47871 World Bank Institute Renewal Strategy An Emerging Direction March 20, 2009 Contents Page Abbreviations………………………………………………………………………... iv Executive Summary……………………………………………………………........ v I. Introduction ………………………………………………………………... 1 II. The Need for a New Strategic Direction ………………………………….. 1 New Country Demands and Opportunities …………………………………. 2 The Bank’s Knowledge and Learning (K&L) Agenda ……………………... 2 The 2007 Assessment of WBI ………………………………………………. 2 III. Consultations on WBI’s Role and Strategy ……………………………… 3 External Consultations ……………………………………………………… 3 Internal Consultations ………………………………………………………. 5 IV. Vision and Mission ………………………………………………………… 5 V. Key Shifts in WBI’s Strategy ……………………………………………... 6 VI. Key Business Lines ………………………………………………………… 8 Structured Learning …………………………………………………………. 8 Knowledge Exchange ……………………………………………………….. 11 Innovation …………………………………………………………………… 12 VII. Strategic Selectivity ………………………………………………………... 14 VIII. WBI’s Anchor Role for Capacity Development …………………………. 15 IX. Focus on Results …………………………………………………………… 16 X. Implementation Agenda …………………………………………………... 17 Completing Consultations and Finalizing the New Strategy ……………….. 17 FY10 Program and Beyond …………………………………………………. 17 Organizational Implications ………………………………………………… 18 Financing Implications ……………………………………………………… 18 Managing the Risks …………………………………………………………. 19 XI. Questions for the Board …………………………………………………… 20 Boxes 1. From Retail to Wholesale: WBI’s China Program ………………………………... 7 2: WBI’s Services to the World Bank Group…………………… 8 3. Structured Learning: Working with Country and Regional Institutions …………... 10 4. Flagship Structured Learning Programs …………………………………………... 11 5. Knowledge Exchange: Practitioner Networks and South-South Learning ……….. 12 6. Innovation: Replicating the Development Marketplace …………………………... 14 Annexes 1. WBI Budget and Staffing …………………………………………………………. 21 2. A New Results Framework for WBI …………………………………………….... 22 iii Abbreviations AFDC Asia-Pacific Finance and Development Center AFR Africa Region ANSA Affiliated Network for Social Accountability APEC Asia-Pacific Economic Cooperation ASCI Administrative Staff College of India AWA Arab Water Academy BIPARD Bihar Institute of Public Administration and Rural Development CABRI Collective Africa Budget Reform Initiative CAS country assistance strategy CIDA The Canadian International Development Agency CODE Committee on Development Effectiveness CPS Country Partnership Strategy DAC Development Assistance Committee (OECD] DEC Development Economics Vice Presidency DGF Development Grant Facility DM Development Marketplace EAP East Asia and Pacific ECA Europe and Central Asia Region ED Executive Director EDI Economic Development Institute GDLN Global Development Learning Network GICT The Global Information and Communication Technologies Department GIFT-MENA Governance Institutes Forum for Training in the Middle East and North Africa GPP Global Programs and Partnerships Unit IDF Institutional Development Fund IEG Independent Evaluation Group INT The Department of Institutional Integrity InWent Internationale Weiterbildung und Entwicklung GmbH (Capacity Building International, Germany) IPRCC International Poverty Reduction Center in China IREX International Research and Exchanges Board ITC-ILO International Training Centre of the International Labour Organization JICA Japan International Cooperation Agency K&L Knowledge & Learning KSG Knowledge Strategy Group KILA Kerala Institute of Local Administration LenCD Learning Network on Capacity Development M&E monitoring and evaluation MENA Middle East and North Africa Region MIC middle-income country OECD The Organization for Economic Co-operation and Development OPCS Operations Policy and Country Services PPPI public-private partnerships in infrastructure PREM Poverty Reduction and Economic Management Network QAG Quality Assurance Group Tec de Monterrey Instituto Tecnológico y de Estudios Superiores de Monterrey Train4Dev The joint donors training network UK-DfID Department for International Development (United Kingdom) UNDP The United Nations Development Program VPU Vice Presidential Unit WBG World Bank Group WBI World Bank Institute iv Executive Summary 1. The need for a new strategic direction for the World Bank Institute (WBI) arises from country partners’ growing demands for global knowledge and learning (K&L) customized to the local context, the rapid expansion in K&L institutions worldwide, technological changes that are fundamentally transforming K&L access and delivery, lessons from several internal reviews of WBI, and the World Bank Group’s rethinking of its overall K&L agenda. Based on extensive ongoing consultations with internal and external partners, this note describes the emerging vision for WBI and proposes a medium-term renewal strategy for WBI as an integral part of the Bank’s K&L agenda. The note is intended as background for discussion with the Executive Directors to elicit their guidance. 2. Vision and Mission. The emerging vision is for WBI to become a global facilitator of capacity development for poverty reduction. WBI’s core business will be to facilitate learning, knowledge exchanges, and practitioner-generated innovations, all with a view to addressing the key capacity constraints facing leaders, institutions, and coalitions in their pursuit of development results. It will do so by connecting and leveraging global expertise on the “how� of reform through country and regional institutions and practitioner networks. 