-
European Centre for Development Policy ManagementCentre européen
de gestion des politiques de développement
John SaxbyPretoria, South Africa
Building capabilities for performanceThe Environment and
SustainableDevelopment Unit (ESDU) of the Organisationof Eastern
Caribbean States (OECS)
Peter Morgan
A case study prepared for the project ‘Capacity, Change and
Performance’
Discussion Paper No 57KMay 2005
Analysis
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The lack of capacity in low-income countries is one of the
mainconstraints to achieving the Millennium Development Goals.Even
practitioners confess to having only a limitedunderstanding of how
capacity actually develops. In 2002, thechair of Govnet, the
Network on Governance and CapacityDevelopment of the OECD, asked
the European Centre forDevelopment Policy Management (ECDPM) in
Maastricht, theNetherlands to undertake a study of how
organisations andsystems, mainly in developing countries, have
succeeded inbuilding their capacity and improving performance.
Theresulting study focuses on the endogenous process of
capacitydevelopment - the process of change from the perspective
ofthose undergoing the change. The study examines the factorsthat
encourage it, how it differs from one context to another,and why
efforts to develop capacity have been more successfulin some
contexts than in others.
The study consists of about 20 field cases carried out
accordingto a methodological framework with seven components,
asfollows:• Capabilities: How do the capabilities of a group,
organisation or network feed into organisational capacity?•
Endogenous change and adaptation: How do processes of
change take place within an organisation or system? •
Performance: What has the organisation or system
accomplished or is it now able to deliver? The focus here ison
assessing the effectiveness of the process of capacitydevelopment
rather than on impact, which will beapparent only in the long
term.
External context Stakeholders
Internal features andresources
External intervention
The simplified analytical framework
Co r e va r i a b l e s
Capabilities
EndogenousChange andadaptation
Performance
Study of Capacity, Change and PerformanceNotes on the
methodology
• External context: How has the external context -
thehistorical, cultural, political and institutional
environment,and the constraints and opportunities they create -
influenced the capacity and performance of theorganisation or
system?
• Stakeholders: What has been the influence of stakeholderssuch
as beneficiaries, suppliers and supporters, and theirdifferent
interests, expectations, modes of behaviour,resources,
interrelationships and intensity of involvement?
• External interventions: How have outsiders influenced
theprocess of change?
• Internal features and key resources: What are the patternsof
internal features such as formal and informal roles,structures,
resources, culture, strategies and values, andwhat influence have
they had at both the organisationaland multi-organisational
levels?
The outputs of the study will include about 20 case
studyreports, an annotated review of the literature, a set
ofassessment tools, and various thematic papers to stimulatenew
thinking and practices about capacity development. Thesynthesis
report summarising the results of the case studies willbe published
in 2005.
The results of the study, interim reports and an
elaboratedmethodology can be consulted at www.capacity.org
orwww.ecdpm.org. For further information, please contactMs Heather
Baser ([email protected]).
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Building capabilities for performance
The Environment and Sustainable Development Unit (ESDU) of the
Organisation of Eastern Caribbean States (OECS)
Peter Morgan
A case study prepared for the project 'Capacity, Change and
Performance'
May 2005
-
Capacity Study Analysis Discussion Paper No. 57K
iii
ContentsAcknowledgements ivAcronyms vExecutive summary vi
1 Introduction 1
2 The external context of the Eastern Caribbean 2
3 The influence of ESDU's stakeholders 3
4 Internal organisational features 5
5 ESDU's strategies for change 6
6 The emergence of ESDU's capabilities 11
7 External intervention 14
8 ESDU's achieved level of performance 14
9 Summary 16
Bibliography 17
Annex 1: ESDU - organisational structure in 1997 18Annex 2: ESDU
function managers 18Annex 3: ESDU task managers 19Annex 4: ESDU
management team 19Annex 5: ESDU - current organisational structure
20Annex 6: ESDU - proposed organisational structure 21
The European Centre forDevelopment Policy ManagementOnze Lieve
Vrouweplein 21NL-6211 HE Maastricht, The Netherlands Tel +31 (0)43
350 29 00Fax +31 (0)43 350 29 [email protected] www.ecdpm.org
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Discussion Paper No. 57K Capacity Study Analysis
iv
CIDA Canadian International Development Agency DAC Development
Assistance CommitteeDFID Department for International Development
(UK)ECDPM European Centre for Development Policy ManagementESDU
Environment and Sustainable Development UnitEPC Environment Policy
CommitteeGTZ Deutsche Gesellschaft für Technische Zusammenarbeit
(Germany)IT information technologyNGO non-governmental
organisationNRMU Natural Resource Management UnitOECD Organisation
for Economic Cooperation and DevelopmentOECS Organisation of
Eastern Caribbean StatesSIDS UN Global Conference on Small Island
Developing StatesSWOT strengths, weaknesses, opportunity,
threatsToR terms of referenceTA technical assistanceUNDP United
Nations Development ProgrammeUSAID United States Agency for
International DevelopmentWTO World Trade Organization
AcknowledgementsPeter Morgan, Programme Associate of ECDPM,
carried out the research at the ESDU office in St Lucia duringthe
period 17 to 21 February 2003. He is, of course, indebted to Dr
Vasantha Chase, the head of the ESDU andher colleagues in Castries
for sharing their story.
Acronyms
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Capacity Study Analysis Discussion Paper No. 57K
v
Executive summaryThis paper looks at the experience of
theEnvironment and Sustainable Development Unit(ESDU) of the
Organisation of Eastern CaribbeanStates (OECS) located in Castries,
St Lucia. The unitwas originally conceived as the regional
implement-ing arm for projects funded by the DeutscheGesellschaft
für Technische Zusammenarbeit (GTZ) atthe beginning of the 1990s,
but has since become afacilitating and bridging organisation
responding tothe needs of the Member States of the OECS.
The study tries to explain ESDU's effectiveness inenhancing its
organisational capabilities for perform-ance over the period
1996-2003 with specific refer-ence to the external context, the
stakeholders, theinternal features and resources, capacities,
endoge-nous change and adaptation, external interventionand
performance. It is based on and supported byresearch carried out at
the ESDU office in St Lucia inFebruary 2003.
ESDU is a story of organisational transformation, andwhat it
takes to get there. Changes implementedover the period under study
include the organisa-tion's mandate, management style, and
structure.The results were enhanced performance, improvedservice
output, better staff satisfaction and highercredibility amongst
stakeholders. The followingstrategies were used:
• taking ownership of ESDU as an organisation;• crafting the
role and contribution of the organisa-
tion;• aligning the direction and design of the organisa-
tion;• recruiting and developing ESDU staff;• creating a
collective, team-based approach to its
work;• finding the right leadership style;• learning how to
learn collectively; and • generating an upward spiral of
capabilities and
performance.
The case study comes to several broad conclusionsthat have wider
application across the DAC study ofcapacity, change and
performance:
• ESDU contained within itself most of the poten-tial solutions
to improve its capabilities and per-formance. ESDU staff at all
levels had a lot of tacit
knowledge and insight about what to do to makethings better. The
challenge was to create theenvironment and to allow such insight to
emergeand be given serious consideration. Embeddingthe capability
for effective internal dialogue andlearning was critical for
performance enhance-ment.
• ESDU's experience confirms what is now widelyknown about
capacity development strategies.They do not emerge in a fully
articulated condi-tion. It is not useful to think about them as
aseries of linear steps. For the most part, they arenot
programmable. Ideas and action steps appearslowly in fits and
starts and bits and pieces. ESDUsimply tried things, experimented,
argued aboutthis and that, improved here and there and aboveall,
built on improvements that appeared to work.ESDU persisted over the
seven-year period. Itacted with strategic intent over time.
• Organisations can expand too quickly and try toomany things.
For ESDU, matching its supply withdifferent kinds of demand was
critical for its sta-bility and sustainability.
• Small organisations or sub-units have their ownforms of
complexity and vulnerability and theyneed to be nurtured carefully.
Those such as ESDUthat achieve high levels of performance
alsoattract resentment and criticisms from othergroups that feel
they have less access to resourcesand opportunities. From this
perspective, capabili-ty protection and buffering may be as
importantas capability enhancement.
• Analyses of capacity often take place unconnect-ed to issues
to do with the source, the type andthe conditions of the
organisation's financing. Yetthese issues set the pattern of
incentives thatshape the decisions and actions of many of
theparticipants. In the ESDU case, the weight ofdonor financing and
the relative absence of corefunding from the Member States,
especially in thelate 1990s, put the onus on ESDU to balance
thecapacity development needs of the two groups.
• The debate about 'where to start?' may be a falseone. The
answer in the ESDU case was just aboutanywhere. They tried
something and learnedabout the results. They developed some
momen-tum. They got a sense of the overall system atwork. Then they
tried again to intervene at thosepoints of leverage where big gains
could reason-ably be expected.
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Discussion Paper No. 57K Capacity Study Analysis
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those who favour either the blood transfusionmethod of
organisational improvement (i.e. injectingsome institutional
support here or there into anorganisation in hope of improving its
general health),or the fast food approach (i.e. a little training
on theside), the insights of the ESDU case provides
anotherperspective.
