally and vertically, and the extent to which the interrelations facilitate or
The Policy Context:
Examples from Morocco, Ghana and Sri Lanka
Agricultural extension in Morocco and Ghana was affected by the broader policy environment within the public sector. In both cases, economic reform programmes led to increased emphasis on agricultural production and a recognition of the important role that extension could play in raising production. In Ghana, this represented a turnaround from agricultural neglect; in Morocco, it meant a renewal and updating of approaches to agricultural development and extension. At the same time, privatization of such functions as marketing, input provision, and credit changed the job of extension agents, freeing them to focus on extension itself. In Ghana, agricultural sector reforms resulted in fertilizers and seeds being more easily available to maize farmers, although prices were sometimes high.
The budget process in both countries improved as a result of reforms, with more timely and effective programming of public expenditures. This should, in the future, help ministries of agriculture, including the extension departments, in planning their activities. Nevertheless, in Morocco, the timing of budgetary allocations meant that funds for extension activities arrived only after planting had been done, with the result that many activities could not be carried out when they would have been most effective. In addition, in neither country was budgetary support adequate for the provision of the facilities, housing, vehicles, and supplies needed for units and agents operating in the field, except where the extension service was supported by donors. Salaries and other benefits were low--indeed, the whole salary structure for extension agents in Ghana was set lower than that for other comparable civil servants--and opportunities for further training and promotion were limited.
The effects of broader policy goals can also be seen in Sri Lanka. The goal of reaching self-sufficiency in paddy production had largely been met, and the food crop extension service, which had aimed at reaching that goal, suffered from the lack of a new policy direction to define its mission. The extension service worked reasonably well, however. Then, in 1989, the government's major poverty alleviation campaign became the priority programme, and the extension agents in the field were diverted to other responsibilities. The result was a severe deterioration in the capacity to deliver extension services.
constrain or promote the capability to perform the function. It also includes an assessment of the nature and quality of relationships between providers and recipients of services, the extent to which there are mechanisms for service users to express their views about the quality of service in relation to need, and the extent to which service providers are responsive to users' needs and demands.
(d) The organization/unit in which the function is performed: this requires initially an examination of the quality of the performance of the function in relation to requirements. It is not always possible to assess performance in quantitative terms, thus qualitative assessment will usually be needed. An aspect of this is the extent to which the nature and adequacy of mechanisms enable users of the service or function to express their satisfaction, the alternatives open to them, and the responsiveness of the organization to indications of dissatisfaction.
Capacity Assessment and the Task Network
Lack of effective interaction among organizations in the task network can occur with regard to many different interactions that are important to performance. Coordination among organizations that set policy and those that implement it is critical if there is to be an adequate policy framework. Conversely, lack of an adequate policy framework can lead to insufficient coordination. In service delivery in particular, coordination is required among the network of organizational units that link the central government with the grass-roots, if the service is to reach its intended beneficiaries. This becomes even more difficult when there are lower levels of government with separate responsibility for the tasks. Coordination among different providers, including separate government programmes, private organizations, and donor projects, can present challenges. In addition, the quality of human resources can be affected by interactions between the training institutions and the organizations that rely on those personnel to accomplish their mission. Maternal-child health care in Tanzania suffered from lack of coordination in every one of these areas.
Extensive involvement in a task by donors, especially numerous donors, presents particular challenges for coordination of the task by government organizations. In Tanzania and Bolivia, maternal-child health services were delivered by different donors in different parts of the country. Often, each donor had its own priority concerns and approaches. Even when projects were located in the Ministry of Health, as in Bolivia, they still operated separately. While these resulted in better delivery of services in some areas, lack of coordination contributed to inadequate policy guidance, diminished control over resource allocation and use, and uneven coverage.
A frequent weakness in the task network was unidirectional communication, when two-way interaction was needed. This happened, for example, when a central organization transmitted instructions to lower-level units and did not allow them any input into decisions about programme design or implementation, as was the case in maternal-child health care programmes in the Central African Republic and Tanzania. It was also common in relations between organizations with responsibility for performing a task, on one hand, and the organizations that trained and recruited personnel, on the other. This was a constraint on budget formulation in Bolivia and Morocco and maternal-child health in Bolivia and Tanzania, among others. In Morocco, while training institutions trained people in fields relevant to the budget process and supplied personnel for the Ministry of Finance, the ministry had no involvement in designing programmes and little involvement in specifying what type of person it needed for particular jobs. In contrast, in the case of agriculture, the Ministry had a role in shaping what was included in training programmes, and it was active in pushing the recruitment office to supply the kinds of people it needed. Thus, in Morocco's agricultural extension service, these two-way interactions resulted in more appropriate training and a better ability to match job openings with qualified recruits.
