THE CHALLENGE OF CAPACITY DEVELOPMENT: WORKING TOWARDS GOOD PRACTICE

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THE CHALLENGE OF CAPACITY DEVELOPMENT WORKING
TOWARDS GOOD PRACTICE

• Based on DAC Network on Governance
  DCD/DAC/GOVNET(2005)5/REV1,
• Feb.1, 2006

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CONTENTS

• Why focus on capacity?
• What has been learned?
• From emerging consensus to better practice on the
  ground
• Capacity development in fragile states
• Moving Forward Unfinished business
• Annex 1 Vicious and virtuous cycle of
  empowerment
• Annex 2 UNDPs default principles for capacity
  development

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I. WHY FOCUS ON CAPACITY DEVELOPMENT?
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Growing consensus on aid effectiveness and
capacity
The 2005 Paris Declaration on Aid
Effectiveness Calls for capacity development to
be an explicit objective of national development
poverty reduction strategies
The UN Millennium Project and the Commission for
Africa Challenges the world to treat capacity
development with greater urgency
The New Partnership for Africas Development
(NEPAD) Identified capacity constraints as a
major obstacle to sustainable development
Capacity Development One of the most
important elements of aid effectiveness
Without sufficient capacity, development efforts
will not succeed
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Challenge

• In recent years more than US15 billion (1/4th of
  donor aid) went to Technical Cooperation, most
  of which dealt with capacity development
• Despite these investments, development of
  sustainable capacity development remains one of
  the most difficult areas of international
  development practice
• Capacity Development one of the least responsive
  targets of donor assistance
• 2004 Global Monitoring Report for MDGs reveals
  that public sector capacity lagged behind all
  other MDG benchmarks

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contrast between
Difficulty of achieving Capacity Development
Increasingly recognized importance of
Capacity Development

• The Aim of the Paper

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Aims of the Paper
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Lesson Learned

• No quick fixes or easy formulas that work well in
  all circumstances
• There is a set of core issues which improve the
  results achieved in many particular settings

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Basic Understandings

• Capacity the ability of people, organizations
  and society as a whole to manage their affairs
  successfully
• Generic capacities the ability to plan manage
  organizational changes service improvements
• Specific capacities for e.g., public financial
  management or trade negotiations

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Relationship between capacity performance

• Analogous to a motor car
• We maintain the cars engine, chassis, brakes,
  tires, etc its capacity because we value safe
  reliable transportation the performance it
  provides
• In development, we are interested in factors that
  make possible strong performance in relation to
  development goals MDGs, which requires a clear
  understanding of the determinants

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Capacity Development

• The process whereby people, organizations
  society as a whole unleash, strengthens, creates,
  adapts maintain capacity over time
• Not the same as capacity building which
  suggests a process starting with a plain surface
  and involving the step-by-step erection of a new
  structure, based on preconceived designed

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Promotion of Capacity Development

• What outside partners domestic or foreign can
  do to support, facilitate or catalyze capacity
  development change processes
• Not equivalent to Technical Assistance or
  Technical Cooperation

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Relationship between Technical Assistance
Capacity Development
Facilitating access to knowledge
Brokering multi-stake-holder agreements
Capacity Development
Technical Assistance
Participating in policy dialogue advocacy
Providing incremental resources
Creating space for learning by doing
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Importance of Capacity Development
Two connected observations
Country Ownership is the cornerstone of aid
development effectiveness
Country capacity is the key to
Development Performance
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Level of Analysis
Capacity challenge is a Governance challenge
Individual level (experience, knowledge
technical skills)
Organizational level (systems, procedures rules)
Systemic factors, i.e., relationships between the
enabling environment, organizations and
individuals
Influences by means of incentives it creates
Enabling environment (institutional framework,
power structure influence)
Successful capacity development requires not only
skills organizational procedures, but also
incentives good governance
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Scope limits of Capacity Development
Building an effective state
Promotion of good governance
Institutional Development
Capacity Development
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II. WHAT HAS BEEN LEARNED?
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History

