Table of Contents

• Introduction
• Capacity and Capacity Building - Conceptual Questions Arising
• Capacity for what? - Programme Objectives and Scope
• Capacity Development - A Process Approach
• Capacity and Evaluation

Capacity Building is a risky, murky, messy business with unpredictable and unquantifiable outcomes, uncertain methodologies, contested objectives, many unintended consequences, little credit to its champions and long time lags.

When thinking about capacity issues, the narrow clarity of the 1980s has slowly given way to a more sophisticated but less certain perspective in the 1990s.

(Source: Peter Morgan; Some Observations and Lessons on Capacity Building, 1999)

This quotation provides a most apposite point of departure for this workshop. The slipperiness of capacity building, conceptually, but also operationally, is why having this workshop is important. The rationale behind this event is that our understanding of capacity issues, and in turn our abilities to address capacity challenges, can be helped by drawing lessons of experience from practice. In particular, what can a diverse set of case studies, reflecting quite different capacity development experiences, tell us about;

• our understanding of what capacity and capacity building is;
• how we go about building, developing, mobilising capacities;
• how we use evaluation in the context of capacity development programmes and processes;

Capacity and Capacity Building - Conceptual Questions Arising

What do the case studies tell us about the conceptual frameworks we use when designing or engaging in capacity development activities ? Are these shared, is there a basis for common understanding ?

The case studies reveal a range of notions about capacity and capacity development. This is evidenced both by the different types of conceptual frameworks presented, and definitions provided, and by the nature of the programmes reported. The cases offer virtually the whole spectrum of possible understandings, and applications, ranging from examples of performance improvement in an individual organisation to broad-based processes of social mobilisation and transformation.

This only confirms that our thinking on capacity and capacity development remains fluid, yet fertile, influenced by different intellectual traditions, contexts, vantage points and experiences. Clearly, there is no single right answer. The very different case studies presented here, and the range of approaches applied to address capacity attest to this.

But where concepts lack precision, and meanings are implicit rather than explicit, there is a risk of creating misunderstanding as well as of raising different expectations among stakeholders. The cases do point to the fact that stakeholders within the same programme may not share the same understanding. And the viewpoint of case authors may not be shared by those directly involved in the programmes under study. Also, a number of cases show how thinking on capacity questions has evolved over the life of a programme. Yet, amidst conceptual diversity, the case studies do reveal a certain red line of understanding running through, even if at a relatively high level of generalisation.

How is Capacity Understood ?

The "instrumental" notion of Capacity as the ability of individuals, organisations, or societies to set and implement development objectives on a sustainable basis, runs through many of the cases. Moreover, reference is increasingly made to questions of performance, effectiveness and accountability, for example in the studies on the Public Service Reform Programme in Tanzania and the Nigerian Red Cross Capacity Building Programme.

Capacity is also viewed from a more dynamic perspective - a continuous process by which individuals, groups, institutions, organisations and societies enhance their abilities to identify and meet development challenges in a sustainable manner. Here greater emphasis is placed on questions of role and relationships, attitude, and responsibilities at inter-organisational and societal levels. Examples include the Ethiopian Civil Society programme on public participation, and the Bangladesh study on micro-credit and the poor.

Levels of Capacity; Individual, Organisational and Societal

The case studies demonstrate how capacity issues are treated at different levels – the individual, the organisation or entity, the sector, and societal levels. Some cases suggest that the inter-connectedness, and inter-play of these levels is increasingly recognised, and taken account of in programme design.

Individual capacities, understood in terms of skills and aptitudes (usually acquired through training) are considered as a necessary but not sufficient part of the capacity equation. But understanding how individual capacities are harnessed, and translated into organisational capacities, raises the question of incentive frameworks, and to the supportiveness of the wider organisational environment.

Organisational capacity is likewise influenced, not only by internal structures, systems and procedures, but by the collective capabilities of its staff, on the one hand, and by external factors in the wider institutional environment - such as the policy framework, and other political, economic and cultural factors – on the other hand. These may constrain or support performance and influence issues of organisational credibility and legitimacy.

