Managing for results
Comprehensive thinking
[ By Stefan Schmitz ]
More and more aid is being pledged internationally, and, at the same time, the competition for scant resources is getting tougher. Donors, charitable foundations and civil-society organisations will have to become able to report clear results, and that is true of developing countries’ governments too. As aid recipients, they are – at least in part – responsible for the efficient implementation of development aid, the effective utilisation of all external resources (including direct investments) and domestic means such as commodity revenues and taxes.
Over the past decades, clearly attributable development success has been scarce. Therefore, the global development agenda has been rewritten. A reform process was started to increase accountability and effectiveness. The framework for measuring development results is now defined by the UN Millennium Development Goals (MDGs).
The Monterrey Consensus, various debt-relief initiatives and poverty-reduction strategies have shown that more and better aid has to go along with stringent results-orientation in the partner countries. The Paris Declaration on Aid Effectiveness spells out the principles of ownership of developing countries as well as better alignment and harmonisation of donors. The Declaration also stresses two more principles: managing for development results (MfDR) and mutual accountability. So far, the latter two have been overshadowed by the former three “pillars” of the Declaration.
This must change. For the sake of aid effectiveness, reporting duties, results-oriented action and ongoing performance assessments are essential. They will only be accomplished, however, where there is the political will. Resources have to be made available in an intelligent way.
Common misunderstandings
As far as results-orientation is concerned, some mistakes persist. Managing for results
– is not merely about administering and distributing aid effectively. Rather, this principle must apply to the entire public administration, encompassing the wide range of external and internal resources the public sector uses to start and direct development;
– does not consist of technical user manuals and IT-compatible procedures. Rather, it is a comprehensive way of thinking geared to fostering a “culture of results-orientation“. Enforcement at all levels requires political leadership and determination as well as appropriate capacities.
Member countries of the OECD have many years of experience in public sector reforms. They have tackled performance issues in attempts to serve citizens well. The change from conventional top-down public administration, which basically sees citizens as subjects, to a more up-to-date approach, which treats citizens as customers, is time consuming and arduous. This is particularly so in developing countries that are typically marked by weak capacities and institutional environments.
The results of the Survey on Monitoring the Paris Declaration were revealing. In 2007, only three developing countries – Mozambique, Uganda and Tanzania – met the institutional requirements for adequately assessing developmental progress. This year, 15 countries are expected to meet these requirements.
Results-oriented management is of extreme importance in developing countries. The degree to which lack of capacities (in terms of strategic planning, resource allocation, impact assessment and feedback to political decisionmaking, for instance) hampers development is increasingly becoming evident. Problems are exacerbated by the public only being inadequately informed. Moreover, civil society and the private sector are hardly ever involved in decisionmaking, and government action tends to be only insufficiently controlled by national parliaments.
In developing countries that aim for stronger results-orientation, public-sector reform cannot simply be done by decree. Reforms have to be designed and enforced with plenty of patience and diligence. Long-term political commitment is necessary, of course, and so is capacity building.
Cultural change
Ultimately, matters hinge on “cultural change.” For that to happen, a specific environment needs to be created. It must facilitate and reinforce exchange of experience, thus promoting learning by all parties involved. In view of the challenges, the so-called “communities of practice on MfDR” in Asia, Africa and Latin America are quite promising. These networks of learning are predominantly self-organised. To a large extent, their operations do not depend on donors. Within the civil services of member countries, these networks are increasingly becoming advocates and even promoters of evidence-based results orientation.
The international aid-effectiveness debate is focussed on developing countries and their needs. The consolidation of democratic responsibility is considered a key element. However, many donors have not yet done their homework. Though developing countries’ efforts to build capacities deserve support, coordinated donor projects that are tailored to assist their public-sector reforms remain exceptional.
The Paris Agenda has helped donors understand that the best way to support public-finance management and public procurement in developing countries is by relying on their national systems. Donors must not insist on their own procedures. Understood adequately, managing for results implies developing countries’ national systems must be made use of. It does not make sense for donors to use performance indicators and reporting systems of their own. Developing countries have to assume the responsibility for monitoring results and reporting needs. Donors have unmistakably committed to this principle in the Paris Declaration (§ 45).
Another important issue is the stringent results-oriented management within donor agencies. Country programmes must be designed accordingly. Available resources have to be assigned to meet objectives. Moreover, results-oriented reporting and accountability have to be strengthened, and care must be taken to ensure that target agreements for the various organisational levels are implemented consistently. It is of particular relevance to set appropriate incentives to ensure that all stakeholders cooperate in the best possible way. Motivational hurdles that stem from legal and administrative procedures or deeply entrenched behavioural routines have to be done away with. Once more, professional leadership is needed along with the ability to assume and – where and if necessary – assign responsibilities.
The implementation of MfDR requires political will, change management as well as listening to and learning from each other. Policymakers should not fall for the temptations of short-term results that are hardly sustainable even though they may look good at first glance.
In the long run, scarce resources will only be used effectively if the results-orientation of public administrations improves and boosts performance. The more reform processes strengthen accountability – towards parliaments, the general public as well as donors and recipient governments – the better the outcome will be.