3. Key Strategic Shifts and Main Business Lines. The above vision suggests several important changes in WBI’s approach in order to achieve greater impact and results: (i) moving from a “retail� to a “wholesale� model by working with regional and country institutions, and through the use of technology, for greater customization and to achieve a more durable and scaled-up impact; (ii) substantially strengthening knowledge exchange – just-in-time practitioner exchange, South-South learning, and peer networks – and introducing a new business line – innovation platforms – to complement the traditional business line of structured learning; (iii) specializing in the “how� of reform, including practitioner knowledge and processes for consensus-building; (iv) forging much stronger external and internal partnerships for greater leverage and impact; and (v) focusing on high- impact strategic priorities by rationalizing the currently dispersed thematic spread. 4. In the business line on structured learning, WBI will scale up the customization and delivery of flagship courses through country and regional institutions, and through the expanded use of technology. Knowledge exchange activities will facilitate policy debates on frontier issues (e.g., alternative development paradigms in the aftermath of the global economic crisis), just-in-time sharing among practitioners through peer networks, and multi- stakeholder dialogues to build consensus around reforms. The Global Development Learning Network (GDLN) will play a central role. The innovation business line will provide platforms, such as the Development Marketplace, for sharing and incubating practitioner-generated innovations that address priority development challenges. The move from retail to wholesale in all three business lines will be introduced gradually, while retaining strategically important retail programs. v 5. Anchor Role for Capacity Development. The consultations have identified a newly emerging role for WBI as anchor for the growing number of capacity-development initiatives within and outside the Bank. In this new role, WBI would serve as a central resource on capacity development, identifying frameworks, tools and good practices, and connecting and facilitating the work of capacity development teams and activities in different parts of the Bank and beyond. 6. Strategic Selectivity. Past assessments and the recent consultations underscored the need for greater strategic selectivity. The emerging strategy calls for a substantial rationalization of the currently dispersed thematic spread of WBI’s programs into four cross- cutting themes that reflect corporate priorities and strong country demand (fragile and conflict-affected states; the global economic crisis; governance; and climate change) and a few selected sectoral priorities (e.g., health systems, public-private partnerships in infrastructure and sustainable urban development). The final selection of priority programs will be made at the conclusion of the consultation process. 7. Focus on Results. WBI has developed a framework that will provide a common results platform for its capacity-development programs, thereby helping to tighten their strategic focus. The framework is currently being piloted. It will be refined in the coming months and discussed with the CODE in Fall 2009. WBI’s internal quality assurance and results monitoring function will also be enhanced, and WBI’s programs will be subject to the same independent quality assurance and evaluation as the rest of the Bank’s operations. 8. Implementation. The new strategy will be finalized by May 2009. Implementation will begin in FY10, with the piloting of several flagship programs aligned with the renewal strategy. It will also require organizational renewal, and a strengthening and rebalancing of the skills mix in WBI, which will be achieved over the next eighteen months. 9. Managing the Risks. Change on the scale envisaged in the WBI renewal strategy inevitably poses implementation risks. An initial and major step in mitigating these risks is been the highly participatory manner in which the strategy is being developed with extensive external and internal consultations and feedback. Other risk mitigation factors will include a new management team with the requisite experience; a program to strengthen the skill mix including with external world-class experts on short assignments; and a multipronged approach that recognizes the different needs of countries with varying levels of existing capacity. Considerable attention will also be paid to monitoring implementation to ensure that risks are continuously and openly assessed and corrective actions are taken promptly. The consultations have clearly shown that the potential benefits of WBI's renewal strategy for the WBG and the development community are very high, and far outweigh the risks. vi I. Introduction 10. The World Bank Institute (WBI) has long been a major contributor to the World Bank Group’s (WBG’s) knowledge and learning services. As the Bank seeks to revitalize its knowledge and learning (K&L) agenda in response to changes in the external environment and country demands, WBI needs to be an integral part of this effort, and its strategy needs to align closely with current corporate priorities and client needs. 