In most of the case studies, the entry point for examining capacity questions is in fact the organisational level. To different degrees, the cases illustrate how capacity questions at other levels are also taken account of. Inevitably, as focus shifts from the individual level to societal levels, questions of capacity and how to address them become more complex and interrelated. The Bangladesh study provides the best example of this, acknowledging that the conceptual framework applied sits at the far end of the spectrum.

A "systems" approach to understanding capacity development - evident in some of the cases - can help to sort out inherent complexities, and in so doing to provide a basis for strategic design.

Elements of Capacity

Experiences suggest that capacity deficits or weaknesses can rarely if ever be attributed to a single cause. The cases show that there are indeed many different sides to capacity. The DfID studies, for example, distinguish between what are referred here to as hard and soft elements.

The "hard elements" refer to obvious things like personal skills, functions, structures, systems and to factors such as equipment, infrastructure and financial resources. These elements, are for example, discussed in several of the Policy Institute case studies. The soft elements refer to less easily definable and quantifiable factors. These are often related to so-called incentive, motivational and demand factors, of a material, cultural, or social nature. For personnel, this may mean financial, career and professional incentives, or more widely to questions of attitude and mind-set. At the organisational level, this can refer to aspects of policy, legitimacy, norms and values, as well as to wider questions of governance. The DfiD papers refer to notions of Exit, Loyalty and Voice as key dimensions of the incentive framework which can influence personal and organisational behaviour.

How is Capacity Built, Developed, Acquired, Attained ?

Increasingly, it is accepted that capacity programmes are more successful, and are more likely to be sustainable when they respond to an internal initiative, and when they are supported through a process approach, and not through single one time events. Issues of ownership, commitment and leadership are moreover central to this notion of capacity as process. This process dimension is revealed in a number of the cases, although it is perhaps absent in others. The International Federation of the Red Cross place emphasis on this point; thus capacity development is seen as;…a systematic approach of continuous learning ……

Recognition of capacity development as process carries implications in particular for the roles performed, and approaches used by external aid organisations in working with local organisations. The influence of donor practices on capacity processes, and the consequences for retooling are addressed in the Ugandan study on sector wide approaches, and the CIDA study on governance programming.

Capacity for What ? – Programme Objectives and Scope

How have these concepts been applied in practice ? What aspects or dimensions of capacity have been addressed, and what interventions have been carried out or plannned ?

Nigeria Red Cross Society Capacity Building Programme

The case provides an example of capacity development at the organisational level (albeit in relation to a membership organisation structured around a network of branches), responding to pressures for change and a consequent need to re-tool. The impetus for change can be traced to factors related to the domestic environment, as well as to pressures to conform to a set of institutional standards set by the International Federation.

The programme seeks to create an organisation which is accountable, and performing. On the basis of an extensive preparatory and diagnostic phase, comprehensive reforms have been introduced at all levels of the organisation. This includes aspects of Governance (Reforming structures – leadership positions, terms of office, separation of roles), Internal Management (Planning and budgeting, decision-making processes, reporting, building a common vision and new organisational culture, strengthening core competencies; eg: disaster preparedness, reviewing overall structures and functions, and Human Resource Development (recruitment, Training & guidance).

Tanzania Public Service Reform Programme (PSRP)

This case also provides an example of capacity development at the organisational level for performance improvement and accountability. The organisational setting is, however, far more complex, dealing with system-wide questions affecting the overall performance of a public service, composed of a multiplicity of ministries, departments and agencies.

It seeks to address the question: how to turn individual competence into organisational capacity ?, something which earlier reform initiatives in Tanzania, as in many other countries, have not been able to fully resolve. The programme focuses on aspects of the incentive framework, with the view to providing an enabling environment across the system. In so doing it tries to address factors constraining performance such as poor governance, weak upward and downward accountability, poor pay and poor professional morale. Thus both hard and soft aspects of capacity, alluded to before, are addressed.

This approach is considered critical in order to unlock and mobilise existing capacities. It represents a strategic priority, with potential benefits being felt through-out the organisational system. The approach is informed by the New Institutional Economics and New Public Management, and is seen as a key step in inculcating a new management culture within the public service. The authors however query the extent to which the approach is appropriate in fragile administrations where basic pre-conditions cannot be guaranteed. Difficulties associated with inadequate coordination between different reform initiatives, as well as insufficient capacity to manage complex change processes is also signaled.