Just as weaknesses in the task network can impede performance, effective interactions can support good performance. Furthermore, efforts to improve coordination in areas where it is weak can make a difference in the performance of a task. This was especially clear in Ghana, where inadequate coordination of the agricultural extension task as a whole and lack of effective interactions among various parts of it were identified as a problem and changes made to address them. The Department of Agricultural Extension Services was moved and strengthened to enable it to coordinate the activities of the many providers of extension services. In addition, the Ghana Grains Development Project, operating within the Crops Research Institute, worked closely with the Ministry of Food and Agriculture to link research, training, and extension more fully. It trained extension agents for the ministry and made sure, through regular interactions with farmers and extension agents, that the research and extension services were appropriate. These changes accounted for much of the improvement in performance in agricultural extension in Ghana.
It is also important to assess the organizational structures, management systems and processes that affect the recruitment, use and motivation of skilled personnel. This includes the extent to which individual initiative is encouraged and rewarded rather than stifled and penalized; the nature of the recruitment and promotion process and the extent to which it is transparent and merit-based; the role of leadership based on expertise rather than on position in the hierarchy or political connections; accessibility by employees, citizens or other stakeholders to data and information; and flexibility of the organization to respond to changing circumstances.
(e) The availability within the organization/unit of appropriately trained managerial, professional and technical personnel: ultimately, the capacity to perform any function effectively depends upon the quality of the managerial, professional and technical personnel, the quality of their training and the effectiveness with which their skills are utilized. Assessment of the adequacy of the quantity and quality of personnel available within any organization or unit must take account of the degree to which existing skills are appropriately utilized, and of the labour market conditions that affect the allocation of skilled labour.
On the basis of the assessment of capacity at each level, an analysis can be undertaken of the strengths and weaknesses of the present arrangements for the performance of the key functions, including reasons for the existence of the capacity problems, and why these problems have emerged. This should also include a discussion of past approaches to capacity building in the area and their successes and failures. Box 6 provides an illustration of the issues which might be included at each level in an assessment exercise for national statistical capacity.
III. CAPACITY DEVELOPMENT STRATEGIES
A participatory formulation process for a strategy for capacity development is essential to the success of the strategy itself. This is because capacity development must be seen as a national process, in which the role of donors is secondary and subordinate to national efforts. National political commitment to the strategy is the key to capacity development. Thus, the process will require involvement of and dialogue among national actors and stakeholders, involving representatives of an array of governmental and non-governmental institutions. Where appropriate, UNDP will assist the government in establishing this process of dialogue and in preparing the assessment and analysis of capacity problems.
Organizational incentive systems emerged as critically important in the studies of specific organizations. Despite the importance of financial incentives, non-monetary incentives played a very strong role in explaining good performance. Opportunities to study abroad, a sense of organizational mission, promotion for good performance, recognition or being singled out for excellent performance (as in employee of the month programmes, for example), friendly competitions to achieve performance goals, involvement in teamwork, and a series of other benefits were adopted as practices in the better performers. In agricultural extension in Morocco, for example, those selected as "best agricultural extension worker" in a region received special prizes and bonuses as did those who worked in areas where the "best farmer" was named.
In contrast, in poorly performing organizations, there were few incentives for professional staff to work or to strive for improved output. In Sri Lanka, when staff were asked to take on more work than others but promotion continued to be based on seniority, resentment undermined motivation to do well. Similarly, in Bolivia, hard-working, committed, and goal-oriented staff of the ministry of health were not rewarded, nor were the non-productive punished. As a result, the more motivated and better workers were easily attracted away to organizations or programmes that provided such non-monetary rewards. Organizations that focused on motivating staff, even in the absence of monetary rewards, consistently had better performance.
In the stronger performers, incentives for good performance were often matched by disincentives for poor performance. The ability to fire personnel for poor performance was particularly important. In Bolivia's NGO health programmes and Ghana's Crops Research Institute, an important aspect of personnel management was a probationary period followed by a review of the performance of the new recruit. Poor performance was dealt with by dismissal. In some of the organizations studied in Bolivia, Ghana, Morocco, and Sri Lanka, annual performance reviews were part of normal procedure. In cases in which these reviews were taken seriously and personnel rewarded or punished on the basis of successive reports, performance was stronger than in cases in which it was not possible to punish poor performance. Promotions based largely on seniority were shown to depress the level of commitment and performance of professional staff.
Recruitment. One of the clearest patterns to emerge in the case studies is the relationship between open and competitive recruitment procedures and performance. Without excepction, the organizations which were best able to recruit appropriate talent were those that had public announcements and competitions for
applicants, rigorous examinations or interviews, and a review board to ensure objectivity. This was the case with the Economic Policy Analysis Unit (UDAPE) in Bolivia; the Crop Research Institute in Ghana; the civil service generally in Morocco; and the Central Bank in Sri Lanka. In these cases, new recruits were eager to share in the organization's mission, to participate effectively in its culture and work toward its goals.
In addition, recruitment worked best to improve performance when it was managed by the organization rather than by the civil service or some other public sector entity. Ghana's CRI recruited its own scientists, but the Asuansi Farm Institute relied on the Public Service Institute for recruitment. Morocco's organizations suffered because a complex recruitment process placed considerable distance between their needs and the ability of the civil service to respond to them. In the public health sector in Bolivia, centralized hiring failed to respond to local needs. Organizations that could set standards for recruitment criteria and probationary periods were better able to encourage good performance.