The wider study of Capacity, Change andPerformance
This case study is a contribution to a wider study onCapacity,
Change and Performance coordinated by theEuropean Centre for
Development PolicyManagement (ECDPM) under the aegis of theWorking
Group on Governance and CapacityDevelopment (Govnet) of the OECD's
DevelopmentAssistance Committee (DAC). The wider study, whichis
grounded in some 18 case studies across the globe,aims to
understand what capacity is and how it isdeveloped, and to provide
insights into how externalorganisations can best support endogenous
capacitydevelopment processes. Through experiences drawnfrom the
individual case studies, the wider studyseeks a better
understanding of the meaning ofcapacity, of the complex
relationship between capaci-ty and performance improvement, and of
the process-es through which capacity is developed.
Readers need to be clear about the use of the analyti-cal
framework developed to guide the conduct ofthese case studies (see
inside front cover) and its rela-tionship to a systems view of the
ESDU experience.The framework identifies seven independent
dimen-sions: the external context, stakeholders, the
internalorganisational features and resources, endogenousmanagement
for change and adaptation, the emerg-ing capabilities, external
interventions and, finally, theachieved level of performance. Some
analysis of theexperience of the dynamics within these categories
isset out. But what matters crucially in terms of under-standing
the causes of the ESDU effectiveness - the'why' questions - are the
complex interrelationshipsamongst these categories. These issues
are highlight-ed in section 8 on performance.
A final word about definitions. The term 'capacity' isused in
this case to refer to the ability of the organi-sation or system as
a whole to perform.1 As such, it isnot equated with any subsidiary
element such as aparticular 'capability'. That term refers to a
specificability of the organisation to do something in particu-
1 IntroductionThis case study looks at the experience of
theEnvironment and Sustainable Development Unit(ESDU) of the
Organisation of Eastern CaribbeanStates (OECS) located in Castries,
the capital of StLucia. The point of this case is to highlight
ESDU'seffectiveness in enhancing its organisational capabili-ties
for performance over the period 1996-2003.
Readers need to understand three boundaries to thiscase. First,
the analysis looks at the achievements ofESDU in building its
capabilities for performance,including both the 'how' and the 'why'
aspects.Simply put, it focuses on strengths. It does not dwellon
ESDU's weaknesses except for a brief sectiontowards the end of the
paper. This emphasis onanalysing strengths is in line with the
general direc-tion of the ECDPM research. Second, the focus is
onthe development of ESDU as an organisational unit.The analysis
does not devote much attention to twoother important issues - the
organisational relation-ship of ESDU to the wider OECS, and the
capacitydevelopment strategies that ESDU itself used in sup-porting
the environmental work of the OECS MemberStates. Both these issues
are important and merit aseparate analysis. But shortage of time
and resourcesdid not permit giving them much attention for
thepurposes of this case. This case study is not a man-agement
review or an overall organisational assess-ment of ESDU. It looks
back not forward, its purpose isexplanatory, and it makes no
recommendations orproposals for future action, although we hope
theinsights will be helpful for future activities.
At first glance the ESDU experience might seem to beof only
moderate interest. It is a tiny unit within theOECS, with only 13
permanent staff and a simpleorganisational structure. It has been
adequatelyfinanced by donors. It does not have to contend withmany
of the usual organisational dysfunctions facingmany development
organisations such as perverseincentives, politicisation and
conflicting roles. But adeeper look reveals the ESDU case as a rich
micro-cosm of insights and strategies with respect to capa-bilities
for performance. In particular, the ESDU expe-rience shows in some
detail the imagination, effort,thought, discipline and staying
power - in short, thepurposeful organisational investment - that
must bemade in any serious effort to make things better. For
Capacity Study Analysis Discussion Paper No. 57K
1
Notes1 Alan Kaplan (1999) defines capacity as 'the ability of
an
organisation to function as a resilient, strategic andautonomous
entity' (The Development of Capacity, p.32).
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Discussion Paper No. 57K Capacity Study Analysis
2
lar such as to facilitate or to learn or to manage proj-ects.
Most of this case is about 'capability' as opposedto 'capacity'
development. Finally, the term 'perform-ance' is used in this case
study to mean accomplish-ment or execution or delivery. It is not
about potentialor capability.
Background
The OECS was established in 1981 under the Treaty ofBaseterre,
and currently has nine Member States:Anguilla, Antigua and Barbuda,
the British VirginIslands, Dominica, Grenada, Montserrat, St Kitts
andNevis, St Lucia and St Vincent and the Grenadines. TheNatural
Resource Management Project under theOECS was launched in 1986 with
the assistance of anexisting project of the Deutsche Gesellschaft
fürTechnische Zusammenarbeit (GTZ). In 1991, the projectwas
restructured into the Natural ResourceManagement Unit (NRMU) to act
as a partner for anumber of donor-funded projects, including those
ofUSAID (1991-1998) and later DFID (1997-2002).2 TheNRMU officially
became part of the OECS in 1991. In1996, the Fisheries Unit of the
OECS was folded intothe NRMU making it a more multidisciplinary
teamcovering a broader range of sustainable developmentissues. In
that year, the unit also led the preparationof the OECS Regional
Position and Action Plan forSustainable Development, which was
presented tothe UN Global Conference on Small Island
DevelopingStates (SIDS). An environment capacity building proj-ect
sponsored by the Canadian InternationalDevelopment Agency (CIDA)
began in 1999, followedby World Bank support for solid waste
managementin 2001.
After the signing of the St George's Declaration inApril 2001
(see box 2), the unit changed its name fromNRMU to ESDU to better
reflect the nature of itsmandate.3
2 The external contextof the Eastern Caribbean
ESDU as a unit within the OECS functioned as anopen
organisational system interacting with its exter-nal context both
in St Lucia and across the EasternCaribbean region. This report
therefore starts with abrief analysis of the key contextual factors
thatshaped ESDU's functioning over the period 1996-2003.
ESDU works exclusively with the small island states ofthe
Eastern Caribbean, which are now struggling toadjust to and find
new ways of meeting the demandsof the globalising world economy.4
In the words ofone analyst, '... small states are at a crossroads.
Thepost-colonial model - based on trade preferences, offi-cial aid
and relationships with former powers - is fad-ing and a new model
is being born'.5 Most of the eco-nomic challenges faced by such
states are wellknown, including high income volatility, a
dependenceon a few income-producing sectors, a rapidly chang-ing
set of trade rules under the World TradeOrganization (WTO),
declining levels of developmentassistance and a low capacity to
diversify risk.6
Small island states in the Caribbean also face a partic-ular set
of issues in managing their environment.
Notes2 The NRMU incorporated the OECS fisheries portfolio in
1996
and became the Environment and SustainableDevelopment Unit
(ESDU) the after the signing of the StGeorge's Declaration in April
2001. For simplicity, this casestudy uses the present name ESDU
throughout the text.
3 The ESDU mandate as set by the Environment PolicyCommittee
(Ministers) includes facilitating capacitybuilding and
institutional strengthening at the nationallevel, catalysing and
stimulating Member States to improvethe planning and management of
the environment and tobe a reliable source of information and
advice on naturalresource management and sustainable
development.
4 A small state is generally recognised to be a country with
apopulation of 1.5 million or less. There are 49 such states,
ofwhich 42 are classified as developing counties, 32 areislands,
and most are located far from their major markets.Of the 25
countries ranked by the CommonwealthSecretariat as the most
vulnerable, 25 are small states. Ofthe 25 least vulnerable, only
two are small states. Forfurther information on the issue of small
states, see OECS,Human Development Report 2002.
5 Commonwealth Secretariat/World Bank Joint Task Force onSmall
States (1999) Making Small States Less Vulnerable:Supporting
Development During Globalisation, draft, p.16
6 The Commonwealth Secretariat/World Bank report (p.2)estimates
that small states have an income volatility 25%greater than those
of other states.
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Capacity Study Analysis Discussion Paper No. 57K
3
Some of the most pressing are the following:• An increased
vulnerability to natural disasters. The
Eastern Caribbean region lies across one of theworld's most
active volcanic zones. Changes inglobal climate may be accelerating
the frequencyof severe hurricanes.7
• The prevalence of small scattered fragile ecosys-tems within
these countries heightens their vul-nerability. Small size leads to
tight system inter-connections among environmental events.
Hillsideerosion and soil runoff in the morning, for exam-ple, can
affect inshore fishing in the afternoon.Most human populations are
also concentrated insmall areas, giving rise to problems with
solidwaste management, traffic congestion and infra-structure
development. Competition can beintense for limited land
resources.
• The fates of the environment and the economyare tightly
connected. Tourism, one of the region'sonly internationally
competitive industries,depends critically for its survival on the
naturalresource base, even as it contributes to its destruc-tion.8
Biodiversity, coastal and marine ecosystems,and water and forestry
resources are all underthreat.
Small states face special institutional constraints.9They must
carry out a range of national tasks - main-taining border and
coastal defences, complying withinternational treaties,
macroeconomic policy making,etc. - that can strain the capabilities
of small govern-ments. Meagre resources in terms of human skills
andfunds have to be spread over a wide range of govern-ment
functions. It is difficult to justify a major invest-ment in
training for small state organisations, partic-ularly when
nationals with marketable skills tend toemigrate. Most small states
have a lower ability todeliver effective services and higher per
capita coststhan large states. They must spend a
disproportion-ately high level of their revenues on
infrastructureinvestments such as roads and bridges. Many
govern-ment organisations find it difficult to break out of
tra-ditional patterns of administration given the limitedinternal
mobility and promotion possibilities.Incentives for performance are
weak, particularly atthe senior levels of the public sector. Small
statesmust take more on trust and are vulnerable toexploitation by
organised external groups eager to
profit from their sovereignty. They also find it hard todevelop
the capabilities to mobilise, facilitate and col-laborate amongst
themselves and other actors.