Ugandan Education Development Sector Programme

This case study provides an example of the Sector-Wide approach (SWAP). Capacity issues are an integral part of programme design, seeking to enhance overall sector performance, particularly where donor finance, and therefore presence, remains significant.

SWAPs aim to support capacity development by promoting policy dialogue between partners, working towards a common budgetary and reporting framework, and utilisating local structures and expertise. In so doing, to also provide targetted capacity support to key sector stakeholders to perform core management functions; planning, budgeting, reporting etc.

Within the lead agencies of central government, the initiative is linked to wider reform initiatives such as the public service reform programme, and the decentralisation programme. Issues of sequencing and timing arise in terms of ensuring that the issues of incentive, as discussed in the Tanzania case, are addressed so as to ensure that capacity work at the sector level is possible.

SWAPs also look beyond central government agencies and involve lower tiers of government (local authorities), schools and school boards. This broadens the capacity building agenda immensely both in terms of addressing capacity issues within the respective organisations and entities, but also in terms of improving accountability and coordination between these levels. To balance the programme’s focus at the Ministry level, a Schools Facilities Grant for local construction has been set up to encourage local initiatives.

CIDA - Ethiopia Governance Programme

In this case study, the complex process of developing a policy framework between a donor and a partner country to address governance and capacity issues is presented, together with illustrations of two specific initiatives which have emerged from this process. For CIDA, providing support to Ethiopia’s political reform process represented a new challenge, and a departure from classic areas of support. A strong case is made for developing strategies grounded on thorough preparatory work, and taking account of the need to develop internal capacities too.

• The Court Administration Programme

A step by step approach has been proposed starting out with relatively straight forward activities to strengthen basic administrative competencies (training needs assessment, systems etc) and then moving towards facilitating wider strategic reflection (strategic planning and dialogue). A participatory approach is used aimed at building ownership into the process, and so avoiding an externally-driven projectised approach.

• The Civil Society Programme

• Upgrade skills for programme delivery; via information dissemination, involvement of experts and facilitation of dialogue processes.
• develop organisational capacities for networking, advocacy, expertise, management, leadership and programme delivery. As such it includes both tangible organisational capabilities and intangible aspects of capacity (vision, autonomy, solidarity).

The benefits are expected to be felt beyond the immediate targeted organisations. It is therefore acknowledged that results may take decades to show through with implications for evaluation methodologies.

Bangladesh Micro-Credit Programme

This study examines how far micro-credit develops the capacity of the disadvantaged to overcome poverty. It looks at the role played by micro-credit institutes in providing loans, and reviews the strengths and weaknesses of the approaches used. Overall it asks the question as to whether micro-credit provides a systematic capacity development strategy against poverty.

Capacity questions are addressed at a number of levels – organisational and societal. In relation to the micro-credit institutes, their roles and relationships with their borrowers, and with their donor sponsors is discussed. Issues of downward and upward accountability arise. Relations between these private and no-governmental organisations with government institutions is also discussed, raising wider questions about policy coherence and complementarity of initiatives in relation to combatting poverty. In other words, how to marshall national capacities to address poverty.

Crucially, the study asks if the focus of capacity development should be on the survival of the micro-credit institutes (organisational perspective) or on the empowerment of the poor to overcome structural constraints (a societal perspective). Do such lending organisations have a built in exit strategy, and how do they adapt themselves to the demands and needs of their constituencies.

The Policy Analysis Institutes

These case studies focus on the role that policy analysis institutes can play in building national capacities for policy analysis and policy formulation. While all the policy analysis institutes share similar mandates and have received support from the ACBF, they have gone about their tasks in different ways, reflecting different national contexts, institutional set-ups and organisational priorities.

Creating new organisations, or strengthening existing ones to support wider policy processes has been a key element of ACBFs capacity building strategy. Variations have been applied in terms of the location of the institutes, and the strategies used to interact with wider processes, and the institutional environment. The cases reflect to different degrees how they have addressed aspects of internal capacity building, especially training, and how they have set about building capacity within the wider institutional environment. Some give more priority to delivering quality advice, others see a role in supporting wider processes of policy dialogue and constituency building. However, explicit strategies are not presented.