11. This note describes the current status of a medium-term renewal strategy for WBI. It reflects feedback from broad consultations within and outside the Bank, describes a vision for the Institute, proposes key shifts in business lines, and outlines how the strategy will be implemented. It provides background information for consultations with the Executive Directors to elicit their views on the proposed strategy and their advice on key outstanding issues. The strategy will be finalized in May 2009 and implementation will begin in early FY10. 12. For more than fifty years, WBI (formerly the Economic Development Institute (EDI)) has been the Bank’s principal provider of learning activities for its developing country partners. It has designed and delivered training courses, seminars, and workshops for several generations of government officials. In its early years, EDI provided courses for senior policy officials on macroeconomic, sector, and policy analysis, primarily in Washington DC. During the past decade, WBI expanded its activities to include a wide variety of sectors and themes aligned with the Bank’s networks; broadened its audiences to include non-state actors such as civil society organizations, journalists and parliamentarians; and adopted a “focus countries� approach to provide a higher level of support to selected countries based on Regional priorities. 13. In 2007-2008, senior management carried out an assessment of WBI, responding in part to questions raised in CODE and IEG reviews about the Institute’s effectiveness and results. Following this assessment, President Zoellick appointed a new WBI Vice President in October 2008 with a mandate to prepare a WBI renewal strategy as part of the World Bank Group’s (WBG’s) larger effort to revitalize its knowledge and learning agenda. In particular, senior management suggested that WBI scale up its work with regional institutions, promote South-South knowledge exchanges and provide platforms for sharing and incubating practitioner-generated innovations, for example, through the Development Marketplace which moved to WBI in late 2008. II. The Need for a New Strategic Direction 14. WBI’s need to adopt a new strategic direction originates from new demands by country partners, from rapidly evolving opportunities in the knowledge and learning (K&L) field; from changes in the Bank’s own broader K&L agenda; and from lessons learned from the 2007 WBI assessment conducted by the Bank’s senior management. 1 15. New Country Demands and Opportunities. Country demand for K&L has become increasingly sophisticated. Practitioners want to learn from other practitioners in both the South and North about the “how� of reform, including how successful solutions elsewhere can be customized to their local context. They want just-in-time support and knowledge from other practitioners confronting similar challenges, for instance, in managing fiscal stimulus during the global economic crisis. Policy makers are looking for innovative solutions to frontier challenges such as youth and violence, fragility, and conflict. Middle- income countries are interested in learning both from each other and from the successes and failures of the OECD countries. Fragile and post-conflict states are struggling to build state capacity as they face the formidable challenges of maintaining peace and negotiating complex political economy dynamics. And countries such as China, Singapore, Russia and Brazil, which are beginning to develop their own external cooperation programs, are looking for help in packaging their development lessons and contextualizing them to the needs of other countries. 16. Today’s globalized world also offers many more opportunities for knowledge exchange and learning on development. A large number of global, regional, and national institutions of knowledge and learning—think tanks, training institutes, and universities— have sprung up across developed and developing countries alike. Technology is transforming the delivery of K&L. The WBG is no longer the dominant repository of practitioner knowledge and learning about development. Its new challenge is to connect cutting-edge knowledge from disparate sources and locations and to help practitioners tailor it to solve local problems. 17. The Bank’s Knowledge and Learning (K&L) Agenda. To remain relevant in this rapidly changing world, the WBG must capitalize on and strengthen its unique knowledge assets. Its strategy is to position itself as a knowledge-based organization where innovative solutions are mobilized with speed and agility. Global concerns around the current economic crisis are fueling debate on development policies and challenging existing paradigms, requiring sound analysis and openness to a plurality of views rather than reliance on established models. The Bank’s recent K&L vision statement–Global Excellence: Transforming the Bank’s Knowledge Agenda–highlights the need to promote innovative solutions and to respond more quickly to clients; to connect knowledge, country experiences, and know-how across the Bank and across the world; to facilitate a two-way exchange between global knowledge and expertise and local solutions; to provide a platform for active debate on key development issues; and to focus on the impacts and results of whole development efforts rather than on the outputs of Bank products alone. The WBI renewal strategy represents an essential element of the Bank’s response to these challenges and opportunities in the K&L agenda. 