None of the above factors automatically mean thatsmall island
states are destined to end up as haplessvictims in a globalised
world. Reports by both theWorld Bank and the UNDP point to genuine
opportu-nities for them in the emerging global economy.10What does
seem to be clear is the need for suchstates to develop their
capabilities to take maximumadvantage of their human and natural
assets in orderto make their way. Collective action both within
andamongst countries is a key way to generate
betterperformance.
3 The influence of ESDU's stakeholders
All organisations have stakeholders. Most can benefitfrom having
demanding external ones - clients, bene-ficiaries, partners,
customers, supporters, funders, citi-zens - who will both exert
pressure for performanceand provide the support and resources
necessary forsustainability. This general notion held true for
ESDU.What was different in this case were the particularinterests
and configuration of its stakeholders andtheir interrelationships.
As we shall see, its pattern ofstakeholder involvement was one of
the underlyingreasons for ESDU's effectiveness.
The first and most important of its stakeholders werethe Member
States of the OECS. As noted above, thenine countries were faced
with the challenge ofspreading their meagre resources across a
range ofnational public functions. Not surprisingly, none ofthem
opted for a separate ministry or independentagency focusing solely
on the environment. All haveenvironmental units housed in sector
ministries thatdeal with other related issues such as health,
tourismor agriculture (see table 1 on page 4).
ESDU staff saw the Member States - their govern-ments and people
- as their main stakeholders, bene-ficiaries and partners.11 All
the countries were of suchsmall size that ESDU staff could develop
personalrelationships with a broad range of citizens and
Notes7 A good part of Montserrat, including the capital, was
buried
under volcanic ash in 1997. Over 65% of the population hadto
leave the island. St Vincent has been hit by fivehurricanes in the
last four years.
8 Tourism contributes up to 25% of GDP in some islands. Formost
it is now the major earner of foreign exchange.
9 See Baker (Ed.) (1992) Public Administration in Small
andIsland States.
10 About 28% of world tourism spending goes to
countriesspecialising in 'sun, sea and sand'.
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Discussion Paper No. 57K Capacity Study Analysis
4
government officials. This personal involvement moti-vated ESDU
staff and gave them a direct and tangibleconnection between their
efforts and outcomes. Inaddition, OECS ministers responsible for
environmen-tal issues in the Member States also sat on
theEnvironment Policy Committee (EPC), which for ESDUfunctioned
much like a board of directors.12 This governance structure
reinforced the line of accounta-bility between ESDU's staff and its
partners and bene-ficiaries. It provided a system of checks and
balancesthat shielded ESDU's work to some degree fromundue
politicisation. Most important, it providedESDU with clear answers
to two questions thatbedevil most public sector organisations in
any coun-try - exactly who is the organisation working for, andwhy?
Given its tight focus on the needs of theMember States, ESDU was in
a position to align itscapabilities and performance to meet those
needs. Itwas also not forced to engage in non-productive sym-bolic
behaviour to mollify marginal stakeholders.
Its international funding agencies - mainly GTZ,USAID, DFID, the
World Bank, the CaribbeanDevelopment Bank, the Organization of
AmericanStates, and CIDA - made up a second key group of out-side
stakeholders. Section 7 looks in more detail at thecontributions
these organisations made to ESDU. Butit may be useful to highlight
one key point at thisstage of the analysis. For a variety of
reasons, these
funding agencies established direct working andfinancial
relationships with ESDU and, for most pur-poses, they treated it as
an individual entity with itsown mandate, work programme and set of
account-abilities. The beneficial effect of this relationship
onESDU as an organisation was that it allowed it to con-trol its
own operating space. ESDU had the freedomto set its own direction
and experiment with differentapproaches in terms of improving its
capabilities andperformance.
The Eastern Caribbean region has a history of civilsociety
involvement in environmental managementand sustainable
development.13 Most NGOs havebeen involved in information
management, advocacyand beautification, but few have participated
directlyin the actual management of natural resources giventhe
dominant role of public sector organisations. Lackof capacity was
one reason offered for this lack ofinvolvement. ESDU's interactions
with NGOsremained modest over the period.
Finally, ESDU was a sub-unit within the OECS.14 Thatlatter
organisation managed over the period to sortout the 'whole and the
parts' relationship that is atest for organisations all over the
world. How doorganisations balance the need for overall
corporatecohesion and sub-unit flexibility? Are these trade-offsor
can they be pursued simultaneously? What func-
Table 1. Location of the environmental management function in
the OECS Member States
Member State Ministry or agency with a mandate for environmental
management
Grenada Health and EnvironmentSt Lucia Planning, Development,
Housing and the EnvironmentSt Vincent and the Grenadines Health and
EnvironmentSt Kitts and Nevis Health and EnvironmentDominica
Agriculture and EnvironmentAntigua and Barbuda Tourism, Culture and
the EnvironmentMontserrat Agriculture, Lands and EnvironmentBritish
Virgin Islands Natural Resources and LabourAnguilla Chief
Minister's Office
Notes11 Without exception, every ESDU staff member
interviewed
for this study talked at some length about theresponsibilities
of ESDU to meet the needs of the MemberStates.
12 The EPC met once per year. There is also a TechnicalAdvisory
Committee (TAC) which provides advisory servicesto the ESDU.
13 See OECS Natural Resources Management Unit (2000)Options for
the Participation of Civil Society in EnvironmentalManagement and
Sustainable Development, Technical Paper3.
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Capacity Study Analysis Discussion Paper No. 57K
5
tions must be centralised and which must be delegat-ed for
sub-unit responsiveness and speed of action?How can organisations
such as the OECS as a wholebenefit from the dynamism of one of its
sub-unitssuch as ESDU? What is the responsibility of a sub-unitsuch
as ESDU in terms of supporting the overall needsof the
organisation? For the most part, the OECSSecretariat and ESDU opted
for an organisationaldesign that allowed ESDU a good deal of
operatingflexibility which, in turn, accounted for much ofESDU's
effectiveness.
The emerging outlines of ESDU's enabling environ-ment for
building its capabilities and performancecan now be seen. It had
direct and clear relationshipswith its key stakeholders,
beneficiaries and partners,many of whom at the governmental level
were in aposition to supervise its behaviour. This pattern
ofinstitutional incentives pushed ESDU towards improv-ing its
capabilities and performance to meet the spe-cific needs of the
Member States. In addition, its'loose-tight' relationship with the
OECS, and the will-ingness of its donors to give it direct funding,
provid-ed it with the operating autonomy and flexibility tomake
many of its own decisions with respect toorganisational structure,
recruitment of personneland operating style.
None of these factors, by themselves, were guaran-tees of
improved capabilities and performance. Theenabling environment was
not determinant. Part ofESDU's success came from its ability to
maintain itsoperating space by managing and balancing thebehaviour
of its stakeholders - earning legitimacy andtrust from the Member
States, attracting outside sup-port, restraining inappropriate
donor initiatives andusing outside support to keep its
independence.Maintaining that enabling environment was a
crucialpart of the capability and performance puzzle. In theESDU
case, it encouraged self-ownership and a capa-bility for action.
These, in turn, provided much of theorganisational dynamism that
was characteristic ofESDU over the period 1996-2003.
4 Internal organisationalfeatures
The internal organisational features of ESDU can beroughly
tracked over the seven years from 1996 to2003. Annex 1 sets out the
organisational structureand the staff numbers in 1997. In that
year, the organi-sation disbursed about EC$ 3.2 million including
bothoperational and programme funds. Staff morale andmotivation
were typical of most small organisations. Astaff survey in mid-1996
showed general satisfactionbut also a number of the usual concerns
about per-sonal recognition and rewards, cleavages betweengroups,
uncertainty about ESDU's direction, unsatis-factory training
opportunities and a poor informationtechnology (IT) system.15
Relations with the OECSSecretariat were perceived as needing some
improve-ment. Ties to the Member States appear to have
beensatisfactory but largely mediated through donor proj-ects and
other activities. ESDU's relationship in 1996with its donors was
mainly reactive. Up to that point,ESDU's role had been largely that
of a project-basedholding operation implementing activities
largelyinspired, supplied and funded by donors. ESDU hadgiven
little thought to its capabilities or performance.It focused on its
internal procedures and functions in asomewhat unsystematic way.
Staff took a convention-al problem-solving approach to their
work.
None of these characteristics was unusual. For themost part,
they represented the profile of most smallorganisations or units
with an average level of per-formance. The question for ESDU was
the following:what should and could be done to get itself up to
ahigher level of capability and performance? Theremainder of this
report sets out ESDU's approachesto achieving that objective.