All of these cases address the thorny question of financial sustainability. The institutes are confronted with a dual challenge of on the one hand assuring organisational survival, which can drive them towards more commercial engagements, and, on the otherhand, fulfilling their wider capacity building responsibilities, which are perhaps less financially viable.

Capacity Development – A Process Approach

This section focuses on the so-called How questions of addressing capacity development. The case studies point to the centrality of ownership, commitment, leadership and local execution to the realisation of capacity development objectives. This is particularly so where capacity development is associated with significant change (transformational) processes, and where external organisations also play a significant role.

Participatory approaches have been used in many of the cases, ranging from those which focus more on the internal dimensions of organisational development, to those focused at wider inter-organisational and societal changes. The emphasis given to ownership and commitment also carries implications for the way in which internal and external organisations work together in supporting capacity processes. The concept of partnership also arises in this context.

The Capacity Building Programme of the Nigeria Red Cross was implemented in 1997, but had its roots in initiatives taken four years earlier. A number of upstream actions were taken to support programme design, including a joint evaluation with the Federation, the results of which were fed into an internal consultative process resulting in the adoption of a three year plan. Capacity and vulnerability assessments at branch level (there are 36 branches) were then conducted as a basis for developing more detailed plans.Consultative processes provided opportunities for all levels of the organisation to participate. Building a wide constituency for change was key according to the author for building legitimacy and overcoming any resistance.

What of the role of the International Federation ? Whilst, it played a significant supportive role through-out, the management of change was recognised to be an internal responsibility. The federation provided technical inputs to the joint evaluation and then provided support during the implementation phase. External support to the process was considered essential in several respects; financial, in terms of meeting certain salary costs, and policy wise in terms of setting a framework for adopting a set of governance principles. It is interesting that the author remarks that the Federation could have been more forceful in this area. In this respect, it is worth noting that national societies belong to an international movement, and as such are expected to subscribe to a set of shared core values. This changes in some ways the nature of the relationship between external and internal players.

What is less clear from the study is the extent to which local stakeholders – persons and communities which benefit from services provided - were consulted at all during the reform process.

The DfID case studies illustrate how Public service and sector-wide reforms bring about fundamental changes to the organisations and personnel involved. Changes in roles and functions, management styles, incentive structures place additional burdens on change agents to ensure that ownership and commitment are present deep into rank and file of the organisation.

In Tanzania, the PSRP, seeks to secure greater local ownership of the reform process. Significant innovations, representing departures from the past, include the closure of former project implementation units (eg: the reform secretariat, perceived as a priviledged enclave) and the transfer of its remit directly to the Civil Service Department. This has reinforced the perception of a government-driven agenda, rather than a donors’, with a core group of committed persons driving the process from within. Yet, the case reveals that there remains heavy reliance of external expertise, to introduce far-reaching management innovations.

But ownership of major reforms, and the commitment to stick to the process, requires wider and deeper support both from political leadership and from decision-makers within line/sector ministries and departments. For the political leadership, the case suggests that orienting reform around issues of performance is more attractive than the earlier focus which was on size and cost, and associated retrenchment. This had created a credibility gap.

At the Ministry level, there remains a perception that the reform is being imposed by the Civil Service Department. Incentives for the rank and file to commit themselves to a new performance culture are brought into question so long as basic issues of pay and conditions of service are not resolved. Various initiatives are however being introduced to nurture support, including a Public Investment Fund which offers incentives to line ministries to take initiative in designing their own reform programmes.

The Uganda study points to several aspects of how external–internal relations can have repercussions for capacity building. The rationale behind SWAPs is to promote a dialogue between external and internal stakeholders towards defining common interest, and to promote local leadership and programme execution. Parallel structures are avoided, while common financing, accounting and reporting procedures are encouraged. These are all recognised as important elements of a capacity development approach. In practice, the extent to which donors are willing and able to let go, and to support common implementation arrangements is questioned. Nevertheless, there is satisfaction that the process is locally driven, and that the donors are performing more of a facilitating role.