Utilization. In Bolivia, Morocco, and Sri Lanka, the problem was frequently not so much the availability of well-prepared personnel but how they were utilized. Utilization is related to issues such as the structure of work, management systems and styles, and incentive systems within the organization. In several cases, professionals were sensitive to whether their jobs were meaningful and appropriate to their level of training. Where well-trained professionals--economists, doctors, or agricultural scientists, for example--spent considerable amounts of time in administrative activities and "pushing paper", they believed they were not being used well by their organization.
Thus, organizations need to consider carefully how to use professionals most effectively. When agricultural extension agents in Sri Lanka were assigned to general poverty alleviation tasks, their performance was poor. When the extension service was refocused on extension, bureaucratic requirements for reports ate into the amount of time agents could devote to farmers. In Bolivia, national health programmes could be adequately staffed in some categories but staff were poorly deployed and utilized. Morocco's extension workers were underutilized, given their level of training; clear specification of responsibilities and organizational relationships would have led to higher performance. The research indicated the desire of professionals to draw on their expertise and be involved meaningfully in an organizational mission.
Retention. Retention of qualified personnel was a major issue in all of the cases. Salary levels were important, particularly the necessity of a living wage. Beyond this, factors such as the sense of organizational mission, involvement, job satisfaction, professional identity, and recognition for good performance were central in explaining the ability of organizations to retain staff. These factors enabled some organizations to retain staff even when salary levels or job security declined. In one of the NGO health programmes in Bolivia, many employees had ten or more years of service despite very low salaries. Institutional loyalty and job satisfaction also helped ensure retention in the Department of National Planning in Sri Lanka despite low salaries. In the Budget Office in Bolivia, on the other hand, it was possible to attract well-trained officials but not to retain them because of the availability of more rewarding jobs elsewhere. More generally, the low prestige associated with working for the government in Bolivia made it difficult to retain professionals. In the health ministry, for example, there was a clear pattern in which professionals joined, benefited from training programmes, and then left government service. Highly politicized environments, in which non-merit considerations affected hiring and firing decisions, diminished the link between employment and performance and therefore had deleterious impacts on retention. This was the case generally in Bolivia and the Central African Republic.
The participation of both governmental and non-governmental institutions in the formulation process is essential both because of the need for a dialogue and consensus- building and because strategies for capacity development must involve a balance between public sector capacity and the capacity of non-governmental institutions and organizations. Development in general requires an effective public sector that can formulate and implement coherent and consistent policies, create an enabling environment for private sector development and the delivery of services to the population in ways that are responsive to the needs of society. Processes of national dialogue and interaction are essential to ensure responsiveness, accountability and transparency, which in turn depend on the capacity of institutions of civil society to engage in dialogue and act as channels for the expression of societal demands as well as alternative channels of service delivery in certain circumstances.
It is also important to stress that strategies for capacity development require a realistic time horizon since the building of capacity is a long-term process. The strategy will also need to be multilayered, in the sense of addressing the capacity constraints and problems at each of the five levels indicated above.
On the basis of the analysis derived from the capacity assessment, a range of options for reform will be identified. The options could range from measures aimed at strengthening the existing system, without any major structural reform in the institutions involved, to a major re-organization of functions and responsibilities, perhaps involving shifts in the division of labour between the public sector, the private sector and non-governmental institutions. In many countries, the capacity assessment will indicate that civil service reform is essential to capacity development, involving a process of rethinking the purpose and scope of government, improving recruitment, human resource management, improving compensation and incentive structures, improving budgeting and financial management, and adopting performance management systems to improve productivity. The capacity assessment may also indicate other issues at a macro-policy level that will need to be addressed.
The selection of options for reform is inevitably a political decision, which indicates clearly that capacity development strategies involve vision and political will. Vision is necessary in order to galvanize support for major reforms by focusing on the linkage of the reforms with larger socioeconomic development objectives. Considerable political will is needed to undertake major institutional reforms since this involves challenging vested interests with power bases derived from present arrangements. In the absence of political circumstances conducive to major reforms, alternative approaches will be selected which may represent a considerable waste of resources and a deferral of the solution to the capacity problem by temporarily strengthening the existing system.
For certain key areas, it may be appropriate to convene a seminar in which national authorities and non-governmental institutions discuss the options for capacity development and explore the implications of alternative paths. Once the broad strategy for capacity building has been defined, a detailed set of activities can be formulated for each level. These will include measures to enhance the quality, retention, utilization and motivation of human resources, support for institutions and inter-institutional mechanisms, support for policy capacity, and necessary changes in the policy environment governing the performance of the function.
Assessment of Capacity
Example: National Statistical Capacity
Within the broad area of economic management capacity, the following key functions are of critical importance in all countries:
- Economic policy analysis
- Development planning
- Investment programming
- Data collection and analysis
- Aid and debt management
The example of national statistical capacity can be taken as an illustration of the steps in the assessment of capacity. Important dimensions of statistical capacity are the capability to collect and analyse data, its accuracy, its timeliness, its usefulness and relevance for policy makers, and its usefulness, relevance and accessibility to non-governmental institutions and organizations, to the media, and to society at large.