The new head of ESDU, appointed in January 1996,began to think
through different leadership styles andtried to understand the most
effective ways toimprove ESDU's overall capacity. What followed was
apersistent effort to improve capacities and perform-ance. Annex 5
shows ESDU's current organisationalstructure. In 2001 there were 15
staff members, includ-ing the head of programme, five programme
leaders,seven support staff and two consultants and hasremained
roughly the same ever since. Of the 13 per-manent positions, 11 are
now core funded by theMember States. Total annual disbursements are
nowNotes
14 The head of the ESDU reports to the director of
functionalcooperation in the OECS Secretariat, who in turn reports
tothe Director General.
15 Systems Caribbean Ltd (1996) Interim Report #1,Management
Audit of NRMU.
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Discussion Paper No. 57K Capacity Study Analysis
6
about EC$ 2.5 million (US$ 750,000). Of this figure,38% goes to
cover administrative costs, 65% of whichis funded through the
Member States. The total pro-jected disbursements for the period
2002-2006 areEC$ 15.8 million (US$ 6 million). By all accounts, it
hasbecome a highly effective organisation. What strate-gies were
put in place to reach that stage?
5 ESDU's strategies for change
ESDU's experiments with improving its capabilitiesand
performance went on for most of the seven-yearperiod. The following
strategies appear to have madethe most difference:• taking
ownership of ESDU as an organisation;• crafting the role and
contribution of the organisa-
tion;• aligning the direction and design of the organisa-
tion;• recruiting and developing ESDU staff;• creating a
collective, team-based approach to its
work;• finding the right leadership style;• learning how to
learn collectively; and • generating an upward spiral of
capabilities and
performance
Taking ownership of ESDU as an organisation
Part of the current conventional wisdom about aideffectiveness
has to do with ownership, i.e. the needfor country governments and
participants to 'takeownership' of development projects and
programmessupported by international funding agencies. Much ofthis
wisdom is useful, but part of it masks the wish offunders to equate
ownership with country compli-ance. From this perspective,
compliance could allowinternational funding agencies to continue to
respondto their own set of incentives and keep generating theusual
stream of initiatives and programmes. Thenotion of country
compliance or 'buy-in' in someinstances became a convenient way of
reconcilingcompeting ownerships.16 This issue was more acute inthe
Eastern Caribbean where the disparities inresources and expertise
between the funding agenciesand small island states could be quite
wide.
ESDU began to devise an answer to this issue of own-ership in
mid-1996. It would take ownership of itsown organisation. It would
come up with its own pro-grammes and priorities. Staff would
develop an own-ership mentality. The aid relationship could then
bereversed, with funding agencies being encouraged torespond to
ESDU's initiatives and needs. ESDU alsobegan to think more
creatively about its own way oforganising. Most organisations in
the public sectorthink constantly about their programmes and
budg-ets. When they look at organisational issues, the stafffocus
on structure, the administrative processes andthe constraints they
face in delivering their pro-grammes. They think about staff
numbers, workloadsand the availability of equipment. Staff who
spend agreat deal of time thinking systematically about
theirprogramme strategies somehow fail to do the samething when it
comes to their own organisation. Inmany cases, issues to do with
control, motivation,inequities and weaknesses, leadership - the
dreaded'soft' issues - become undiscussable.
One of the keys to ESDU's success over the seven-yearperiod was
its growing capability to think creativelyand persistently about
itself as a human system. 1996marked the departure point from which
ESDU staffbegan to experiment with different approaches
toorganising.• In 1996, ESDU improved upon a set of recommen-
dations coming out of a management audit spon-sored by DFID.17
For example, it opted for a muchflatter structure as opposed to the
sharp hierarchyrecommended by the consultants. That sameprocess
generated the mission statement thatremains at the heart of ESDU's
work in 2003. Inthe same year, ESDU issued its first five-year
oper-ational plan 1996-2001 and its first administrativemanual.
• In April 2001, the St George's Declaration onEnvironmental
Sustainability officially designatedESDU as the regional
implementing agency (seebox 2). ESDU also went through another
manage-ment review in November of that year.
• In late 2001, ESDU requested CIDA to cease supply-ing it with
full-time Canadian technical assistance(TA) personnel through an
executing agency con-tract. ESDU and CIDA agreed on a transitional
planto phase out the Canadian TA, and ESDU becameresponsible for
implementing the CIDA-fundedprogramme in April 2002.
• In 2002, the OECS issued an EnvironmentalManagement Strategy
drafted by ESDU, which
Notes16 This issue was summed up by a delegate in the
UNDP-CIDA-
JICA workshop in the Philippines who asked the questionabout who
owns ownership.
17 It is instructive to note that the ESDU did not accept
therecommendations in this 1996 review to install a
clearorganisational hierarchy, but opted instead for a muchflatter
structure typical of an adhocracy.
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Capacity Study Analysis Discussion Paper No. 57K
7
reflected wide stakeholder participation through-out the region.
ESDU also issued its second five-year operational plan in May
2002.
The organisational thinking of ESDU shifted incre-mentally
during the period 1996-2003. It began withthe effort to bring
together its technical activities anddonor-supported projects into
a cohesive programme.ESDU then started to upgrade its internal
structureand systems. It issued an organisation manual in 1996to
support staff work in that area. Its view of itself asan
organisation then widened to include the 'soft' orpeople issues
that staff seemed to care about. It thenbroadened again in 1999 and
saw itself as an organi-sational whole or a system whose elements -
the mis-sion, the structure, the people, the needs of MemberStates,
the supply of resources, etc. - were intercon-nected. By the end of
the decade, the staff had begunto give more explicit attention to
the issues of per-formance and results. By the time the second
five-year operational plan was issued in 2001, more specif-ic
thinking was being paid to building specific capa-bilities. In
2003, ESDU had begun to integrate twoviews of strategic thinking
about its work - the 'posi-tioning' view, which looked at its role
and potentialcontribution in the Eastern Caribbean, and also
the'resource-based' view, which paid more attention toits
comparative advantage based on its internalresources and
capabilities.
Crafting the role and contribution of the organisation
It is, of course, one thing to take possession of
anorganisation, but it is quite another to decide what todo with
it. In 1996 ESDU faced a number of possiblestrategic choices about
its niche and direction. Shouldit be a policy research organisation
along the lines ofsome other sub-units in the OECS? Should it
imple-ment projects directly on behalf of Member States?Should it
focus on providing facilitation and support?Or should it be an
all-purpose actor and try to do a bitof everything given the huge
range of needs in theMember States? How should such critical
choices bedecided, and by whom? And who would pay?
It is useful to return here to the discussion on stake-holders
in section 3. ESDU was in the fortunate posi-tion of being able to
concentrate on the needs of onegroup of stakeholders - the Member
States. The staffalso brought to the table their own set of values
that
gave prime importance to building the capabilities ofthese
states, and groups within them, to managetheir own affairs. Thus
early in 1996, a consensusdeveloped around the idea of ESDU as a
facilitating orbridging organisation that would respond to theneeds
of the Member States and support theirefforts.18 The mission
statement crafted at that timeread as follows:
'To be a dynamic facilitator of effective utilisation
andmanagement of natural resources for sustainabledevelopment in
the OECS sub-region through collabo-ration with and among Member
States'.
Direct implementation by ESDU would only be under-taken in cases
where the Member State in questioncould not carry out tasks such as
the procurement ofservices and equipment. This set of key decisions
to dowith ESDU's role and contribution was reflected in the1996
mission statement, and became the basicassumption around which the
organisation wasdesigned. Put another way, there was now an
acceptedanswer to the question - 'capabilities for what?'
Thechallenge for ESDU would be to try and ensure thatthe
donor-funded projects it agreed to implementwould also meet the
needs of the Member States.
Aligning the direction and design of the organisation
Once the basic directions had been set, ESDU couldthen begin to
align its structures and systems to sup-port its mission. In
practice, it could devise a coherentorganisational strategy and
focus the work of its staff.We can thus see the organisation doing
the followingover the period.
In 1996 ESDU shifted to an organisational programmestructure to
break down the internal empires createdby donor-funded projects. It
opted for a much flatterstructure to increase inter-unit
communication andcollaboration. ESDU in practice became an almost
hori-zontal organisation with an extremely limited
verticalhierarchy and strong informal linkages working
hori-zontally to take advantage of its small size.
Job designs and terms of reference were deliberatelymade to
overlap in order to increase interpersonal andinter-functional
coordination and communication. Allstaff members were encouraged to
understand thefull range of ESDU's activities. Multi-tasking
was
Notes18 These types of organisations come with their own set
of
challenges. See Brown (1992) Development BridgingOrganizations
and Strategic Management for Social Change,IDR Reports.
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Discussion Paper No. 57K Capacity Study Analysis
8
encouraged. They had to be able to fill in for othersduring
absences or emergencies, as well as to repre-sent the organisation
at public functions. ESDU madeprogress in becoming what one staff
member calledan 'open library' that enabled staff to know muchmore
about what happening in ESDU at both individ-ual and organisational
levels. Staff tried to stop hoard-ing information and got rid of
private files held attheir desks.