• Capacity and capacity development issues on the
  development agenda for ages, starting in the
  early 1950s
• Seen primarily as a technical process, involving
  transfer of knowledge from the North to the South
• Overestimated the ability of development
  cooperation to build capacity in the absence of
  national commitment
• LESSON LEARNED To be effective capacity
  development must be part of an endogenous process
  of change, with national ownership and leadership
  as the critical factors

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Agreement on DAC Principles for Effective Aid
(1992)
Shaping the 21st Century OECD DAC
paper outlining a new paradigm (1996)
Paris Declaration (2005)
The New Consensus Capacity development is the
prime responsibility of partner countries, with
donors playing a supporting role
Rome Declaration (2003)
Comprehensive Development Framework (CDF) (1998)
Poverty Reduction Strategy Paper
(PRSP) Initiative (1998)
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One of the most important element of the new
consensus

• Capacity Development is primarily the
  responsibility of partner countries with donors
  playing a supportive role

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The role of partner countries and donors in
capacity development

• Partner Countries
• Lead the process
• Set specific
• objectives in
• national
• development
• plans
• Implementation
• through country-led
• strategies

• Donor Countries
• Mobilize financial
• analytical support around
• partner countrys objectives,
• plans strategies
• Make full use of
• existing capacities
• Harmonize support
• for capacity development

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New emphasis on local ownership

• Recognition of the importance of political
  leadership and the governance system to create an
  enabling environment
• Ownership is processes trends not the presence
  or absence of a particular quality
• Ownership is not monolithic

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Forces influencing capacity development
BLOCKING FACTORS - NEGATIVE FORCES
Systemic factors, i.e., relationships between the
enabling environment, organizations and
individuals
Capacity Development
FACTORS FAVOURING - POSITIVE FORCES
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Conditions that make public sector capacity
difficult to develop

• Lack of a broadly enabling environment
• Lack of human security presence of armed
  conflict
• Poor economic policies discouraging pro-poor
  growth
• Weak scrutiny of the legislative branch on the
  executive branch
• Lack of effective voice of the intended
  beneficiaries
• Entrenched corruption
• Entrenched widespread clientelism or
  partimonialism

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Conditions that make public sector capacity
difficult to develop

• Aspects of government ineffectiveness environment
• Fragmented government with poor overall capacity
• Absent, non-credible and/or rapidly changing
  policies
• Unpredictable, unbalanced or inflexible funding
  staffing
• Poor public service conditions
• Segmented compartmentalized organizations
• Only a formal commitment to performance-oriented
  culture

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Conditions favouring capacity development in
organizations

• Strong pressures from outside
• Top management provides visible leadership for
  change, promotes a clear sense of mission,
  encourages participation, established explicit
  expectations about performance rewards
• Change management is approached in an integrated
  manner
• A critical mass of staff is involved
• Organizational innovations are tried, tested
  adapted
• Quick wins are celebrated
• Change process is strategically proactively
  managed

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Summary of lessons learned

• Capacity development involves three levels -
  individuals, organizational and enabling
  environment which are interdependent
• Capacity development goes well beyond Technical
  Cooperation and training approaches
• Incentives generated by organizations the
  overall environment is critical for using skilled
  personnel
• Capacity development is necessarily an endogenous
  process of change
• Focusing on capacity building of organizations
  make success more likely