In terms of assessment of statistical capacity, the following elements are important:
(a) The overall context: the degree of openness of government and access by civil society to recent data, even where such data conveys information about economic and social trends that are not very positive; the extent of international migration by statisticians, along with other categories of highly skilled people; the extent and ease of accessibility to data by branches of government and by non-governmental institutions; the infrastructure for data collection, for example the existence of national sample survey frameworks, trained survey teams; general accessibility and coverage of electronic means of data transmission and analysis, both within government, within universities and within society more generally;
(b) The policy and institutional environment of the public sector: this would include the division of responsibilities for data collection and analysis between units within government; the nature of policies towards data gathering and analysis, and towards data accessibility; the budgetary allocations to statistical offices and their adequacy in terms of salary and non-salary costs, including the adequacy of operating budgets to enable staff to perform their tasks; the levels of earnings of statisticians within the public sector, and comparison of salary levels paid within the private sector;
(c) The task network for national statistical capacity: the task network would include both the supply side (the collection and production of data), and the demand side (the uses to which data are put). On the supply side, the task network would include the central statistical office, the statistical units in other ministries and other national bodies such as the central bank, local and district government units which report data to national level ministries. The supply side would also include those institutions involved in training statisticians. The assessment of this task network would involve an examination of the relationships between units within the network, for example, the relationship between the data reporting units of local education and health authorities, how accurately such data are collected, how speedily they are transmitted and assembled, etc. On the demand side would be the major users of data, both policy makers within government, researchers within universities and institutes, NGOs, other non-governmental organizations, and the media. Assessment of the types of interrelationships between users and suppliers of data would be a major focus of attention;
(d) The organization/unit within which the function is performed: an assessment would be needed of the
quality of data produced by the statistical system, its accuracy, its timeliness, its relevance and usefulness to policy-makers and to non-government users, and the responsiveness of the statistical system to demands and needs expressed by data users. It would also be necessary to assess the structure of the statistical system, the motivation of staff, the nature of leadership, and the management system;
(e) The availability of appropriately trained managerial, professional and technical personnel: the availability of statisticians, standards prevailing in national and regional training institutions in which statisticians are trained, the national patterns of employment of statisticians, the quality of the personnel engaged in the collection and analysis of data, and in the decision-making process concerning priorities in data collection and analysis. The assessment would also include assessment of how effectively staff skills are utilized, how well staff are motivated and retained.
On the basis of such an assessment of national statistical capacity, it would be possible to examine the key problems and constraints: these may lie in the nature of relationships between users and producers of data, or in interrelationships between levels of government in data reporting; they may result from the inappropriate division of labour between governmental and non-governmental institutions in the collection and processing of data; they may lie in the ineffective motivation and utilization of staff, and in the absence of managerial capacity; or they may lie in the overall inadequacy of public sector salaries, which induces statisticians to leave public sector employment or to undertake second or third occupations. It would also be important to examine past approaches to development of national statistical capacity and the strengths and weaknesses of these approaches. On this basis, a set of options can be identified for alternative strategies for developing statistical capacity in the future.
Measures may also be formulated to increase demand for national professional capabilities, for example by developing national and regional consultancy capacity, promoting professional associations and networking, nationally, regionally and internationally.
Decisions concerning human resource development will involve, for example, choices among strengthening national training institutions, bringing expertise from abroad, long-term or short-term, or sending nationals to regional or to other overseas training institutions. Choices will also need to be made between the formation of new skills, the upgrading of existing skills, the improved utilization and allocation of existing skills, and the retrieval of skilled people from abroad or from other occupations where their skills are not utilized.
The strategy for capacity development will also require consideration of the building blocks for national capacity, for example the quality and quantity of primary and secondary education, as well as higher education and more specialized professional training.
Activities in support of capacity development can be formulated on the basis of projects or programmes. Specific and bounded activities within a narrow range of institutions may be formulated as stand-alone projects but will give necessary consideration to the macro-level policy conditions for their effectiveness, as well as the inter-institutional relationships surrounding the functions performed. Programmes involve the development by national authorities of a coherent capacity development strategy for a sector (e.g., the capacity for universal primary education) or sub-sector (e.g., the capacity to achieve 100 per cent adult literacy) or for a function which is multisectoral (e.g., the capacity to reduce the rate of transmission of HIV).
The formulation of the strategy for capacity development will also involve financial considerations, indicating sources of finance in the short and longer term. Even where donor support may be significant in the short term, it will be essential for sustainability that national resources are adequate to finance the entire programme in the medium and longer term.
Some of the key areas of focus of capacity development strategies at each of the levels of analysis are indicated below. These have emerged from the analysis of the research project on capacity building which was described briefly in the introduction to this document.