The technical content of job design appears to havebeen
carefully calculated. Staff needed sufficient tech-nical skills to
add value to discussions with officialsfrom the Member States. But
technical job contentcould not reach a point where it created
communica-tion barriers within the organisation or interfered
withthe willingness of staff to be comfortable with tasksthat were
multidisciplinary and multi-functional. Staffskills were to be a
careful blend of both those of thegeneralist (e.g. facilitation)
and the technician (e.g.coastal zone management) in order to match
the jobdesign. More specific technical skills would be hiredwithin
the region or outside as necessary through con-sultancies.19
ESDU developed the capacity to create ad hoc teamsor 'quality
circles' around projects or problems or someconcentration of staff
activity. In many cases, theseteams were virtual, given the long
absences of teammembers as they travelled in the region. Internal
com-munication systems were also improved. These includ-ed some
formal channels such as an ESDU newsletter,The Insider, which was
designed to keep the widelydispersed staff up to date on the range
of programmeactivities, and the OECS newsletter, Participaction,
tocommunicate internally.
Recruiting and developing ESDU staff
In a small organisation such as ESDU, effectivenessdepends
critically on the skills and motivation of itsstaff. ESDU relied on
a strategy that allowed for 'mak-ing' rather than 'buying' the core
skills it needed. Mostof the staff who joined the organisation over
the peri-od 1991-1996 were from St Lucia, and some hadworked
together before in the Fisheries Department ofthat country. All the
technical staff were graduates inthe social or physical sciences or
environmental man-agement, and came with a personal commitment
tothe development of the Eastern Caribbean. A gender
balance was maintained to avoid the usual dysfunc-tions caused
by too many women or men in oneoffice.20
ESDU did not face a problem with retaining staff, andthe core of
the group remained in place over the peri-od 1996-2003. Salaries
and financial incentives wereadequate to retain them. The small
private sector inthe Eastern Caribbean was not in a position to
offerrewarding secure work of similar interest. ESDU'sgrowing
effectiveness and legitimacy, the dynamismof the work and the
opportunities for making a devel-opment contribution combined to
retain the staff andprotect ESDU's core skills. Access to
meaningful workrather than promotion possibilities was key.
It is important to note the degree of overlap betweenthe formal
and informal structures within ESDU.21Most organisations,
especially those larger thanESDU, tend to separate into formal
(e.g. jobs descrip-tions, reporting relationships, lines of
authority) andinformal structures (e.g. patterns of group
behaviourand personal relationships). In many countries,
theinformal becomes dominant. The two can also con-flict with the
informal aspects, acting to interferewith the goals of the formal
organisation. Staff, forexample, can have more incentives to
maximise theirown personal interests regardless of the wider
nega-tive impact on the whole organisation. The ESDU casewas the
reverse in that the staff saw little, if any, dif-ference between
their own interests and those ofESDU as a whole.
Staff training was a minor part of ESDU's approach todeveloping
its capabilities. Most years, it spent lessthan 1% of its annual
budget on training. What mat-tered more was the development of a
culture of skillacquisition and the encouragement of staff to
buildindividual and organisational capabilities throughtheir
regular work. Those formal training opportuni-ties that were
provided appear to have had more todo with motivation than with
skill development.
Notes19 In 1991 ESDU issued 71 contracts for outside
consultants.20 Maintaining a gender balance in the Eastern
Caribbean
frequently means hiring more men.21 For details of ESDU's formal
structures, see Annexes 1-6.
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Capacity Study Analysis Discussion Paper No. 57K
9
Box 1: ESDU and its administrative support staff
In 1996, the ESDU organisational structure had aformal (and
informal) staff hierarchy, with the headof the unit, a second layer
of technical programmestaff, and a third layer of administrative
supportstaff. The technical staff had been implicitlyassigned an
image of authority and respect deriv-ing from their work
experience, educational back-ground, professional expertise and
public recogni-tion. The behaviour patterns of and
interactionsamong staff at the second and third levels resem-bled
those familiar to organisations all over theworld.
ESDU staff decided to reduce the level of segmen-tation, for a
variety of reasons. These included per-formance pressures that
dictated greater internalcollaboration, and the need to create a
sense ofrespect and recognition for all staff members. Theybegan by
talking about the issue openly and com-ing up with informal rules
for personal behaviour.Support staff received more access to
training,22and they began to take on roles beyond those nor-mally
assigned to support staff, including repre-senting ESDU at outside
meetings and interactingwith the public. All staff members,
regardless oftheir position, were expected to make the connec-tion
in their work programmes between their con-tributions and the
overall performance of theorganisation. In due course, the title
'administrativesupport services' was changed to 'corporate
servic-es' and was included as one of the core capabilitiesof the
organisation. Perhaps most important, thestaff persisted in dealing
with the issue over thenext four or five years in an effort to
change theculture of the organisation.
Finding the right leadership style
Such an emerging organisation clearly could not beled and
managed on the basis of a 'command andcontrol ' style or a 'hub and
spokes' structure that aretypically found in small organisations.
Throughoutthe period 1996-2003, the head of ESDU worked
tounderstand the needs of the emerging organisationand adjust her
approach to leadership and manage-ment accordingly.23
Creating a collective, team-based approach to itswork
ESDU decided to take advantage of its small size andtry to
create a cohesive, collective approach to man-aging. Indeed, few
organisations focused more ongetting their internal dynamics
straight than didESDU. Part of the group cohesion was
achievedthrough a common allegiance to a set of values hav-ing to
do with sustainable development and thepotential of the Eastern
Caribbean. Many of theseESDU values reflected those brought to the
organisa-tion by the staff themselves. What ESDU added wasthe
reinforcement and validation of these valuescombined with the
opportunity for staff to put theminto practice in their daily work.
ESDU helped provideits staff with a continuing sense of
professionalmeaning and purpose. In most cases, they agreed onboth
programme ends and organisational means,most of which were
symbolised by the mission state-ment that staff internalised.
Sustained efforts were made over the period toreduce the
disparities and segmentation within theorganisation (see box 1).
The message to (and from)staff was that everyone was valued and
that everycontribution was critical to ESDU's overall perform-ance.
Staff needed to understand the ways in whichtheir contribution and
their personal behaviouraffected the work of others in the
organisation. ESDUstaff developed a collective capacity for
managinginternal conflict. Mechanisms such as the quality cir-cles,
late Friday afternoon get-togethers and groupfield trips reinforced
a sense of collegiality.
Staff spent a good deal of time in 1998 designing theoffice
addition funded by DFID. They planned staff-friendly cubicles for
both technical and administrativestaff. They asked for common areas
such as an eatingarea, meeting rooms and an outside deck to
encour-age staff interaction. They designed a building with alot of
access to natural light to reinforce the culture ofopenness and
natural life.
Notes22 For example, the registry clerk was sent to Canada
for
training.23 Her emerging leadership style bore an uncanny
resemblance to that described in Bradford and Cohen
(1984)Managing for Excellence: The Guide to Developing
HighPerformance in Contemporary Organizations.
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Discussion Paper No. 57K Capacity Study Analysis
10
ESDU's increased capacity seems to have resultedfrom slow,
incremental, persistent learning.
• They were encouraged to learn about aspects ofthe organisation
not part of their specific workassignments. Learning was seen as
part of theirreal work and not a supplement when timeallowed. They
were even encouraged to read aboutESDU activities outside their job
responsibilities.
• Learning was focused as much on the future as onthe past, and
on capitalising on opportunities asmuch as on solving problems. A
good part wasconnected to the resolution of operational issuesat
the field level.
• Learning extended beyond the normal safe techni-cal issues.
Staff took on the challenge of what hasbeen called social learning,
i.e. how better to inter-act with colleagues in an effort to
improve every-one's performance.25 They learned, for example,how to
engage in productive dialogue insideESDU, and how to get around the
defensive rou-tines that limit the effectiveness of so
manyorganisations.
Generating an upward spiral of capabilities andperformance
Organisations get locked into systemic patternsfrom which they
find it hard to escape. Enron is thelatest example of the vicious
cycle in which negativefactors combine and accelerate a decline
that even-tually collapses the organisation. Others find
them-selves oscillating from one structure to another andthen back
again (e.g. centralisation to decentralisa-tion to recentralisation
and then back to redecen-tralisation). But a few manage to generate
anupward spiral that builds on their strengths.Capabilities and
achievements are enhanced andconfidence rises.26 The organisation
then attractsmore resources that lead, in turn, to more
capabili-ties and achievements.
This last pattern appears to have happened in theESDU case.
Since 1996, it moved steadily to enhanceits capabilities and
performance. Stakeholders, espe-
• She spent more time thinking about the architec-ture of the
organisation and about ways toimprove its performance as a system.
This pointedto changes in the mission, the relationship
withinternational funding agencies, personal behav-iour within ESDU
and other issues. Staff acceptedher efforts to make things better,
and these valuesof integrity and a performance orientation
madetheir way into ESDU's culture.
• Responsibility and authority were pushed down tothe next level
in an effort to prevent the disem-powerment of ESDU staff. The
leadership and stafflearned to manage on the basis of greater
delega-tion and trust. The head of the unit tried to man-age less
at the micro level.
• ESDU moved away from the implicit notion of theorganisation as
a personal possession of the lead-ership. Staff understood the need
to identify withthe organisation as a whole and to share
responsi-bility, along with the leadership, for its
overallmanagement. Staff began to accept their individ-ual
responsibility for the performance and fate ofthe unit. They
developed what has been called asense of organisational
citizenship. Decision mak-ing became more collective.
• The transition to this style of leadership did notprove easy.
In a number of ways, this approachputs more rather than less
pressure on the headsof organisational units. They still must
getinvolved in micro issues while at the same timepaying more
attention to macro-system mainte-nance. As the volume of work
expands, leadersfind themselves straining to keep up with
activi-ties at a variety of levels.