18. The 2007 Assessment of WBI. Prompted by questions raised in the 2005 CODE review and other critical reviews of WBI, the Bank’s senior management conducted its own assessment of the Institute in 2007. The study found that WBI’s strengths lay in its corporate-level position which extends across Regions, countries, and sectors; its expertise in adult pedagogy and learning technology; its dedicated mission of learning and knowledge sharing for capacity development; its network of partner organizations; and its 2 success in innovating and incubating some key new ideas. At the same time, its effectiveness and impact were found to have diminished in recent years. In particular, the combination of the “focus countries� approach and the very large number of individual activities (more than 700 per year at the time) made for excessive dispersion of resources and variable quality of output, leaving important institutional demands, and needs of “non- focus countries,� unaddressed. The assessment called for an explicit prioritization of activities and explored various options for WBI’s future, ranging from a focused core training institute (the original EDI role) to serving as an anchor for capacity development, noting that these stylized options could be combined into a hybrid model to meet today’s diverse learning needs. III. Consultations on WBI’s Role and Strategy 19. The new strategy has benefited from extensive and ongoing consultations. External consultations were held with a range of stakeholders, including government officials, think tanks, partner institutions, civil society organizations, and donor agencies across a range of partner countries in all regions. The countries covered through external consultations (visits and videoconferences) included Bangladesh, Brazil, China, Egypt, Ethiopia, India, Japan, the Kyrgyz Republic, Mexico, Morocco, the Philippines, Russia, Singapore, and Tanzania. Internal consultations were held with the Knowledge Strategy Group (KSG), country directors responsible for Bank operations in Algeria, Benin, Burundi, Belarus, Botswana, China, Côte d’Ivoire, Djibouti, Ethiopia, India, Indonesia, Lesotho, Libya, Madagascar, Mali, Malta, Mauritania, Mauritius, Moldova, Morocco, Namibia, Niger, South Africa, Sri Lanka, Sudan, Swaziland, Tanzania, Togo, Tunisia, Turkey, Uganda, Ukraine, Yemen, and the West Bank and Gaza, and with sector staff, managers and sector directors, as well as all operational vice presidents (including all regions, networks, OPCS, DEC, and the International Finance Corporation), HR, CSR, TRE, IEG, LEG, SEC, the IMF Institute and WBI staff. 20. Feedback received from internal (WBG) and external partners alike confirms that WBI can play a valuable role in facilitating capacity development through its core mandate of providing learning opportunities for country partners, but that it now needs to scale up its impact rather than continue with its traditional retail approach.1 21. External Consultations. Country partners stressed that capacity development is crucial if key actors and institutions are to perform at a higher level to achieve society’s growth and poverty reduction goals.2 They suggested that WBI can play an important role 1 WBI has also had responsibility for staff learning in the past. It intends to retain the current focus on external partner learning, but will continue to provide opportunities for joint staff-partner learning in key topics like fragility and conflict, and managing the political economy of reform. WBI will work with internal partners such as HR and KSG to expand opportunities for joint staff-partner learning and learning through operations. 2 For the purposes of this note, capacity is the availability of resources and the efficiency and effectiveness with which societies deploy these resources to identify and pursue their development goals on a sustainable basis. Capacity development is defined as a locally-driven process of learning by leaders, coalitions and other agents of change that brings about sustainable changes in sociopolitical, policy and organizational 3 in addressing priority capacity constraints faced by both state and non-state actors. They underscored the vast demand for capacity development (e.g., in the context of decentralization) and the need to make existing knowledge available to broad audiences in partner countries. This would require WBI to shift its approach from being mainly a direct or retail provider of courses in overseas locations to working increasingly with regional and country institutions (e.g., training institutes, think tanks, and universities) to support in-country capacity development programs, and to help build their capacity to build capacity. The new approach would have a greater and more durable impact, and would help customize global knowledge to local realities. Given the often weak capacity of country institutions, stakeholders stressed the need for careful sequencing, starting with a strategy of “walking on two legs,� that is, delivering some strategically important retail learning programs while also building the capacity of regional and selected country institutions to implement a more scaled-up approach themselves. 