The Ethiopia case study underscores the importance of building trust and common vision among partners, especially in difficult areas such as governance. The emergence of a partnership between CIDA and Ethiopia is itself viewed as a process of learning and adjustment. This provides the policy and strategic framework for more specific governance work. However, finding common interests has not been easy; CIDAs concept of capacity development as a process, has been an uneasy fit with local stakeholders looking for short-term trouble-shooting technical assistance. The result was a financial framework developed with little Ethiopian involvement. Curiously, it is noted that the lower priority accorded to judical reform by the government meant that there was less pressure for short term results. This gave CIDA space to invest in a longer term process of strategy and capacity development.

The work on strengthening the judiciary shows how the role of CIDA has changed over time from emphasizing getting tasks completed to facilitating their completion by Ethiopians. The initial TA support delivered an urgently needed product, but according to the case, had little impact on capacity, although it did support a process of strategy development (discussed elsewhere). The new CIDA approach of facilitation calls for attention to the use of local expertise in diagnostic and preparatory review work, as well as consultations with key stakeholders. Working with Canadian-Ethiopian teams was critical. There was also recognition that having a local generalist with a feel for the environment was as important as any imported technical expertise.

By its nature, the court administration programme has not been very participatory, restricted to a core group of senior level stakeholders. However, unlike traditional programmes restricted to the executive, the judiciary and legislature are involved. The broadening of constituencies does make the process of consultation, dialogue and task division much more complex, especially where roles are not well defined.

The case study suggests that the high level of participation of the Federal Supreme Court has encouraged a high degree of ownership, leadership and control. In particular, it has ensured that the programme takes account of the wider political realities within the justice system.

In relation to the civil society programme, CIDA and executing partners have played a key role in setting the rules of the game for the programme, especially in terms of methodology development and setting criteria for participation. At the same time, consultative and advisory structures have been set up with broader based representation to review proposals and give advice on wider institutional and policy considerations (national Programme Advisory Committee).

Because the programme deals with processes and not products, local participants are viewed as partners rather than recipients with a lead role to play. However, the introduction of participatory methodologies into local organisational change process needs to take account of management styles which tend to be more hierarchical in nature, and where there may be resistance to a more bottom-up approach.

The emphasis given by CIDA to facilitating processes is not necessarily shared by all. A case is cited of a participating organisation which appealed to CIDA to provide resources for infrastructure provision purposes, and not see the immediate value of the process dimension. This suggested a difference of meaning of capacity development.

The set of Policy Institute studies also offer interesting insights. Issues of ownership and participation can be identified at three levels. At the first level is the relationship between ACBF and its partner institutes. Whilst generally, ACBF has responded to local initiatives, experiences vary as to the extent to which they have provided a leadership or facilitating role. In some cases, where a new organisation has been set up (Cote D’Ivoire and Senegal), the role has been perhaps more interventionist. Where organisations already existed, (Uganda, Namibia), the role has been more facilitative. The second level concerns capacity building of the institutes. Here the record is very mixed, ranging from minimal where capacity building efforts are confined to training (Uganda, Senegal and Cote D’Ivoire), to significant where the aim has been to institutionalise common visions among staff (Tanzania) or address a re-organisation process (Namibia). The third level concerns the relationship between institutes and the wider policy making environment. As newcomers to the policy analysis/formulation environment, the studies illustrate the strategies used by the institutes to nurture relations in order to establish their bona fide, and to overcome inevitable hostilities. Building wider ownership is key to their own sustainability and ability to respond to their constituencies. Institutes, such as the ESRF, in Tanzania,also emphasize their networking and facilitating function as a neutral platform among institutional stakeholders, attach particular importance to this dimension.

Questions of ownership, leadership and participation are addressed in the Bangladesh case study also. As alluded to in the earlier section, concerns are raised about downward accountability and transparency. There is a sense in which micro-credit institutions function in a top-down manner, where the poor are treated as passive beneficiaries, rather than stakeholders with contributions to make to the decision-making process. It is suggested that consultation, when it happens, takes place once the rules of the game and limits have been set. This may already mean that criteria set will exclude certain groups – the most disadvantaged. This is symptomatic of what is described as a project mentality based on pressures to disburse. Little room is left for taking up process dimensions, and for considering aspects of wider capacity mobilisation.