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III. FROM EMERGING CONSENSUS TO BETTER PRACTICE
ON THE GROUND
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A framework for capacity development
Not a single, once-only sequence
STEPS LEVELS LEVELS LEVELS
STEPS Individual Organizational Enabling environment
Understanding the international and country contexts
Identifying supporting sources of country-owned change
Delivering support
Learning from experiences and sharing lessons
A flexible, best fit search for supporting
capacity development
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Individual level
STEPS STEPS
Understanding the international and country contexts How is the availability of skilled committed individuals shaped by global local push pull factors? Under what conditions could diasporas contribute more strongly to capacity development at home?
Identifying supporting sources of country-owned change Are individual professionals able to be mobilize? Are donor sufficiently responsive to restoring salary levels in key posts?
Delivering support Do training components take full advantage of the potential of ICT? Are the training components linked to increasing organizational effectiveness and putting new skills to use?
Learning from experiences and sharing lessons Does the follow u goes beyond knowledge livelihood benefits? Is it tracking the effects on organizational capacity performance?
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Organizational level
STEPS STEPS
Understanding the international and country contexts How are capacities currently shaped by the informal political aspects of organizations? Are these features generalized or variable across organizations or organizational spheres? Are there private-sector pressures resources that can be mobilized?
Identifying supporting sources of country-owned change Is capacity development an explicit objective of a plan or policy benefiting from country ownership? Is there effective ownership initiatives within particular organizations or organizational spheres?
Delivering support Have the objectives been clearly defined in terms of desired capacity development outcomes? Have the inputs service providers selected with the view to cost effectiveness or the decisions been supply-driven?
Learning from experiences and sharing lessons Is the achievement of outcomes effectively monitored fed back into the process? Do the monitoring arrangements include proxy measures with appropriate involvement of clients or service users?
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Enabling environment
STEPS STEPS
Understanding the international and country contexts What are the historical contemporary factors underlying weak political will? How are power structures formal informal institutions changing and with what effects on politicians incentives?
Identifying supporting sources of country-owned change Does the interaction between donors and country actors form a virtuous circle or a vicious circle? Are there ways donors can encourage effective demand within the country for capacity development?
Delivering support Are the donors promoting changes in the institutional environment for capacity development? Is support being delivered in ways that enhance, or undermine, the possibility of organizations learning y doing?
Learning from experiences and sharing lessons Is there monitoring of changes in institutional rules how it has come about? Is there independent, objective monitoring pf the mode of delivery?
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Understanding the international country contexts

• A good understanding of context is fundamental
• Country political economy studies provide a
  valuable first step
• Important to get beneath the surface of the
  organization, looking for both formal informal,
  hidden aspects
• Identify the relevant stakeholders
• Donors should consider whether their own
  governments policies are part o the problem
• Consider the role of the diasporas

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Identifying supporting sources of country-owned
change

• Country ownership needs to be treated as a
  process
• The interaction between donors domestic actors
  can generate either vicious or virtuous circles
  of change
• Donors should encourage the effective demand
  for public sector capacity
• Modalities of donor support should encourage and
  strengthen initiatives benefiting from country
  commitment
• Capacity needs assessment a useful entry point
• Choosing the right organizational cope is as
  important as selecting the right organization
• Some organizations are more crucial than others

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Delivering support

• The enabling environment is still relevant when
  specific design issues are considered
• Technical cooperation is effective when pooled
  and coordinated
• Donor-instigated Project Implementation Units
  (PIUs) should be avoided whenever possible
• Agreeing the desired outcomes of capacity
  development is crucial
• South-South learning should be encouraged
• Large new investments in training capacity may be
  justified

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Lessons learned about capacity development
through long-term training

• Better to aim at institutional changes in key
  organizations than focus on improving the
  capacity of individuals
• The gains in long-term training includes work
  attitudes, critical thinking, self-confidence,
  etc.
• Having a critical mass of staff in the same
  organization trained abroad in the same country
  make changes more possible
• Costs and benefits of different training options
  must be determined
• Follow up support in organizations essential
• Long-term commitment by donors is critical
• Source USAIDs African Graduate Fellowship
  (AFGRAD) and African Training for Leadership and
  Advanced Skills (ATLAS) Programme

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Learning from experience and sharing lessons

• Capacity development initiatives should maximize
  learning
• Further lessons must be extracted about what
  works and what does not in terms of changing the
  enabling environment
• Monitoring should also look into whether donor
  support is delivered in a way that assist country
  ownership
• An independent form of monitoring, capable of
  generating objective judgments is required
• Select and apply measures of achievement
• Collect the views of intended clients or
  end-users
• Individual assessment is not just about skill
  enhancement

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Summing up on operationalising the new consensus