22. External partners also suggested that WBI should integrate more practitioner knowledge in its learning programs, and put more emphasis on facilitating the timely exchange of knowledge and innovations among practitioners over sustained periods: this would mean playing a role as a global connector with an “international brokerage� function, connecting demand and supply of practitioner knowledge as well as connecting country and regional centers that are working on capacity development and practitioner learning. Partners also suggested the need for WBI to facilitate the sharing of innovations among practitioners facing similar sets of challenges, indicating that learning about innovative practices will be highly beneficial. Several think-tanks suggested a strong role for WBI in helping build innovation platforms that look beyond the present global crisis, when existing paradigms or lessons from the past may be perceived to be less relevant. There is likely to be a premium on experimentation with new policies and practices, and collective learning. 23. Although thematic priorities for capacity development vary across countries, partners typically expressed demand for programs in which improving governance and accountability was a cross-cutting theme, for example, in extractive industries, health systems, and local governance to support decentralization. Core public sector skills, e.g. in project implementation, public financial management and procurement, was also a recurring topic. Underscoring that capacity development addresses attitudinal change as well as knowledge and skills, stakeholders expressed strong demand for cutting-edge programs on leadership; integrity, ethics and public service orientation; and consensus- building. Country partners also highlighted the useful role played by WBI in enhancing the capacity of non-state actors (e.g., parliamentarians, media, civil society, and youth). Partners suggested that WBI should routinely integrate and bring together multiple stakeholders in its capacity development programs to build mutual understanding, strengthen social accountability, and forge consensus around reforms. There was also a widely-shared view that WBI had an especially important role to play in fragile and factors to enhance local ownership, effectiveness and efficiency of efforts to achieve society’s development goals. Relevant activities include structured learning programs, knowledge exchange platforms, incubation of innovative ideas, and learning by doing. 4 conflict-affected states. Finally, partners noted WBI’s role in demonstrating the effective use of cutting-edge technologies to facilitate learning and knowledge exchange. 24. Internal Consultations. Internal feedback was consistent with that of external partners and focused on the potential of WBI’s value added in helping to connect the K&L being generated in many dispersed places inside and outside the Bank. VPUs urged WBI to integrate more closely with the rest of the Bank, supporting the efforts of country teams to address key capacity constraints to achieving CAS/CPS goals and leveraging the research and global knowledge of DEC and the Networks. Internal partners also strongly endorsed (i) a shift away from WBI’s present retail approach toward a more wholesale approach, while also maintaining a highly selective set of strategic retail learning programs for senior officials; and (ii) a stronger focus on facilitating just-in-time knowledge exchanges. Several VPUs recommended that WBI take on the role of an “anchor for capacity development,� focusing on country partner learning as its key mandate, on topics that cut across sectors, and on facilitating knowledge exchange among practitioners across regions. They noted that WBI can add unique value by working with and supporting regional and country institutions of knowledge and learning, and by helping foster external networks as a means of developing local capacity. They also highlighted that WBI could develop and provide useful platforms to support practitioner- generated innovation (using approaches such as the Development Marketplace) and stressed the importance of operationalizing and mainstreaming such innovations in Bank operations. 25. Country teams in Bank country offices expressed strong interest in working with WBI to carry out country capacity assessments and to help strengthen country and regional capacity-development institutions, including through Bank projects. The consultations also emphasized that this new role would require WBI to be more decentralized, placing more staff in the field as members of country teams to interface with country partners and institutions. IV. Vision and Mission 26. The vision that emerged from these consultations is for WBI to become a global facilitator of capacity development for poverty reduction. The mission and objectives are to support capacity development of leaders, institutions, and coalitions to help achieve the WBG’s mission of poverty reduction. This will be accomplished by: • Facilitating structured learning, knowledge exchanges, and practitioner innovations to address key capacity constraints to achieving development results, and • Leveraging and connecting global expertise—inside and outside the WBG—on the “how� of reform, customized and delivered through country and regional institutions and practitioner networks. 