A Strategic Approach – Upstream Diagnosis

The growing complexity of capacity development, both in terms of the many facets, and in terms of the interplay between levels, calls on programme designers to adopt a more considered strategic approach. Seeing the bigger picture, in terms of how the different parts of the capacity jig-saw fit together requires an investment in up-front diagnosis and assessment as part of programme design. This can help toward addressing issues of task division, sequencing and managing assumptions. In keeping with the participatory approach, such diagnoses ought to be carried out with the full involvement of affected stakeholders as part of an on-going monitoring and evaluation process.

The Ethiopia study contrasts two experiences in order to emphasize the importance of upstream preparation, from a donor perspective. In so doing, the study presents a number of internal capacity challenges (see below). The study emphasises the importance of having at hand a clear intervention strategy which should be based on a full appreciation of institutional and capacity questions. The need for more information, more assessment and more analysis is emphasised. This is especially the case for external agencies working in complex and often unfamiliar areas of institutional reform and governance, where policy lines may be unclear, contradictory and issues sensitive. Here, emphasis is also placed on the strategic importance of dialogue as a basis for building trust, and a common understanding of problems to be addressed.

It also points out that when capacity building has to do with fundamental change, then the political and cultural realities require the donor to proceed with caution, sensitivity and respect, seizing opportunities where changes are welcome.

The case suggests that whilst short term interventions can be realised on the basis of a relatively weak strategy, as in the case of support to the preparation of new legislation, prospects for securing sustainable solutions and capacity development are unlikely. Later interventions, based on adequate preparation, and supported by in-house advisors, and extensive consultation are more likely to yield long term results.

With specific regard to the civil society programme, an elaborate appraisal process has been set up involving assessment of submitted proposals, the preparation of an organisational profile, including capacity mapping, and then detailed design using participatory methods.

But the case study also signals the inherent costs and risks involved. There is need to balance questions of urgency with those of effectiveness. An exploratory phase enables adequate upstream preparation, but it increases the time scale and postpones the realisation of tangible results. This can be problematic both for partners and funders looking for results, while it raises programme costs significantly without offering at the outset guarantees of results. A solution is to build in short term activities to demonstrate that something is happening while the longer-term programming takes place. It also suggests that there is perhaps not a shared understanding of the concept of capacity development. This is especially so in relation to the civil society programme, where it is concluded that the initial expectations of a full launch of the programme within 4 years was unrealistic.

Capacity to Manage the Process and Play new roles

CIDA found that it had its own constraints to playing a new role of managing the process, rather than tangible results. Fielding of a regional advisor on governance and democracy has helped the transition to the new role, as has drawing on local expertise. The report notes the importance of mobilising teams composed of a mix of policy specialists and institutional development generalists with capacities to address the overall situation, decision-,making and the institutional set-up, and the capacity to engage in dialogue.

The Tanzania PSRP reveals the insufficient reform management capacties, inadequate internal coordination and dialogue, as well as continuing pressures to respond to donor agendas will undermine ownership. If it is accepted that reform and related capacity development is always a long-term process, and is not about short-term fixes, then building sustainable local capacity to see reform processes through is critical. The PSRP case studies however cautions that as our concepts and programmes of capacity development become more sophisticated, additional pressures will be placed on local organisations to manage the complexities. A gap can emerge between our capacity development ambitions and our capacities to deal with this. For local organisations, this can place additional pressures to call on external expertise.

Capacity and Evaluation

Evaluation remains a sticky area for capacity development. It’s importance is not questioned, but their remain conceptual and methodological difficulties. The case studies reflect this situation, with only scanty attention paid to the issue.

It is not difficult to see why. Adapting evaluation methodologies to take account of institutional development and capacity questions is not easy. Difficulties include, selecting appropriate time scales, choosing suitable indicators, and dealing with issues of attribution, and so on. A balance also needs to be struck between using evaluation for external accounting purposes and treating evaluation as a basis for organisational learning and performance improvement. What experiences can be drawn from the case studies ?