• General formulas models do not produce
  sustainable benefits
• Approaches that achieve a best fit with the
  particular circumstances of the country, sector
  or organization is needed

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IV. CAPACITY DEVELOPMENT IN FRAGILE STATES
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Fragile States

• Most difficult aid environments that are being
  neglected by the international community
• Countries recovering from conflict
• Regimes that are chronically weak or in decline
• Capacity development must prioritize on reducing
  fragility

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General principles for working in fragile
development environments

• Development partners need to be highly selective
  in the instruments they use for capacity
  development
• Must understand the country context and focus on
  an approach suitable in the specific
  circumstances
• Must be realistic about their expectations
• Donors need to identify likely partners and work
  with them consistently over the short, medium and
  longer terms

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Lessons learned from working on capacity
development in fragile states

• Capacity development efforts must selectively
  focus on core state functions, so that they can
  effectively provide for their people
• Planning tools developed for post-conflict
  environments may be useful
• Respect the principle of endogenous change and
  foster country leadership
• New capacity development initiatives must not
  erode or duplicate existing capacities in
  individual, organizational or enabling
  environment terms
• Sectoral selectivity or partial alignment can
  deliver strategic pay-offs
• Modest capacity development can be achieved even
  in states with acute governance challenges

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V. MOVING FORWARD UNFINISHED BUSINESS
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Experiences of the past 5 decades

• Donors must align with and support country-driven
  approaches and systems for capacity development
• Significant efforts are required
• More creative thinking is needed
• Moving from right answers to a best fit
  implies a better understanding of country
  contexts, identifying sources of country-owned
  change, designing appropriate forms of support
  and sharing lessons learned

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Unfinished Business of Capacity Development

• Consolidating consensus on capacity development
  as an endogenous process of unleashing,
  strengthening, creating and maintaining capacity
  over time
• Identifying addressing the systemic factors
  that discourage country-owned efforts
• Donors provide support which encourages,
  strengthens and do not replace initiatives by
  leaders and managers in partner countries
• Integrating human capital formation and Technical
  Cooperation with institutional changes and
  organizational reforms
• Developing policy-relevant disaggregated
  Technical Cooperation statistics

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Annex 1 Vicious Circle Virtuous Circle
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Vicious Cycle of Empowerment
see bad results as confirming weak capacity and
commitment
DONORS
fail to claim ownership refuse responsibility
entitlement attitude
perceive standards as unrealistic, irrelevant
fill leadership gap, set boundaries and logic
suspicious establish evaluation standards,
emphasize quantity
RECIPIENTS
the get-most-out-of-the-system attitude
lack of control perceive inequities, friction
mistrust
advocate and set priorities
control implementation, staff procurement
perceives disconnect with needs and preferences
inability to question or refuse logic
conceive, write and present plan
Source UNDP, Ownership, Leadership and
Transformation, New York (2003), p.42/43
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Annex 1 Virtuous Circle
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Virtuous Cycle of Empowerment
perceive growing assertiveness capacity
development
DONORS
claim ownership assume responsibility
perceive agreed standards as relevant draw
lessons
exercise respect, restraint listen
help improve evaluation standards
RECIPIENTS
develop evaluation standards growing
partnership trust
Reform system that works for development
support national efforts, priorities, systems
processes
take some risk provide support on demand
control implementation, staff procurement
conceive, write present plan
constructive critique and long-term commitment
based on agreed conditions
Source UNDP, Ownership, Leadership and
Transformation, New York (2003), p.42/43
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Annex 1 Virtuous Circle
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UNDPs default principlescapacity development

1. A long-term process which cannot be rushed
2. Require respect for value systems and must foster
   self-esteem
3. A learning process without blueprints
4. Not power neutral and challenges existing
   mindsets and power differentials
5. Promote development and is sustainable

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UNDPs default principlescapacity development

1. Establish positive incentives
2. Integrate external inputs into national
   priorities, processes and systems
3. Build upon existing capacities rather than
   creating new ones
4. Stay engaged under difficult circumstances
5. Remain accountable to ultimate beneficiaries