Knowledge and Capacity Development


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Knowledge and Capacity Development

  1. 1. IFAD Workshop Balancing Hard and Soft Investments<br />Knowledge and Capacity Development<br />G. Alaerts<br />The World Bank<br />April 18, 2011<br />
  2. 2. Getting a grip on the issues<br />“Hard investments” – works, equipment, surveys, technical designs, etc.<br />“Soft investments” – any activity in the social and institutional spheres that increases (i) quality of the project prioritization, (ii) net development impact, and (iii) financial sustainability of investments and programs.<br />Policy and strategic frameworks<br />Dialogues<br />Institutional strengthening and reforms<br />Knowledge and capacity development KCD (encompasses all the above …)<br />For financier: Project design, program management, M&E, learning …<br />
  3. 3. World Bank and international approaches<br />WB: has strong interest in <br />quality of portfolio, <br />development impact,<br />sustainability  capable institutions  reforms<br />Much work on Impact assessment, M&E<br />Much work on Results in CPS and program design<br />Comparatively little discussion on institutions and KCD<br />ADB, UNDP, EU: More work on KCD and how to assess capacity and its improvement<br />
  4. 4. World Bank considerations<br />Better investment prioritization, plus design and ownership, have in past decade led to better results<br />Since mid-90s financing is no longer key impediment to sector development:<br />Much observable need, but constrained internal demand<br />Financiers (World Bank, ADB, IDB, …) often cannot achieve lending targets<br />EU cannot disburse cohesion funds to member countries; absorption is around 10-20%<br />WSS PPP failed partially, partly because it was expected that private partner can bring and help absorb funds<br /> Major leap in efficiency of institutions and absorption capacity required within next decade<br />
  5. 5. World Bank and international approaches<br />WB: two-pronged approach<br />Organizations: <br />70-80s: 5% of loans used for TA and training<br />> 80s: more KCD <br />Institutions: reforms through conditions, budget support and TA<br />Challenge: tension between (i) short-term “results”-driven and budget-driven /accountable approaches, and (ii) longer-term adaptive approaches building C<br />Hard to assess – the latter purported to be more robust; but the former arguably developing economy and providing the “marbles” to learn the “game”<br />But clear that KCD without hardware doesn’t work well<br />
  6. 6. World Bank experience<br />WB review of Africa capacity development(2006): <br />TA and training ineffective to build sustainable public sector capacity.<br />While some countries do well, average SSA govt capacity has stagnated …<br />
  7. 7. World Bank experience: Africa Region<br /> Is capacity included in the development objective? <br /> <br />World Bank Institute desk study, 2008 (unpublished).<br />
  8. 8. World Bank experience: Africa Region<br />Type of capacity development inputs in WB projects <br /> <br />World Bank Institute desk study, 2008 (unpublished)<br />But – no specific data about reforms, institutional strengthening, knowledge development, etc.<br />
  9. 9. Principles of KCD<br />Two basic approaches:<br />Capacity can be developed through inputs, leading in turn to better results positivist approach, assuming causal relations between input and output<br />Capacity is emerging from complex interactions that are partly endogenous and partly exogenous  stresses non-plannable nature, prioritizes capacity not results, stresses need for adaptive management<br />“What works” can be either, or a combination … depending on the situation, start position (path dependency) and objectives<br />
  10. 10. Principles of KCD<br />Capacity is the “ability of people, organisations, and society as whole to manage their affairs successfully” <br />OECD (2005) <br />“Capacity is the ability of individuals, groups, institutions and organizations to identify and solve development problems over time” <br />Morgan (1993), UNDP (1993)<br /> external partners cannot “do” CD of others. Partners can support and direct CD processes, but they cannot manage the actual CD of others  key criterion for success is that CD must be “owned” by those who develop their capacity<br />
  11. 11. KCD Principles <br />“Capacity is the capability of an institution or society to<br />identify and <br />understand its development issues, <br />act to address these, and <br />learn from experience and accumulate knowledge for the future.”<br />Alaerts (2009)<br />This definition is more<br />Operational <br />Linked with knowledge<br />Allows to specify verifiable impacts<br />“Extra” capacity for learning<br />
  12. 12. Principles of KCD<br />Adaptive capacity: <br />considers changes in external factors in a proactive manner to develop a systemic process for improving management policies and practices, with a central objective of increasing the adaptive capacity of the management regime in general, and the involved actors in particular. (Morgan, Pahl-Wostl)<br />“Adaptive management is learning to manage by managing to learn.”<br />
  13. 13. Knowledge and capacity – levels diagram (Alaerts and Kaspersma 2010) <br />