The Ethiopia case neatly highlights the tensions faced by a donor to respond on the one hand to pressures to demonstrate short-term and concrete results, and on the other hand, to respect the inherently soft and long-term character of institutional and capacity development processes. This point is also raised in Bangladesh, as is perhaps also relevant in terms of demands placed on the ACBF to account to its sponsors. The pressures for results arises from increasingly sceptical public opinion about the use of aid, as well as to the character of programme logics (logframe) which priviledge project approaches. It is perhaps a reflection of how administrations in northern countries, have themselves had to adopt a more output orientation, as a result of their own reform experiences.

Several cases suggest that the increasing importance attached to output, and not to input, is critical to improving the capacity to perform, as well as to improve accountability to stakeholders and constituencies.

The Ugandan case emphasises the importance of setting up a robust monitoring/reporting mechanism to feed the whole process with information, and, in so doing, to assure success in a complex, multi-agency and sector wide programme. It also assures accountability both upward (to donors) and downward (to sector stakeholders).

When conducted in a participatory manner, involving key internal and also external stakeholders, continuous performance monitoring can contribute to organisational learning and capacity enhancement. This is suggested in the Ethiopia civil society programme where local organisations are encouraged to set and review their own performance and process indicators. This emphasis, reflects the deeper notion of capacity development, discussed earlier, which emphasises the aspect of continuous learning.

Performance monitoring is also a feature of the PSRP in Tanzania. Based on lessons learned from earlier reform initiatives, monitoring and evaluation has become less donor-driven, and is being progressively built into the reform process steered by the Civil Service Department. Crucially, it notes that so long as reporting responds to externally-imposed accounting requirements, and not on internal organisational performance considerations, then the incentive for staff to support the reporting system will remained weak. Hence, the effort to internalise and re-orientate the process. Yet, the authors point out that continued donor pressure to account for expenditures, has meant that even with the changes made, there is a tendency to overlook the internal dimensions.

Although no specific evaluation methodology is described in the Red Cross study, important questions are raised about how to go about measuring outcomes over the course of a long change process. What is the relationship between organisational reform and delivering better results. Is the internal reform process an end in itself, and must it be evaluated in terms of wider impacts ?. Here, issues concerning attribution, selecting an appropriate time frame, and selecting suitable indicators comes into play.

Notwithstanding the very strong case made for focusing on performance as a contribution to capacity development, questions are raised as to its suitability where interventions are primarily concerned with supporting the build up of new institutional relationships, or where the focus is on changing attitudes and mindsets – the softer sides of capacity development. In these cases, demonstrable change may take decades to show through - certainly beyond the lifetime of the intervention. The report on the Ethiopia Civil society programme states categorically that it is about delivering processes and not products. Results are therefore defined in terms of people being able to influence the decision-making that affects their lives. 6 dynamic outcomes are presented with qualitative and quantitative indicators. These process indicators are about how organisations behave, rather than what they deliver. These are of potential interest to other organisations.

The Ethiopia study further argues that Process considerations need to be better reflected in the logframes that funding agencies tend to use. It pleads for a more open-ended interpretation of products, whilst admitting that we need to give more precision to our understanding of process.

The Bangladesh study points to an absence of suitable mechanisms to measure performance of micro-credit institutions, in terms of impact on capacity building. This is ascribed to the fact that there really is not a conceptual framework for capacity building, around which to structure an evaluation methodology. Evaluation has become more important in recent years, but once again, primarily in response to donor pressures to improve external accountability. It also notes the absence of downstream stakeholders in any evaluation process. This raises questions of downward accountability.

The collection of ACBF studies also raise interesting questions about outcome and impact, although they show that more work needs to be done in developing an evaluation framework which takes account of capacity issues. Whilst it is comparatively straight forward to measure performance in terms of outputs (products and services) it becomes a more difficult to demonstrate how these outputs translate into wider capacity outcomes, or how support to dialogue processes generates capacity outcomes. Given the mandate of the policy institutes to contribute to wider societal capacities for policy analysis, this seems to be a priority.

Meanwhile, the Policy Institute case studies do provide some anecdotal evidence of impact, and how their own performance is measured. The Cote D’Ivoire study admits that a formal methodology has not been developed, particularly concerning impact on wider processes, but the study offers a set of possible proxy indicators that would take more account of capacity questions.

Where capacity development is understood as involving more than participation in the generation of analysis, but concerns mobilisation and changing processes of dialogue and consultation, then the task of evaluation becomes more complex.