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“Capacity Building”: a New Way of Doing Business for Development Assistance Organizations by Mark Schacter

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“Capacity Building”: a New Way of Doing Business for Development Assistance Organizations by Mark Schacter 1 Institute On Governance 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Policy Brief No. 6 17 – January 2000 18 Policy Brief “Capacity Building”: A New Way of Doing Business for Development Assistance Organizations by Mark Schacter 19 20 21 22 23 Institute On Governance, 122 Clarence St., Ottawa, Ontario, Canada K1N 5P6 Tel.: 1 613.562.0090 – Fax: 1 613.562.0097 – e-mail: [email protected] – Website: www.iog.ca “Capacity Building”: A New Way of Doing Business for Development Assistance Organizations 1 Policy Brief No. 6: Institute On Governance, Ottawa, Canada 1. Introduction and Northern Development, and Human “Capacity building” has moved to the center of Resources Development, refer increasingly to the agenda at agencies providing money, the importance of “building the capacity” of the equipment or technical assistance to communities or partners with which they work. communities or countries for the purpose of economic, social or institutional development. The UNDP defines capacity building as “the Initially limited to the world of international process by which individuals, organisations, development assistance, the term has now institutions and societies develop abilities assumed wider significance. (individually and collectively) to perform functions, solve problems and set and achieve This Policy Brief provides an overview of objectives.”3 The World Bank has similarly challenges faced by development assistance defined “capacity” (as opposed to the activity of agencies as they seek to adopt a capacity- capacity building) as “the combination of building perspective. It explores the operational people, institutions, and practices that permits roots of those challenges, and describes countries to achieve their development goals.”4 approaches to addressing them. 3. What’s New About “Capacity Because much of the capacity building Building”? literature1 is derived from international A respected development thinker has derided the development assistance, this paper is written term “capacity-building” as “analytically and from the perspective of international practically useless.”5 Others say it risks development agencies. But many of the becoming “a slogan rather than a meaningful concepts and lessons described here would be concept.”6 applicable to government agencies in the developed world that provide assistance to The definitions noted above do indeed suggest communities or organizations in their own that capacity-building might be so all- countries. encompassing a term as to be “useless” from an analytical and practical point of view. Helping 2. What is Meant by “Capacity societies “perform functions, solve problems and Building”? set and achieve objectives” covers virtually The term “capacity building” (or “capacity everything that a development agency might development”) came into vogue in the early wish to do. “Capacity-building” is therefore 1990s among international development indistinguishable from a common understanding agencies such as the World Bank and the United of “development”. The term appears at face Nations Development Programme (UNDP).2 value to add nothing to the approach to Bilateral development organizations such as the development problems. Canadian International Development Agency (CIDA) have also adopted the terminology. On the other hand, the fact that the term is now in wide use suggests there is more to it than Use of the term has spread beyond organizations meets the eye. Though “capacity-building” adds providing assistance to developing countries. Within the Canadian federal government, for example, Departments such as Indian Affairs 3 Capacity Development. Technical Advisory Paper 2. New York: United Nations Development Program, 1997, p. 3. 1 As well as the author’s own experience. 4 Partnership for Capacity Building in Africa. 2 For a useful overview of the recent “history” of Strategy and Program of Action. Washington: The capacity building, see “Capacity Development: World Bank. 1996. Definitions, Issues and Implications for Monitoring 5 For example, see “Promoting Good Government by and Evaluation,” by Charles Lusthaus and Marie- Supporting Institutional Development?”, by Mick Hélène Adrien. Universalia, July 1999 (Draft). Moore. IDS Bulletin, Vol. 26, No. 2 (1995), p. 93. http://www.universalia.com/capdev/paper/paper.htm 6 Lusthaus and Adrien, p. 8. “Capacity Building”: A New Way of Doing Business for Development Assistance Organizations 2 Policy Brief No. 6: Institute On Governance, Ottawa, Canada little from an analytical perspective, its rise to a procedures and targets. Internal targets at central place in the vocabulary of development organizations such as the World Bank assistance has opened the door to reexamining emphasized quantities of financial and technical how aid organizations ought to operate. Asking assistance transferred to developing countries. what it takes for an aid agency to be better at Insufficient attention was given to the “capacity-building” is tantamount to asking what sustainable development outcomes resulting it takes to be a better aid agency, period. from the provision of assistance. In particular, too little heed was paid to the question of The answer to “what’s new?” is, therefore, both whether assistance was contributing to the long- “nothing” and “everything”: term capacity of developing countries to analyze and address their own development problems.8 · “Nothing” because in principle, The objective of using development assistance development assistance has always been to reduce, ultimately, recipients’ dependence about capacity-building. upon it was rarely if ever clearly expressed and deliberately monitored. Ironically, aid agencies · “Everything” because, as summarized in the were often guilty of contributing to a “cozy next section, the recent popularization of the 9 accommodation with dependency” on the part term reflects fundamental discontent with of developing country governments. approaches that dominated thought and action in development assistance from the There were, in fairness, sound reasons for the 1950s through the mid-1990s. emphasis placed by development agencies on “moving money” to developing countries. 4. Beyond “Moving Money” The President of the World Bank – the world’s For one thing, development agencies were most influential development assistance agency motivated by the urgent need faced by the – observed recently that improvements in social world’s poorest countries to dig themselves out and economic conditions in the world’s poorest of economic and social deprivation. countries have been “too slow”7 despite huge Transferring large amounts of resources, volumes of development assistance. The quickly, was seen as an important part of the explanation for this unsatisfactory performance solution. lies with both the givers and receivers of assistance. To be sure, developing countries For another, focusing on the dollar amount of have frequently been unwilling and/or unable to assistance transferred was expedient from a make the most effective use of international aid. management perspective. It provided an But the aid agencies themselves have also been objective, easy-to-measure and readily at fault. Some have acknowledged in recent comparable performance indicator that the years that the effectiveness of their aid has been development agency could use to report on its hampered both by a relatively narrow view of overall performance, as well as that of its staff. development built around economic indicators, and by their own “corporate culture” and The recent interest in “capacity-building” management practices. represents awareness by aid agencies that past approaches – focusing on the quantity rather For too long, aid agencies focused too much than the quality of assistance and geared more to effort on satisfying their own administrative 8 A former senior World Bank official observed that 7 “A Proposal for a Comprehensive Development even though the Bank had implemented a long string Framework,” by James Wolfensohn. Washington: of highway projects over many years in an east The World Bank. 1999 African country, the country was no further ahead in (http://www.worldbank.org/cdf/cdf-text.htm). See terms of having the capacity to manage its highway also Assessing Aid. Washington: The World Bank, system. 1998. 9 Partnership for Capacity Building in Africa, p. vii. “Capacity Building”: A New Way of Doing Business for Development Assistance Organizations 3 Policy Brief No. 6: Institute On Governance, Ottawa, Canada the internal agenda of the aid-giver than the There already exists a growing and valuable recipient country’s need to build capacity to plan body of knowledge and “best practice” related to and manage its own affairs – have under- these and other capacity-building techniques. performed badly. Talk about “capacity- building” signals recognition that the process of This Policy Brief concerns the other path to development assistance needs to be turned capacity building discussed above, the one that upside down. A “donor-driven” process must covers the systems, rules and norms within aid become “client-driven.” A process obsessed agencies that have an impact on their with “inputs” must obsess, instead, about effectiveness as partners in capacity building. “results on the ground.” The assumption is that unless an aid agency adopts formal systems and informal “cultural” 5. Techniques and Systems practices that are conducive to capacity building, From an aid agency’s perspective, there are two its operational work at the level of techniques
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