(a) The overall context for capacity development: although the overall context is the most remote and difficult to alter in the short or medium run, it has major implications for any capacity development effort. A strategy aimed at creating a conducive and supportive overall environment for capacity development might include the following key elements:
- Sustained investment in human resource development, including basic education and health care, and investment in skills;
- The promotion of broad-based and sustainable economic growth;
- The emergence of political institutions which mediate economic and social conflict and which provide opportunities for participation;
- The development of political support and public demand for effective performance by the public sector.
(b) The public sector institutional context: several broad principles emerge which are of key importance in developing a strategy for a conducive public sector institutional environment:
- The necessity for clear choices about which activities are essential for government to undertake, so that capacity development strategies can focus on them;
- Civil service reform programmes which focus on achieving positive goals of improving essential performance, rather than on achieving set numerical targets of size or cost savings. Even where downsizing is needed, this would need to be part of a more positively directed reform programme;
- Levels of public sector real earnings which provide a living wage, even if salary levels are lower than in the private sector;
- Levels of budgetary support which allow salaries to be paid regularly, which provide for necessary operating expenses, investment and maintenance, and with mechanisms to ensure that organizations actually receive the funds allocated to them;
- Expectations of good performance from the public sector, with attention on producing results rather than on conformity to rules;
- The introduction of flexibility into rules and regulations so that managers are able to use them effectively and apply problem-solving approaches.
Box 7 provides some illustrations of strategic issues linking capacity development and public sector reform.
(c) The task network for the performance of the function: networks are made up of many organizations and many types of interorganizational relationship, thus a strategy to develop capacity to perform a specific task will involve activities aimed at improvements in many different organizations and many different types of inter-organizational interaction. Important aspects of a strategy to develop capacity at the level of the task network would include the following:
- The targeting of efforts to improve parts of the task network that are the most important constraints on performance. Where specific organizations are identified as constraints on performance for the network as a whole, capacity development strategies can focus on them;
- Where constraints emerge from the interactions among organizations, these interactions would be the focus of capacity development strategies. This may involve revising the structural relationships of organizations, or it may involve the creation or strengthening of mechanisms of coordination. Formal mechanisms may need to be established but informal interactions would also be encouraged;
- The development or strengthening of systematic and regular mechanisms for bringing beneficiaries into the task network. This would involve two-way linkages and ways of ensuring that beneficiary groups have access to the policy dialogue.
Box 8 discusses some strategic issues of gender relations in the context of service delivery, based on the findings of the research project in Tanzania and Ghana.
(d) The organization within which the function is performed: a key aspect of capacity development at the level of organizations is a management-oriented strategy that provides meaningful jobs and incentives for goal-focused performance, creating the conditions in which individuals can use their initiatives, skills and experience effectively. Elements of a strategy would include:
- Salary levels that enable professional and technical staff to commit themselves to the organization;
- Basic systems and procedures that enable staff to know what must be done, when and how. This would include basic job descriptions, recruitment procedures, reporting relationships, supply lines, information systems, etc;
The researchers reported on programmes under way to try to make the public administration more conducive to good performance. The most ambitious of these were in Sri Lanka and Tanzania, where public sector-wide reviews of all aspects of administrative institutions were undertaken to serve as a basis for reform. These had not progressed very far toward implementation. Ghana's programme, while still ambitious, focused on several specific goals: improving top management, restructuring ministries to respond more effectively to tasks in a problem-solving way, and targeting key skills and training needs for development. Morocco's major efforts were more targeted toward particular sectors and task areas and combined reorganization, improvement in procedures and technologies, training, and incentives. In both Ghana and Morocco, performance improved as a result of these reforms. - Open and competitive recruitment procedures which ensure that those selected are chosen on the basis of merit and on the understandstanding that
performance counts. There will also need to be rules about remuneration, performance review, recognition, promotion and probationary periods which all send messages about performance expectations, and induction training which inculcates organizational norms and expectations;
- The capacity of organizations to provide professional and technical personnel with meaningful work and to share commitment to professional norms of behaviour;
- The building of a sense of mission for the organization and an organizational culture that encourages innovative responses to changing circumstances, problem identification and problem solving. This also requires that organizations have sufficient 'room for manoevre' to respond creatively to changing circumstances;
- The development of external demand for effective performance, by linking the pursuit of tasks by an organization with broader goals of government; by mobilizing users of services to communicate their satisfaction or dissatisfaction; by mobilizing demand for information and for good services; and by publicizing successes.
(e) The availability within the organization of managerial, technical and professional personnel: capacity development strategies in the past have often involved an emphasis on training, in particular training of professional and technical personnel. The capacity assessment may indicate that such training is essential, in particular the strengthening of national or regional training capacity. Some aspects of training may need more emphasis than in the past, however, such as management training. Furthermore, as indicated above, it may be necessary to stress the utilization of skills much more than in the past. Many aspects of recruitment, management and utilization of skills have been discussed above, but the key elements can be summarized as follows:
- Meaningful jobs assigned to those with appropriate skills and levels of training, to promote job satisfaction and motivation;
- Professional identification among staff, reinforced by professional associations outside the organization;
- Contracts of fixed duration with links to performance;
- Training opportunities linked to performance and commitment;
- Open and competitive recruitment procedures;
- Improved linkages between training institutions and task-oriented organizations;
- More emphasis on management training.