Learning how to learn collectively
At the heart of enhancing capabilities and perform-ance lies
some form of learning and unlearning. Staff,both individually and
collectively, must learn to doexisting activities better or new
ones well, and to giveup practices that have long been effective.
ESDU staffsensed the need to learn constantly and collectively.24 •
They spent time brainstorming about ways to
solve problems and ways to improve. The learningstyle was
primarily inclusive, collective, non-hierar-chical and social. In
practice, ESDU slowly becamea small learning community with the
capability toconvert individual tacit knowledge into
collectivelearning. Little seems to have come about by dra-matic
breakthroughs in understanding. Much of
Notes24 All the ESDU staff interviewed for this case study
used
phrases such as ... 'we learned how to do x' or 'we
nowunderstand about y' or 'we figured out how to do z...' or'we've
come along way since then'.
25 For an analysis of social learning, see Brown (1997)
SocialCapital, Mutual Influence and Social Learning in
IntersectoralProblem-solving in Africa and Asia, IDR Reports, vol.
13(2).
26 Stocks of social capital such as trust, norms and
networkstend to be self-reinforcing and cumulative.
Successfulcollaboration in one endeavour builds connections and
trustwhich become social assets to facilitate future
collaborationin other unrelated tasks.
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Capacity Study Analysis Discussion Paper No. 57K
11
cially the Member States, rewarded these trends byinvesting more
resources and more trust in theorganisation. Staff responded by
identifying morewith ESDU and committing to its goals and way
ofworking. At some point in this process of buildingan upward
spiral, the organisation tapped into whathas been called its
positive core, which is a mosaicof its strengths, resources, assets
and capabilities.27The psyche of the organisation became stronger
andmore expectant of good performance. ESDU becameits own enabling
environment.
6 The emergence of ESDU's capabilities
Most discussions about capacity development insmall
organisations such as ESDU revolve aroundissues of general
management. What should bethe mission and objectives of the
organisation?What would be the best structure? How best toimprove
the accounting system? Do staff membershave the resources they need
to do their work?How can the overall organisation perform
better?Many of these issues in the ESDU situation havebeen
discussed in section 5.
But assuming these discussions have taken place,the issue of
capabilities remains unaddressed.Having the right organisational
structure or eventhe right people does not guarantee a
capability.What else has to be done if more specific capabili-ties
are to be enhanced or built? What actuallymakes up a capability?
How does a capabilityemerge? In practice, most organisations,
includingsmall ones such as ESDU, possess a complex rangeof
capabilities at different levels of aggregation,scope,
effectiveness and intensity. They can havecapabilities to manage
projects, to conduct inter-nal dialogue, to have fun, to raise
funds, to negoti-ate with donors, to make decisions, to
arrangeworkshops, to issue contracts, to brainstorm, todesign a
partnership, to maintain their computers,to motivate staff, to
publicise their achievements,to learn, to adapt their structure,
and so forth.Some are core and others are marginal. Some ofthese
capabilities are reinforcing, while others con-
flict at certain points. Some are aggregated
andorganisation-wide. Some are narrow and reside inonly a few
people. The challenge for any organisa-tion is to turn this
interconnected tangle of capa-bilities into some sort of organised
portfolio thatcan be managed for sustained performance.
This section tracks ESDU's efforts to address theseissues. In
1996, ESDU was essentially a shell organi-sation housing a series
of donor-supported proj-ects. Six years later, its second five-year
operationalplan put forward a matrix of four key competen-cies and
five functional areas (see below). Behindthis matrix was an ESDU
effort to address some ofthe questions that lay at the heart of the
issues ofcapabilities and performance:• which capabilities were
core and why? • what made up these capabilities? • how did these
capabilities relate to ESDU pro-
grammes?• what other capabilities had to be put in place
to support the core capabilities? • what had to be put in place
to connect up and
manage these capabilities? • what were the risks involved in
having this
combination of capabilities and how couldthose risks be
managed?
Which capabilities were core and why?
The first step for ESDU was to be clear about thecore
capabilities that best supported its missionand mandate. This
implied a choice that focusedon delivering value to the Member
States, as dis-cussed in section 3. After internal and external
con-sultations, ESDU settled on four key capabilities, allof which
were already present to some degree inthe ESDU portfolio. Readers
should note that thesecapabilities were aggregated and broad in
scope,and extended across the current range of ESDU'stechnical
programmes. They were not limited to aparticular product or
project. They were intendedto deliver value outside the
organisation over themedium and long term. They also centred on
activ-ities where ESDU could make some sort of uniquecontribution
compared to other organisationsworking in the Eastern Caribbean.
Finally, theyreflected a consensus among ESDU's key stake-holders
and beneficiaries about where ESDUshould focus its attention. As
such, these capabili-ties had some wider legitimacy with ESDU's
stake-
Notes27 See Whitney and Trosten-Bloom (2003) The Power of
Appreciate Inquiry: A Practical Guide to Positive Change.
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Discussion Paper No. 57K Capacity Study Analysis
12
holders that added to their effectiveness. All ofthese factors
went into the decision about ESDU'sfour core capabilities:•
facilitating • advocating • mobilising • managing.
What made up these capabilities?
The make-up of these capabilities can be looked atfrom two
perspectives. The capability of advocacy, forexample, was focused
on the following priorities.• advocacy designed to ensure that
sustainable
development programmes are adequately fundedby the Member
States;
• advocacy for the development, adoption andimplementation of
environmental managementstrategies in Member States; and
• advocacy of the interests of the Eastern Caribbeanregion in
the development and implementation ofinternational policies and
programmes.
These core capabilities were also made up of otherconstituent
skills.28 Individual ESDU staff members,groups within ESDU, and
ESDU as an organisationneeded to combine technical capabilities
(e.g. anunderstanding of coastal zone management), organi-sational
capabilities (e.g. networking, project man-agement, financial
management, contracting) andthose to do with the human and social
(e.g. being
able to manage conflict) in order to make their corecapabilities
effective. In this way, ESDU's core capabili-ties were combinations
of other constituent materialsfused together for improved
performance.In the short time available to carry out this
casestudy, it was not possible to analyse the constituentskills
that made up various core capabilities withinESDU. This task also
raises two other issues: first, therelationship of such core
capabilities to the rest of theorganisation, and second, the need
for a systematicway of making this kind of assessment across a
rangeof cases.
How did these capabilities relate to the ESDUprogrammes?
Table 2 is taken from ESDU's second five-year opera-tional plan
dated May 2002. It shows the matrix rela-tionship between
capabilities and the five pro-gramme areas identified in the OECS
EnvironmentalManagement Strategy that followed the signing ofthe St
George's Declaration in 2001 (the top row indi-cates the different
capabilities required to implementeach programme area).
Notes28 Much of what ESDU actually did parallels the thinking
on
core competencies that can be seen in the private
sectorliterature. See, for example, Hamel (1994) 'The concept
ofcore competence', ch.1 in Hamel and Heene (Eds.)Competence-Based
Competition.
Table 2. Matrix of capabilities and programmes
Role Facilitating Advocating Mobilising ManagingFunction
Sustainable livelihoods
Environmental planning and management
Education and awarenessSmall projects facility
Corporate services
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What other capabilities had to be put in place tosupport the
core capabilities?
The ESDU experience suggests three other types ofcapabilities
are essential to support the core capabili-ties. First, ESDU had to
have a range of internal capa-bilities that complemented and
supported those corecapabilities that were delivering external
value. Mostorganisations find it hard to get this balance
right.Many young NGOs, for example, concentrate on pro-gramming and
interacting with beneficiaries. Theirfocus is external. But they
find it difficult to build theinternal systems e.g. personnel and
financial manage-ment - that are needed to keep the organisation
sta-ble. Conversely, large public sector organisationsdevelop those
internal systems that help to ensuretheir perpetuation, but over
time they lose the capa-bility to deliver serious value outside the
organisa-tion. ESDU appears to have managed to balance thesetwo
types of capability. Donors supported ESDU'sefforts to improve its
contracting and financial sys-tems, IT systems and personnel
management. Muchof this progress was also made in cooperation
withstaff of the OECS Secretariat.29 ESDU also worked toimprove its
staff performance appraisal systems withthe help of the University
of the West Indies.
Second, ESDU needed a set of 'soft' capabilities to bal-ance its
'hard' ones. Much of the conventional discus-sion about capacity
development, especially amongthe donor community, has traditionally
focused onways to improve the formal or 'hard' internal
capabili-ties of organisations such as strategic planning,
policyanalysis, organisational structure and systems, finan-cial
management and human resource develop-ment.30 Most donor-supported
technical assistance(TA) has historically worked on these aspects.
TheESDU experience, however, leads to the view thatsuch a focus is
necessary but not sufficient if overallcapacity is the goal.
Efforts at capacity developmentneed to be expanded to include these
'soft' aspectsthat in many cases, only the country partner can
sup-ply. It was ESDU's ability to deal with the 'soft' aspectsof
its management that made the donor-supportedinterventions
effective. In the ESDU case, these 'soft'internal capabilities
included, but were not limited tothe following:• the capability to
learn;• the capability of staff to discuss issues and reach a
consensus;• the capability to manage change; and• the capability
to manage outside stakeholders.
