The document describes a diagnostic model for capacity building in regulatory organizations. It discusses four main components: 1) Strategic planning and management to mediate political and administrative interfaces, avoid political capture, and build consensus. 2) Work processes driven by strategic intentions to enable effective interrelationships and learning. 3) Performance management to develop staff skills and address complexity through systems appropriate to the type of regulation. 4) Interconnection of management components to ensure congruency of efforts and cohesiveness in capacity building. The major concern of the model is achieving coherence across these components.

1. THE DIAGNOSTIC MODEL FOR CAPACITY BUILDING

2. DESCRIPTION OF THE MAIN COMPONENTS OF THE MODEL AND THEIR
CONNECTION WITH THE MANAGEMENT OF REGULATION

3. The importance of strategic planning / management to regulation is demonstrated by the
existence of a political / administrative interface that has to be carefully mediated by regulators
in the interest of a number of stakeholders (Arête, 2002). Avoidance of “political capture”
(Knight-John, 2002) is a prime consideration as regulators struggle to rationalize the translation
of regulatory intention, as mandated by legislation and/or “political direction”, into policies and
programmes of action. Regulators require skills in this process that can resolve conflict arising
from different opinions on the philosophy, ends, means and timing of regulation (Carino, 2002).
Mintzberg (1994) sees managers in these circumstances only being able to move forward by
taking on board insights from key stakeholders which broaden the consideration of issues and
invoke a learning process. Justification of inclusion of this component in the Model also rests on
the proposition by Bryson (1995) that sees strategic planning as a means of translating the
political decision making model into consensual agreements on the design of policies and
programmes of action.
A systemic understanding of work processes, driven by strategic intention, gives rise in the
words of Deming (1994: 61) to the “real organization chart” that in the case of regulation
enables staff members to interrelate more effectively in the interest of achieving quality
outcomes. Such interrelationships are also able to stimulate a learning climate that furthers
progress on specific elements of regulation and builds knowledge vital for system functioning
and improvement amongst those involved. Achieving this type of learning synergy involving
knowledge and associated actions is at the heart of consistency within regulation and
contributes to an enhanced awareness of transparency (Minogue, 2004).
Central to the achievement of quality outcomes for regulation are the skills and attitudes that
staff in an agency can bring to bear on the complexity of processes. Without sufficient attention
to the human dimension regulators cannot expect to bring their organizations to a peak of
effectiveness. Hence the need for a sound system of performance management, whose form is
influenced by the strategic planning / management and work system design features adopted
as appropriate for the type of regulation in question. Choice on the form of a performance

4. management system adopted also rests to some extent with a regulator, dependent on her/his
preferred managerial style, the type of internal culture promoted, the extent of team working
to be encouraged and the degree to which staff members are to be empowered as individuals
and in teams in securing effective processes of regulation.
Approaches are likely to reflect good governance measures already applicable to the public
sector in a specific context (Minogue, 2003) and compass these types of question:
• How far is appraisal of performance related to what people are expected to achieve rather
than on the behavioral attributes they possess?
• Should there be recognition that the development of staff is very much linked to the task
demands they face and the nature of the systems they operate in, rather than purely to their
own specified career choices?
• How far is there to be a consideration of the fact that no one individual is likely to be
responsible for the quality of what is being achieved, and that performance has to be
undertaken and reviewed as a joint responsibility amongst the relevant staff?
• Is it possible that any formal written appraisal and subsequent discussion is always based on
regular and informal reviews of the progress in a prior period?
Organizations will evolve the form of the management components according to their own
needs and circumstances but their formation is always likely to be an interrelated process to
ensure a congruency of efforts in respect of regulatory intention, actions, and outcomes and
their evaluation. The major concern of the Diagnostic Model is the potential to achieve a
cohesiveness of the management components within capacity building efforts.

5. The Link between Needed Capacity Building and the Measures
Adopted to Achieve Them

8. THE INTERCONNECTION OF THE CAPACITY BUILDING ENHANCERS