IV. TECHNICAL COOPERATION AND CAPACITY DEVELOPMENT
There has been much analysis of the role of technical cooperation in supporting national capacity building, by UNDP and other donors. Most of the analyses are critical of the achievements of technical cooperation, and there is much agreement that technical cooperation resources could and should be used more effectively. A major conclusion of many evaluations is that more attention must be paid to the sustainability of capacity that is supported by external assistance. It has also been accepted by all donors that external support in the form of technical cooperation for capacity development should be based upon national demand, formulated by means of a participatory process that ensures national ownership and transparency. This implies donor coordination and subordination of donor support to the national strategies and programmes.
The case for external support for capacity development to be based on the programme approach is very powerful: the programme approach as defined by UNDP requires full integration into national efforts and coherence with the macro-economic and sectoral frameworks. Effective capacity development requires that specific activities be formulated within a coherent overall framework, including institutional and inter-institutional arrangements and relationships, and the overall policy environment within which the activities are taking place. It can therefore be seen that capacity development and the programme approach are fully consistent with each other: indeed, each is dependent on the other.
In the design of donor support to national capacity development strategies, it is important to distinguish among technical cooperation that develops capacity; technical cooperation that may inadvertently undermine capacity; and technical cooperation that provides direct support or that fills gaps, which may be justifiable in certain circumstances but is not aimed at capacity development.
Not all forms of technical cooperation are necessarily conducive to national capacity development even though individually they may be highly valued by national authorities. An example is relief aid, which is an indispensable form of global solidarity. Even in such cases, however, there should be a concern to ensure that relief aid is not seen as totally separate from development processes, that the forms and mechanisms of relief aid do not undermine national capacity, and that where possible there is attention to the relief-to-development continuum. Furthermore, gap-filling technical cooperation may be valuable in some circumstances, but is aimed at getting the job done rather than at building national capacity to undertake key tasks.
Among the forms of technical cooperation that do not support capacity development, some may even cause damage to morale, productivity and good governance. One example is the setting up of project implementation units. In many countries, there has been a proliferation of special, separate project implementation units by donors for their own projects, without regard for the sustainability of the activities or for their integration with national efforts and national implementation capacity. In some cases, such special units have created problems of morale and motivation within those government departments whose functions have been taken over by the project implementation unit. Furthermore, the proliferation of such units has in some cases reduced the pressure for public sector reform, aside from being extremely costly in resource terms. A second example is the practice of ad hoc salary supplementation by donors, which undermines attempts to reform public sector salaries, creates large and irrational salary differentials among public sector officials, results in donor-driven reallocations of officials' time, and has associated negative effects on morale.
These examples of technical cooperation that undermines capacity are widespread, especially in countries with the most limited capacity. Such practices have the effect of intensifying the difficulties facing governments in bringing about the thorough reform of public sector functions, budgetary allocations and salaries needed to promote the emergence of a more capable and more stable public sector.
In circumstances where the strategy for capacity development has been formulated by means of a participatory national process, it becomes possible for technical cooperation to be genuinely demand driven and to respond to national needs. Forms of technical cooperation that may be most effective in supporting capacity development are: promotion of international and regional networking, including access to international professional associations; encouragement of new forms of international relationships, including technical cooperation among developing countries and economic cooperation among developing countries; institutional twinning; training, particularly in the form of support for the development of regional training and research institutions; more emphasis on management and leadership training; access to specific types of short-term expertise, from both national and international sources, where national authorities have generated the demand; and support for the development of a national consulting industry. Technical cooperation aimed at enabling a better utilization of existing skills is of particular importance.
The forms of technical cooperation that should be discouraged on the grounds that they have not supported sustainable capacity development include the following: project implementation units; long-term overseas training that is not clearly based on national need and demand; expertise where terms of reference have not been developed by national authorities; and ad hoc donor salary supplementation. In addition, the effectiveness of some traditional forms of technical cooperation, such as long-term resident experts working with national counterparts, has been increasingly called into question, especially in circumstances where the public sector institutional environment is not conducive to capacity development.
The transition to a different form of technical cooperation will not be easy since there is a powerful inertia surrounding present practices, both from the donor side and the recipient side. However, it is also widely acknowledged that there is a need for a radical change in the way in which technical cooperation resources are utilized, as both sides agree on its limitations and possible counterproductive effects. It may be useful to develop a set of targets and a time horizon, at the country level, based on agreement by government and donors. Some ideas on such targets were outlined by the Administrator in his speech to the DAC/UNDP/World Bank High-Level Seminar on Technical Cooperation which took place in June 1994. The types of targets that might be developed include the phasing out of all externally driven institutions, including project or programme implementation units and their full integration into the appropriate national institutions, within (for example) a five-year period; the commitment to base all donor support on the programme approach within a five year period, which would involve coordinated donor support for nationally identified and nationally driven programmes; agreement to integrate technical cooperation into national budgets within a five year period, accepting that this will undoubtedly involve reduced reliance on high-cost expertise from the major bilateral donors.