5 V. Key Shifts in WBI’s Strategy 27. The vision for WBI suggests the following five key shifts if the Institute is to achieve increased impact and results: • Move from “retail� to “wholesale,� developing flagship structured learning programs (e.g., courses and workshops) that can be customized and scaled up through country and regional institutions; facilitating knowledge exchange through peer networks; leveraging technology for broader reach; and franchising new platforms for identifying and sharing local innovations (box 1). The move from retail to wholesale will be introduced gradually, while retaining strategically important retail programs. • Substantially strengthening knowledge exchange activities -- just-in-time practitioner exchanges, debates on frontier development issues, South-South learning and peer networks – and introducing a new business line – innovation platforms – to complement the traditional business line for structured learning. The newer business lines are expected to grow in importance given the growing demand for just-in-time practitioner exchanges, as well as the need for platforms for sharing and incubating innovations, for instance, in the aftermath of the global economic crisis when dominant existing paradigms will give way to plurality, experimentation, and forums for open debate. Expanded use of technology (e.g., GDLN) will play a key role. • Focus on the “how� of reform by drawing on practitioner knowledge and by strengthening leadership and consensus-building skills. This also implies enhancing the capacity of non-state actors to participate in and exercise oversight of public processes; as well as facilitating multi-stakeholder dialogues to build consensus and coalitions on reforms.3 • Forging much stronger partnerships both within the Bank and externally. Internally, WBI will work closely with the Regions, Networks, DEC and IFC to leverage WBG knowledge in order to address key capacity constraints in countries, focusing on its core mandate of client learning, knowledge exchange and innovation platforms (box 2). Externally, WBI will expand its partnerships and networks with leading academic, public, and private sector partners, country and regional capacity-building institutions, and peer networks, particularly in partner countries. Going forward, WBI will develop criteria for selection of regional and country partner institutions (e.g., capacity, credibility, regional/local 3 Over the years, WBI has forged successful programs with parliamentarians, civil society organizations, media and the judiciary. Acting as both a knowledge broker and a center for action research, WBI’s parliamentary program has developed a global network that is helping to strengthen the capacity of legislatures to undertake their assigned constitutional roles of oversight, legislation, and representation in more than two dozen countries in Latin America, Africa, Asia and the Pacific. WBI has also engaged with a broad range of civil society organizations over the past ten years. Recently, this engagement has been structured through the DGF-funded Affiliated Networks of Social Accountability, or ANSAs, which strengthen practitioners’ ability to improve government accountability. WBI has helped media associations develop better diagnostic tools and performance indicators (e.g., working with IREX in ECA, MENA, and Africa); helping foster broadcasting policy reforms in countries like Ghana, Nigeria, Liberia, and Timor Leste; and supporting community radio associations in nine other countries. 6 outreach), mechanisms for quality assurance and governance of partnership arrangements and networks, and will explore ways to connect these institutions to funding sources that can help build their capacity. WBI will also seek to enhance partnerships with bilateral and multilateral donor institutions (e.g., UNDP, IMF Institute) on shared programs. • Strategic selectivity, by rationalizing the currently dispersed thematic spread of WBI activities, and focusing on, for example, key corporate priorities or frontier issues that cut across sectors and regions. Box 1. From Retail to Wholesale: WBI’s China Program The China program embodies many aspects of the WBI’s new strategy. All learning and knowledge exchange takes place through partner institutions, some of which have emerged as centers of excellence that are fully equipped to wholesale. An example is the China Health Economics Network that has customized and scaled up delivery of the health flagship course. South-South learning with Africa and elsewhere is led by IPRCC, a Chinese institution set up specifically for this purpose. IPRCC is identifying those aspects of China’s development experience that are most relevant for other countries. In a large decentralized country like China, the GDLN and distance learning technologies feature prominently in the wholesaling process. For example, Western China alone has 12 provincial-level learning centers, and the network will be expanding to include 54 centers at the prefecture level. WBI’s role in China has been to design and deliver strategic retail programs and learning materials that can be used and adapted by selected partner institutions. At the same time, WBI has been delivering courses in learning design and pedagogy to build the capacity of partner institutions such as the Ministry of Finance Training Department, the Asia-Pacific Finance and Development Center, provincial administrative colleges, and others. The program owes its success to sustained country leadership and ownership of the agenda which is fully integrated in the CPS and implemented by a decentralized WBI team in the field. The China program is a mature example of the wholesaling approach. But to reach this level of success in countries with weaker capacity and different sociopolitical environment, WBI will need to take a more incremental approach to strengthening the capacity of regional and national institutions. 