Third, an organisation must have a core capability -usually not
included on any list - to connect all ofthese external and
internal, hard and soft capabilities,and integrate them into a
performing whole. Nocapability works on its own. It must be
connected andsupported to be effective. In the ESDU case, all
thecapabilities were, in the end, collective efforts. Theywere
energised and made effective by the systemicconnections in the
organisation amongst the differ-ent components - the organisational
design, the rela-tionships with stakeholders, the informal
relation-ships, the access to resources, the high levels of
moti-vation and commitment, the leadership, and so forth.It was
this capability of strategic integration thatappeared to make the
real difference.
Box 2: ESDU and institutional development:the St George's
Declaration on the Principles ofEnvironmental Sustainability
The idea of an environmental charter for theEastern Caribbean
came onto the ESDU agenda asearly as 1997. Such an initiative was
discussed atthe ministerial meeting of the OECS EnvironmentPolicy
Committee (EPC) and agreement wasreached to begin work. In 2000,
ESDU arrangedand facilitated a meeting in Antigua, which
wasattended by representatives of the main countrystakeholders
including governments, NGOs and theprivate sector. Over three days,
the group came upwith a draft charter that was then submitted
forfurther consultations in all the countries. A reviseddraft was
then submitted to the EPC for review andthen to the cabinets in all
the Member States forfinal ratification. The document, eventually
called adeclaration, was signed in St Lucia on 10 April 2001.
The St George's Declaration is an example of theinterplay
between institutional and organisationalissues. It set the rules of
the game for MemberStates in the OECS. It gave a stronger mandate
andgreater legitimacy to the work of environmentministries and to
ESDU itself, and helped both intheir negotiations with finance
ministries and theinternational funding community. It also
allowedthe OECS to participate more credibly in interna-tional
discussions on the environment and sustain-able development such as
the follow-up to theSmall Island Developing States Plan of
Action.
Notes29 The OECS had overall responsibility for IT systems.30
The 1996 management audit suggested the following for
institutional strengthening - design and implementation ofan
integrated planning process, an informationmanagement strategy, an
information technology solution,a human resources management
system, a financialmanagement system and a cost recovery strategy
(p.13).
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7 External interventionThe overall contribution of the
international fundingagencies to the process of improving ESDU's
capabili-ties and performance appears to have been positive,albeit
modest, for two key reasons. The main reasonwas the determination
of ESDU to keep control of itsown agenda and to restrain
international fundersfrom overwhelming it with a steam of new
initiatives,demands, conditions and fashionable ideas. The sec-ond
was the willingness of international funders totrust ESDU and to
listen seriously to its proposals andcounter-suggestions. In
practice, the aid relationshipbetween ESDU and its funding partners
graduallyevolved into being the standard of behaviour, trustand
support sought by most members of the aidcommunity.
As documented in this case, ESDU's strategies andactions were
decisive in building its own capabilitiesand performance. External
intervenors were not in aposition to lead or at times even
understand theinternal process of change that went on over
theseven-year period. But an appropriate division oflabour emerged.
ESDU shaped and managed theprocess of change but called on outside
assistance formore specialised tasks.
Most of ESDU's funders made useful interventions atvarious
times, some of which proved to be of lastingvalue. These can be
summed up as follows:• A number of donors provided useful advice
to
ESDU as it tried to think through its organisationalstrategy.
GTZ encouraged ESDU to take a morestrategic approach to its
management. DFID con-sultants first raised the idea of a
team-basedstructure and helped craft the mission statement.CIDA
consultants provided ideas on the choice ofESDU's core
competencies.
• Donors provided ESDU with adequate financingover the period
1996-2003, most of which wentdirectly to ESDU. This access to
resources and theprotective buffering helped ESDU to maintain
theoperational space that was critical to building
itseffectiveness.
• Donor requirements for proper financial manage-ment and
procedures pushed ESDU to develop its'hard' systems (e.g. work
planning, reporting, con-tracting and financial management) faster
thanwould otherwise have been the case. They also
provided ESDU with support for infrastructuredevelopment such as
the ESDU building and theOECS website.
• CIDA agreed to phase out its full-time TA earlierthan
originally planned and helped ESDU with atransitional plan to give
it full responsibility formanaging the CIDA contribution.
8 ESDU's achieved level of performance
Caution should be exercised in attributing perform-ance gains
directly to ESDU's growing capabilities, fora number of reasons.
First, ESDU functioned as a facil-itator and supporter to the
Member States of theOECS. Accelerated project and programme
perform-ance were probably as much the result of MemberState
efforts as they were of those of ESDU. Second,ESDU had only a
rudimentary monitoring system thatcould make a systematic link
between its efforts andoutcomes for the Member States.31 Most of
the evi-dence that does exist on the link between capabilitiesand
performance remains anecdotal. Third, many ofits performance 'gaps'
as perceived by some MemberStates had to do not so much with ESDU's
organisa-tional capabilities but with the issue of the access
tocore financing from Member States and from interna-tional
funders.
Given these qualifications, what can be said aboutESDU's level
of performance? Judging from a reviewin November 2001, which
conducted SWOT work-shops in a number of OECS Member States
focusingon ESDU's performance, the following assessmentseems
reasonable:• ESDU had a good track record in the planning and
delivery of large, donor-funded projects.• ESDU had a
well-developed capability to access
international funding that the Member Statescould not match.
• It managed to put in place a collective regionalapproach to
environmental policy making.
• ESDU staff had a reputation for being accessible,hard-working
and willing to assist Member States.
• ESDU had a broad knowledge of regional andglobal issues that
could be useful to MemberStates.
• ESDU had a proven ability to facilitate consulta-
Notes31 In many cases, performance monitoring remains the
responsibility of Member States.
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15
tions in support of policy making by the MemberStates.
• Member States also nominated ESDU to be theirimplementing
agency with respect to the imple-mentation of the St George's
Declaration.
Part of the reason for this level of performance lies inissues
that have already been discussed in this casestudy. But two other
dynamics need highlighting.First, ESDU was designed both as a
'supply-driven' anda 'demand-responsive' organisation. On the
supplyside, it developed its capabilities over the
seven-yearperiod. Its staff members were oriented towards
per-formance, to outcomes and to making a contribution.On the
demand side, it tried to be as responsive aspossible to meeting the
needs of Member States. Thisinteracting dynamic - both pushing the
supply andbeing pulled by demand - energised the organisationand
accounted, at least in part, for the high level ofperformance.
Second, ESDU went some distancetowards integrating its direction,
its programme com-ponents, its assets and resources, and its
executioncapabilities into one coherent whole, as describedabove.32
In practice, it generated performance fromits integrated
functioning as an organisational sys-tem.
The sustainability of ESDU's capabilities and its levelof
performance were a perennial subject of discus-sion, both within
and outside the organisation. Theissue usually boiled down to the
following: ESDU waslargely funded by the international funding
commu-nity, a situation that understandably directed
ESDU'sattention towards the delivery of donor-funded proj-ects at
the expense of the more routine environmen-tal planning and
management needs of the MemberStates. As international funding
threatened todecline, the prospects for the erosion of ESDU's
capa-bilities remained a matter of concern. The obviousways out of
this dilemma - either core funding fromthe Member States or some
other way for ESDU toraise revenues - remain under
consideration.33
The emphasis in this case has been on highlightingESDU's
strengths and achievements. But ESDU wasnot a miraculous
organisation free of weaknesses, flatsides or failures. ESDU staff
members were consciousof gaps in their capabilities and
performance. At astaff retreat in January 2003 they focused on
thetopic 'improving performance' and came up with thefollowing:•
ESDU's small size and limited resources prevented
adequate follow-up to many of its donor-fundedinterventions.
Member States do not or could notfund this activity.
• Its capability to integrate the social, economic
andenvironmental aspects of sustainable develop-ment remained
weak.
• Communication barriers within the unit remainedan issue
despite efforts over the years to eliminatethem.34
• More resources needed to be invested in skillsdevelopment for
the staff to keep them up todate.35 ESDU's capabilities might be
eroding underthe pressure of change.
• Declining financial resources were threatening toundermine
ESDU's overall capability to providetimely and efficient
service.36
• The growing virtuality of the organisation, duemainly to
extensive travel demands, had started toerode ESDU's collective
spirit.37
• ESDU had encountered constraints in its ability tostimulate
change within the public bureaucraciesof the Member States.
Notes32 For an analysis of the same phenomenon in the
private
sector, see Fuchs et al. (2000) 'Strategic integration:competing
in the age of capabilities', CaliforniaManagement Review, vol.
42(3).
33 All 13 permanent staff positions within ESDU will be
corefunded by the Member States by 2005.
34 Some internal mechanisms such as the staff newsletter,
TheInsider, and the use of quality circles are being revived.
35 ESDU is now undertaking a skills inventory of its
presentstaff to identify gaps and priority needs.
36 Staff are now formulating a updated resource
mobilisationplan.
37 This is a common phenomenon in many organisations. SeePrusak
and Cohen (2001) 'How to invest in social capital',Harvard Business
Review, 79(6), pp.86-93.