In order to support the emergence of capable governments, coordinated donor support is needed for civil service reform, involving improved overall incentive systems. This implies the ending of topping up systems, parallel administrations and project management units. Within the context of capacity development strategies, donors and governments would agree on the aims and norms for a solution to the problems of civil service salaries. The aims might involve changes in salary structures to provide incentives for increased productivity; and a system which, within a fixed period of time, could be sustained by the government without donor support. These changes should form part of Public Expenditure Reviews and Civil Service Reform Programmes. The conversion of some technical cooperation resources into targeted budgetary support for such reform programmes might make a significant contribution to the development of national capacity. Such budgetary support would involve greater flexibility and national control over external resources, with agreed performance indicators and accountability procedures. Donor willingness to transform technical cooperation into budgetary support in this way will depend upon national circumstances. Box 9 provides some further discussion of the issue of technical cooperation and public sector reform.
The principles indicated above concerning the formulation of technical cooperation activities in support of national capacity development strategies are fully consistent with the OECD/DAC "Principles for New Orientations in Technical Cooperation", approved by all bilateral donors in 1991. The implementation record of the DAC Principles has been uneven, and more needs to be done by all donors to improve this record. The processes outlined above for the formulation of national capacity development strategies may provide an effective basis for the fuller implementation of the DAC Principles. It may be useful in some countries to propose the establishment of a joint government-donor committee on technical cooperation to monitor the implementation of the DAC Principles and to develop a programme of specific targets to speed up their implementation. In view of the rather mixed record of technical cooperation in supporting capacity development, it has been acknowledged that the use of technical cooperation resources should change and that innovative approaches should be encouraged. In this process of innovation, more lessons will be learned about the most effective ways of supporting sustainable capacity development: it is essential that the lessons learned are disseminated widely and shared among donors and governments. The establishment of a national technical cooperation committee may be a vehicle for supporting improved practice and for disseminating lessons of experience more effectively.
The role of UNDP in supporting the strategy for capacity development can take a variety of forms. In particular, UNDP could support the initial step of identifying the critical functions which will be the subject of capacity development strategies, so that the strategies themselves are limited in scope and focused on key functions. UNDP would also support the capacity assessment and analysis, and the process of formulation of the national strategy. In formulating UNDP support to a particular national programme, decisions will be made on the basis of national demand plus UNDP's comparative advantages. The experience and effectiveness of UNDP in many areas should be an important determinant of the type of support that UNDP provides, for example TCDC, assistance with regional and international networking, institutional twinning, access to specific national expertise and to a global network of international expertise, and the development of national and regional professional training capacity. UNDP's neutrality may provide a basis for the use of UNDP support in areas such as national programme management, implementation and monitoring, and resource mobilization and management.
V. MONITORING AND EVALUATION
The monitoring and evaluation of capacity development is a complex task. One reason for this is that many factors influence the outcome of capacity development efforts, for example recession, war or natural disasters, which are beyond the control of governments and aid agencies and are not readily anticipated in the design of capacity development strategies. However, where the capacity assessment indicates that the overall context is not conducive to capacity development, the design of the strategy and interventions should take this into account and should focus on feasible and achievable capacity development objectives.
Monitoring and evaluation is also complex because much of the post hoc assessment of capacity will inevitably involve qualitative rather than quantitative judgement. For example, the quality of policy-making includes the quality of the process through which policies are made, the degree to which consensus building is sought, and hence the acceptability of the policies themselves.
Benchmarks for monitoring and evaluation will be developed at the design stage, reflecting the priorities selected for interventions, based on the analysis of critical constraints. It is important, however, that the monitoring process is as broad as possible in examining progress or lack of progress since achievements may be hindered by constraints that were not adequately addressed at the design stage. The monitoring process will provide an opportunity to reorient interventions accordingly.
Even where functions are defined narrowly and involve the action of only one organization or organizational unit, performance is likely to involve the coordinated activities and interactions of many organizations. Therefore, monitoring and evaluation must encompass the task network, which, as discussed above, may involve private as well as public sector organizations.
Monitoring and evaluation are themselves important functions for which capacity may need to be developed, and should be included in the specification of functions at the design stage.
Box 10 provides an indication of areas that might be included in the monitoring and evaluation exercises.
This analysis and review of experience indicates that capacity development is an complex process. It is a process that lends itself to analysis but does not easily lend itself to the preparation of a set of simple guidelines. The framework presented above is intended to provide a tool to assist in an analysis of capacity issues, to improve understanding, assessment and diagnosis of capacity problems, to facilitate identification of gaps and
Technical Cooperation and Public Sector Reform
In many countries, civil servants are paid less than a living wage. The findings of the research project on capacity building confirm that, in these conditions, public sector employees will be unable to perform their tasks and will seek alternative sources of income. 'Sunlighting', not just 'moonlighting' is very widespread. Donor responses to this have not, in general, contributed to a solution, and in many cases have intensified the problem. Very often donors provide piecemeal and arbitrary supplementation of salaries by a variety of different means to some public officials. This has resulted in chaotic earnings differentials unrelated to performance, experience, qualifications or any other objective standard. In these circumstances, 'technical cooperation' is frequently providing little support for capacity development, as its major contribution is effectively in the form supplementation of salaries and operating budgets. In reality, capacity development and the emergence of a 'capable state' cannot occur unless public sector officials are paid a living wage.