7 Box 2: WBI’s Services to the World Bank Group The renewal strategy seeks to integrate WBI more closely with Bank operations. WBI will work closely with the Networks to jointly distill network knowledge and expertise into client learning, knowledge exchange, and innovation platforms, with a view to serving the Regions. This will be primarily in shared areas of strategic priorities between the Networks and WBI where, for instance, WBI can work with the Global Expert Teams (e.g., fragile states, climate change, health systems, public-private partnerships). WBI will leverage and support the work of the Networks by serving as an external connector, fostering external networks of practitioners, experts, and global, regional and country K&L institutions as transmission channels for capacity development. Together they will provide a range of services to support the Regions as follows: • Scale up partner learning, knowledge exchanges, and innovation among practitioners across regions in key thematic areas (including through GDLN and peer networks); • Customize services for different country categories – e.g., modular flagship courses adapted to fragile states or advanced middle-income countries; knowledge exchange among similar types of countries across regions; intensive capacity development support in weaker capacity settings and MIC-OECD knowledge exchange platforms in middle income countries; • Help build networks of K&L institutions in areas of strategic priority, and support country teams in their efforts to build capacity of regional/country institutions; • Provide generalized services – e.g., GDLN, pedagogical support, innovation platforms, multimedia packaging – to support capacity development initiatives; and • Provide advisory and support services that team leaders can draw upon for support in designing and implementing capacity building component of their operations. Strengthening the relationship with DEC is a high priority for WBI given DEC’s role as a generator of knowledge. DEC and WBI will consult systematically and put in place new mechanisms for stronger collaboration. A key element will be a strong partnership between DEC, WBI, Regions, Networks, and IFC on platforms for knowledge exchange and innovation in response to the global economic crisis. There is considerable scope for increased collaboration with IFC, including IFC’s advisory services program.4 VI. Key Business Lines 28. WBI’s new strategic approach will be applied to its three key business lines— structured learning, knowledge exchange, and innovation. The main activities under each business line are summarized below. 29. Structured Learning seeks to help develop skills and address capacity constraints in priority sectors or disciplines. The bulk of WBI activities currently fall in this category. They include courses, workshop, and conferences delivered primarily on a retail basis. The largest reduction will be in this business line as WBI moves to a more wholesale approach. • At the retail level, WBI will focus on the direct delivery of programs in weaker settings. It will also deliver highly selective programs for senior policy makers in global or regional groupings, where face-to-face learning and networking across countries can generate high impact.5 WBI will also develop new flagship courses 4 An example is a flagship program on Inclusive, Ethical and Sustainable Business being developed by WBI with a range of partners, including IFC, SDN, UNDP, UN Global Compact, and the Wharton School of Business. 5 Current examples include the regional seminars for parliamentarians conducted in collaboration with the Commonwealth Parliamentary Association, and joint learning programs for country officials and donors in 8 in key areas of strategic priority (e.g., fragile states, climate change adaptation, and public-private partnerships in infrastructure) and pilot them on a retail basis before scaling them up. In response to demand from external partner consultations, one initiative will be to develop a cross-cutting flagship program on leadership capacity building and consensus building.6 There will also be an expansion of WBI scholarship programs for future leaders. • At the wholesale level, the structured learning business line will expand delivery of flagship courses through country and regional institutes and through the use of learning technologies (e-learning, GDLN, and innovative uses of mobile phones for pedagogy). In close partnership with Regional/Country Teams and IFC, WBI will also expand its work with regional and national institutions to help them become centers of excellence that are fully able to customize and deliver flagship programs, and will develop and make available online learning and open courseware on key topics (box 3). Although WBI will not itself provide core funding or even any significant venture capital in its wholesaling or institutional capacity building, it will facilitate the beneficiary institutions’ efforts to secure needed complementary financing. Where appropriate, this will be done by leveraging the work of Bank and other donor-financed projects.7 WBI will also develop and support certification and accreditation programs for professional associations, and work with regional and national institutions to build the capacity of professionals to meet these standards of practice.8 support of MDG Global initiatives such as the Education Fast Track Initiative and the Global Health Initiative. 