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Discussion Paper No. 57K Capacity Study Analysis
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9 Summary The lessons of the ESDU case need to be
assessedcautiously. All the dangers of the current infatuationwith
best practices are present. ESDU was, and is, avery particular
organisational unit with special advan-tages that do not apply to
most organisations. It wasa small unit with few of the internal
organisationalpathologies that show up in much larger
organisa-tions. It was able to develop a clear mandate and setof
beneficiaries. It had access to adequate resources. Itdid not face
internal battles over the choice of itsemerging capabilities.
Collective approaches wereobviously much easier in such a small
organisation.Simply put, ESDU was in a good situation and
pro-ceeded to make it better.
The case, however, does give rise to several broad con-clusions
that may have wider application across thewider study.• ESDU did
borrow ideas from other organisations
and the broader management literature. As men-tioned earlier, it
followed some - but by no meansall - of the consulting advice it
received. But themain source of inspiration and insights came
fromESDU staff themselves, none of whom were insti-tutional
specialists. The point here is that, in com-mon with many
organisations, ESDU containedwithin itself most of the potential
solutions toimprove its capabilities and performance.
Thesesolutions, even those that appeared to be strategicin nature,
were sourced from all over the organisa-tion, from leaders to
administrative assistants.ESDU staff at all levels simply had a lot
of tacitknowledge and insight about what to do to makethings
better. The challenge was to create theenvironment and to allow
such insights to emergeand be given serious consideration.
Embeddingthe capability for effective internal dialogue andlearning
was critical for capability and perform-ance enhancement.
• ESDU's experience confirms what is now widelyknown about
capacity development strategies.They do not emerge in a fully
articulated condi-tion. It is not useful to think about them as
aseries of linear steps. In practice, they are emer-gent. For the
most part, they are not programma-ble. Ideas and action steps
appear slowly in fitsand starts and bits and pieces. ESDU simply
triedthings, experimented, argued about this and that,
improved here and there and above all, built onimprovements that
appeared to work. And ESDUpersisted over the seven-year period. It
acted withstrategic intent over time.
• Organisations can expand too quickly and try toomany things.
Ambition can quickly exceed thereach of capabilities. ESDU, for
example, was reluc-tant to take on too much implementation onbehalf
of Member States for fear of weakening itsexisting capabilities for
facilitation, mobilisationand advocacy. Matching supply with
differentkinds of demand was critical for its stability
andsustainability.
• Small organisations or sub-units have their ownform of
complexity and vulnerability and theyneed to be nurtured carefully.
Those that achievehigh levels of performance, such as ESDU, mayalso
attract resentment and criticisms from othergroups that feel they
have less access to resourcesand opportunities. From this
perspective, capabili-ty protection and buffering may be as
importantas capability enhancement.
• More needs to be known about developing orenhancing particular
capabilities. What does ittake to build a capability for effective
learning in asmall organisation in a low-income country? Is
thiseasier or harder to do compared to somethingsuch as financial
management? Is there asequence or a natural evolution in the
develop-ment of such capabilities? What does it mean tomanage an
organisation as a portfolio of capabili-ties?
• The case raises the issue of the financing of capac-ity
development. Too often, capacity analyses takeplace unconnected to
issues to do with the source,the type and the conditions of the
organisation'sfinancing. Yet these issues set the pattern
ofincentives that shape the decisions and actions ofmany of the
participants. In the ESDU case, theweight of donor financing and
the relativeabsence of core funding from the Member
States,especially in the late 1990s, put the onus on ESDUto balance
the capacity development needs of thetwo groups.
• The debate about 'where to start?' may be a falseone. The
answer in the ESDU case was just aboutanywhere. They tried
something and learnedabout the results. They developed some
momen-tum. They got a sense of the overall system atwork. Then they
tried again to intervene at thosepoints of leverage where big gains
could reason-ably be expected.
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Bibliography Baker, R. (Ed.), 1992. Public Administration in
Small and Island States, West Hartford, CT: Kumarian Press.
Bradford, D.L. and Cohen, A.R., 1984. Managing for Excellence:
The Guide to Developing High Performance inContemporary
Organizations (New York: Wiley).
Brown, D., 1992. Development Bridging Organizations and
Strategic Management for Social Change, IDR Reports.
Brown, D., 1997. Social Capital, Mutual Influence and Social
Learning in Intersectoral Problem-solving in Africaand Asia, IDR
Reports, vol. 13(2).
Campbell, J., 2001. Third Output to Purpose Review Report of the
DFID Project, Support to the Natural ResourcesManagement Unit and
the Eastern Caribbean Coastal Resources Management Initiative,
report prepared by theInnovation Centre, University of Exeter,
UK.
Commonwealth Secretariat/World Bank Joint Task Force on Small
States, 1999. Making Small States LessVulnerable: Supporting
Development during Globalisation, draft.
Fuchs, P., Mifflin, K., Miller, D. and Whitney, J., 2000.
'Strategic integration: competing in the age of
capabilities',California Management Review, vol. 42(3).
Glazier, G. 2001. Review of the OECS Natural Resources
Management Unit, report prepared for theEnvironmental Capacity
Development Project.
Hamel, G., 1994. 'The concept of core competence', ch.1 in G.
Hamel and A. Heene (Eds.) Competence-BasedCompetition (Chichester:
Wiley).
National Resources Management Unit, 2002. An Agenda for Action:
Environmental Portfolio, Second Five YearOperational Plan.
Kaplan, A., 1999. The Development of Capacity (New York: UN
Non-Governmental Liaison Service).
OECS Natural Resources Management Unit, 2000. Options for the
Participation of Civil Society in EnvironmentalManagement and
Sustainable Development, Technical Paper 3.
OECS Secretariat, 2002. OECS Human Development Report 2002.
OECS Secretariat, 2002. OECS Environmental Management
Strategy.
Prusak, L. and Cohen, D., 2001. 'How to invest in social
capital', Harvard Business Review, 79(6), pp.86-93.
Systems Caribbean Ltd, 1996. Management Audit of NRMU.
Systems Caribbean Ltd, 1996. Interim Reports 1 and 2, Management
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Whitney, D. and Trosten-Bloom, A., 2003. The Power of
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Francisco: Berrett-Koehler).
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ProgrammeLeader
FisheriesManagement/Development
AdminAssistant Accountant
InformationOfficer
PublicAwareness
Officer
Network / Database
Administrator
Coordinator TechnicalServices
Manager Admin
and Finance
Coordinator Information,
Databases Manage-
ment
Head of Unit
Annex 1: ESDU - organisatinal structure in 1997
Annex 2: ESDU function managers1. CORE FUNCTION:
To oversee, direct and coordinate the planning and management of
the five functions that make up the portfolio of the OECS-ESDU
towards fulfilment of its vision and mission, zoning in on the
broader mandate of sustainable development.
2. TERMS OF REFERENCE2.1 To participate in the ESDU's strategic
planning process and take the lead in the various function
areas in the development of work plan and budgets consistent
with the ESDU's overall strategy and major objectives;
2.2 To assist in the ESDU's corporate marketing activities;
attend and represent the ESDU at relevantnational, regional and
international events and in related fora;
2.3 To participate, as required, in the ESDU's negotiations and
related activities for resource mobilisation;2.4 To design and
ensure maintenance of the ESDU's human resource development system
and provide
guidance in the day-to-day management of relevant policies and
procedures;2.5 To ensure timely preparation of relevant proposals,
agreements and contracts for approval by the
OECS-ESDU and donor agencies. As appropriate, review and adjust
these submissions;2.6 To consistently monitor, analyse and report
on progress in respect of each function within the Unit,
monitor monthly, analyse trends quarterly, and prepare
consolidated quarterly and annual reports;2.7 To ensure allocation
of appropriate resources (technical, financial) to facilitate
capacity building and
institutional strengthening in the OECS Member States;2.8 To
assist the HOU in developing and facilitating appropriate
strategies and programmes for
improving the ESDU's financial sustainability;2.9 To maintain
control systems for the efficient results management of assigned
projects, resources
and reporting personnel; and2.10To contribute towards the
building of a positive team spirit within the Unit.
DocumentsClerk
Accounts Clerk
Delivery/ Mainten-
ance Officer
Typist/ Reception-
istRegistry
Clerk
Secretary/ Training Support
Assistant
ProgrammeLeader
EnvironmentPlanning
ProgrammeLeader
WatershedManagement
TechnicalOfficer
TechnicalOfficer
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Annex 3: ESDU task managers 3. CORE FUNCTION:
To plan, develop, manage and facilitate delivery of specific
tasks that make up the Corporate Services function of the
OECS-ESDU, ensuring proper management and monitoring of those
tasks, towards the fulfilment of the OECS-ESDU's corporate
plans.
4. TERMS OF REFERENCE4.1 to participate in the operational
planning of the corporate services function of the ESDU, and
pre
pare compatible work plans for day-to-day delivery of office
administration, personnel services and financial management;
4.2 to plan, develop, manage and ensure the timely production of
accurate financial accounting and related project management
records;
4.3 to organise, supervise and facilitate delivery of the ESDU's
administrative and personnel services;4.4 to maintain the ESDU'S
documentation and records management systems in a systematic,
up-to-
date order, to facilitate easy identification of relevant
information;4.5 to coordinate and maintain, in a systematic and
easily traceable manner, arrangements for travel
(staff, resource persons, etc); workshops and the awarding of
contracts, grant agreements and travelgrants;
4.6 to support/facilitate the development of a