What should be the role of technical cooperation in these circumstances? As a precondition, it must be acknowledged by government and donors that the public sector institutional context is of paramount importance for sustainable capacity development. If there is political commitment to public sector reform aimed at capacity development, an analysis will be needed of existing public sector functions, and decisions made concerning those which must be performed by the public sector and those which can be performed by non-governmental institutions. This will involve politically difficult decisions, for example, ending the subsidization of parastatals such as electricity or telephone companies. Parastatals in many countries absorb a very significant share of public expenditure which is not justifiable either on economic or social grounds. Decisions such as this can only be made by national actors, and cannot be imposed by donors. The process of assessing functions, discussing options and arriving at consensus on a reform programme can be supported by external resources but not driven by external actors. Such a reform programme would enable a shift in the allocation of public expenditure and would release resources to pay higher salaries to public sector employees and to improve operation and maintenance budgets. External resources may also be available if donors would be willing to provide targeted budgetary support so that public sector salaries can be adjusted upwards in a rational manner over an agreed period. Without such reforms and accompanying changes in donor practice, which address the public sector institutional environment, interventions aimed at capacity development are unlikely to succeed.
In Ghana, donors have been supporting the government in a process of assessing capacity needs and developing strategies to meet these needs. A National Steering Committee was formed, and a national dialogue was initiated, involving the government and representatives of key social groups. Donors have participated in the discussions and have provided technical support for the process, for example in the assessment of capacity needs. National ownership and responsibility for setting priorities have been emphasized. This process is an essential step in creating a framework for technical cooperation to support sustainable capacity development.
formulation of strategies. It is important to stress that all of these are country-specific tasks and that all require a creative application and adaptation of the framework.
The results of the research project, which applied the framework in six very different country situations, are far reaching, and have fundamental implications for all actors engaged in capacity development, in particular for governments and for donors who support them. The implications include the need for a critical re-examination of approaches to
Monitoring and Evaluation of Capacity Development
Below is a summary of key elements, at each of the five levels, that might be included in the monitoring and evaluation. Most such exercises will involve an appropriate subset of these elements:
(a) The overall context:
- the rate of economic growth and improvements in social indicators
- comparative levels of public and private sector salaries and decompression of the wage structure
- degree of political stability and openness
- leadership commitment to a vision of national development
- investment in overall human resource development and in the physical infrastructure
- effectiveness of mechanisms for achieving social consensus
(b) The public sector institutional context:
- clarity of rules that facilitate action, and flexibility of rules to encourage problem-solving and innovation by organizations and officials
- extent to which recruitment and promotion reward merit and performance
- adequacy of budgetary resources for operating budgets and maintenance
- extent to which salaries provide a living wage and an adequate compensation to attract and retain qualified personnel
- formulation and implementation of reform programmes aimed at providing adequate salaries linked to performance; improvements in management; problem-solving orientation; elimination of unnecessary tasks; demand creation among users of services
(c) The task network:
- the coherence of policy frameworks that define goals for coordinated action
- clarity of organizational responsibilities
- effectiveness of specific mechanisms for interaction among organizations and incentives for individuals to interact with colleagues in other organizations
- effectiveness of horizontal interaction across organizations at policy, operational and field levels
- effectiveness of vertical interaction among levels of government engaged in performing a common task
- quality and effectiveness of common training institutes or programmes
(d) The organization:
- quality, quantity and timeliness of services provided in relation to organizational goals and client needs and expectations
- clarity of organizational mission and objectives
- relative levels of salary compared with equivalent private sector salaries
- flexibility and participation in work assignments and in decision-making
- extent of management focus on performance, incentives, participation and problem-solving
- extent of use of non-monetary incentives
- ability to demote and fire unproductive or unprofessional staff
- adequacy of physical environment, equipment and materials
- prestige of organization and existence of links to domestic and international professional associations or reference groups
(e) Recruitment, utilization and retention of human resources:
- extent to which recruitment is transparent, competitive and merit-based
- appropriateness of matching of skills with tasks
- regularity and seriousness of performance monitoring and review
- degree of job satisfaction and motivation
- linkage of training opportunities with performance and commitment
- managerial capacity and training
capacity development and to technical cooperation aimed at supporting national capacity development programmes. In developing national programmes, much more emphasis is needed on the assessment phase, and on the analysis of why capacity problems have emerged. Even where the focus of a programme is a very specific capacity, greater attention needs to be paid than in the past to the broader environment and the overall public sector context, and how far they constrain or facilitate capacity development. It is also essential that far greater attention be given to the issues of how skilled people are used, to the broad framework of incentives, and to the managerial capacity which is necessary for effective utilization, motivation and retention of skilled people.