  14. 14. Knowledge and capacity – measuring capacity<br />
  15. 15. KCD rationale<br />Very few efforts to quantify ERR<br />Indonesia Irrigation Improvement with Water User Associations (WUAs) empowerment (2003):<br />Conventional rehabilitation ERR of 10 - 18 %<br />Capacity development only  ERR of 20 – 30 %<br />Rehab plus enhanced knowledge and capacity of the WUAs  ERR of 30 – 40 %<br />Education: Long-run effect of 1 additional year of education in OECD area == 3 – 6% increment in GDP/cap.<br />
  16. 16. World Bank tools for results: (i) prioritization<br />Country Partnership Strategy (with MoF, stakeholders)<br />Country Poverty Reduction Strategy (with other donors)<br />Sectoral policy and strategy studies (ESW and TA)<br />Operational Risk Assessment Framework (ORAF)<br />Quality-at-Entry and other peer-reviews<br />Implementation Completion Report (ICR)<br />Independent Evaluation Group (IEG) reviews and reports<br />Etc.<br />
  17. 17. World Bank tools for results: (ii) Monitoring<br />IDA Results Monitoring: with key indicators:<br />Growth and poverty reduction<br />Public financial management and investment climate<br />Infrastructure and access to services<br />Human development (education, health, equity, …)<br />Quality and effectiveness of IDA program activities <br />Regular sectoral policy and operational policy reviews<br />Experience with Inspection Panel<br />Other <br />
  18. 18. World Bank tools for results: (iii) investment tool kit<br />IDA Poverty Reduction Support Credit<br />Global Food Response Crisis Program<br />Climate Change Mitigation and Adaptation programs <br />HPIC and Fragile and Conflict-Affected States<br />Global Floods and Disaster Response and Reduction <br />GEF-supported projects for environmental sustainability<br />Program for Results (P4R) (replaces SWAps, OBA etc)<br />Development Policy Loans (budget support + reforms)<br />Sectoral programs: Irrigation, agriculture, municipal development, WSS, flood management, health, etc.<br />Etcetera<br />
  19. 19. World Bank tools for results: (iv) in short …<br />Two approaches are advocated:<br />Focus on short-term tangible results, within set time frames and budgets, and with clear accountability / measurability … <br />Focus on longer-term capacity development recognizing endogenous capacity growth, with lower measurability …<br />
  20. 20. World Bank tools for results: (iv) in short …<br />WB takes pragmatic route 1 enhanced with:<br />Priority for sustainable investments, meeting a demand and with demonstrated institutional readiness<br />Design flexibility to allow learning-as-we-go (use of Additional Financing, APL and phased projects)<br />Lower ambitions on Development Objectives<br />Mix in institutional strengthening where opportunity seems to exist<br />Use investment to improve economic outlook first<br />Use investment to engage and prepare institutions<br />No a priori inclusion or exclusion of KCD<br />
  21. 21. Diagnosis: multiple paths to a capable state(World Bank Institute 2007)<br />
  22. 22. From diagnosis to selection of intervention <br />reforms<br />
  23. 23. Other approaches in developing capacity<br />OECD, UNDP, EuropeAid – <br />stress the complexity nature of capacity and the adaptive management approach<br />Manuals with laborious capacity assessment<br />More geared for macro tasks<br />UNDP (2007): Capacity Assessment Methodology: <br />starting from Capacity assessment, <br />then Desired future capacities, <br />Capacity gap assessment, <br />Work plan<br />Mostly for sector-wide or governance areas<br />
  24. 24. Other approaches in developing capacity (ADB)<br />ADB – Practical Guide to Capacity Development in Sector Context:<br />Focuses on institutional change / reforms, and change management<br />10 sections with tools for diagnosis, dialogue and planning<br />Though the diagnosis and dialogue give good guidance, risk exists of over-analysis<br />
  25. 25. Other approaches in developing capacity (ADB)<br />
  26. 26. Balancing Soft and Hard investments: A way forward<br />Main constraint to development is lack of institutional capacity  need major leap in institutional performance<br />Fundamental decision: Positivist concept of development vs. constructivist concept: <br />Planned mgmt vs. adaptive mgmt.<br /> What works best when? <br />Flexible opportunistic approaches based on risk analysis and realistic objectives are probably best<br />Short-term projects to support long-term program<br />Projects prioritizing both capacity development and results are undermining effectiveness on both counts<br />An opportunistic blend of H and S is probably best in short and long run<br /> Need stronger guidance framework & lessons<br />
  27. 27. “Soft investments”: A way forward in KCD<br />We make advances on the diagnostics --<br /> need to understand better how KCD instruments work best, e.g.<br />How to maintain engagement and facilitate change processes<br />How to develop effective networks, formal and social ones<br />How to make partnerships effective<br />Tacit knowledge is more important than explicit knowledge  yet we know little about how tacit K works; and especially in developing countries education is geared to explicit K<br />How to build on local K and endogenous capacity and preferences<br />