6 This will build on WBI’s current in-country Leadership for Results program which works in partnership with Harvard’s Leadership and Development Program, the Rapid Results Institute, and donors such as CIDA, UNDP, and UK-DfID, and has been implemented, for instance, in various fragile and conflict- affected countries. As expressed in the consultations, leadership capacity building will focus on the key dimensions of consensus-building, integrity and accountability to achieve results. 7 WBI is cosponsoring with IEG and the Regions a major new initiative to support four regional centers (one each in Africa, Asia, Latin America, and South Asia) to strengthen the monitoring and evaluation (M&E) capacity of partner countries for results-based management. 8 An example is the Africa Public Finance Management Staff Capacity Development Initiative being piloted in Tanzania, using the qualification framework of the U.K. Chartered Institute of Public Finance and Accountancy and the South Africa Institute of Public Finance and Auditing. 9 Box 3. Structured Learning: Working with Country and Regional Institutions Working in close partnership with the Regions and Networks, WBI already has acquired good experience in leveraging its resources and increasing its impact by working with country and regional institutions. Some ongoing examples, which constitute the foundation for a more systematic, scaled-up approach, include. Instituto Tecnológico y de Estudios Superiores de Monterrey (Tec Monterrey) in Mexico manages a distance-learning university with a network of remote learning sites across Latin America. WBI has worked with Tec Monterrey to deliver e-learning courses on public and private sector related issues for a range of audiences. Foremost has been the training of more than 30,000 municipal managers and local government officials over the past eight years, delivering 100-hour courses that include municipal financial management, urban crime prevention, e-government, anticorruption and corporate governance, among others. The courses address specific challenges facing local governments. The partnership has also produced a web portal that serves as a learning and knowledge exchange platform for municipal officials across Latin America. The Urban Management Certification Program in India. WBI started the first certification program in urban management, initially in partnership with ASCI, a national training institute based in Hyderabad, and subsequently with other state-level training institutes–Yashada in Maharashtra, the Mysore Institute of Urban Development in Karnataka, KILA in Kerala, The City Managers Association in Orissa, and BIPARD in Bihar. The objective is to create a network of centers of excellence on urban management and governance in order to develop a cadre of city managers equipped to govern and provide better services to urban citizens across India. The program is overseen by a National Advisory Committee on Certification chaired by the Ministry of Urban Development and Poverty Alleviation with the participation of state governments. The model is being scaled up nationwide through the national government’s flagship program for urban renewal. WBI’s key contribution to the network institutions has been to support content development, peer review, and pedagogical approaches for using case studies, new learning techniques, and learning technologies to scale up outreach. GIFT-MENA. WBI has established a partnership with the Governance Institutes Forum for Training in the Middle East and North Africa, a regional consortium of 20 training institutes for public administration that creates and disseminates knowledge on public sector governance. The purpose of the partnership is to improve public sector governance across MENA by enhancing the quality of instruction in the member institutes, promoting exchange of trainers, trainees and training programs, and to provide access to custom- tailored curricula in Arabic and French. The Arab Water Academy (AWA) was launched in Abu Dhabi in 2008 as a potential regional center of excellence offering capacity-building programs, peer-to-peer networks and mentoring, and awareness- raising initiatives to improve water management in countries in the Middle East and North Africa. WBI is supporting AWA by enlisting international experts to identify priority learning and development programs for the region. 30. The success of both the wholesale and retail programs depends on developing high- quality branded and certified learning content on priority topics in collaboration with world-class partners, as well as the Regions and Networks. Programs will include components on leadership capacity building and consensus building which will enhance the likelihood of results on the ground. Program offerings will consist of modules that can be customized to address specific country and regional needs (e.g., modules for fragile states or middle-income countries). WBI, which already has experience in developing these kinds of programs (e.g., the Health flagship course—see box 4), will now systematize and scale up the approach. 10 Box 4. Flagship Structured Learning Programs WBI has considerable expertise in developing and delivering structured learning programs. One example is the Flagship Program on Health Sector Reform and Sustainable Financing developed 10 years ago with Harvard University and continually updated since then. More than 18,000 policy makers, managers, implementers, and donor representatives from more than 70 partner countries have completed short-term training events (1 to 3 weeks). The program delivers state-of-the-art content on essential policy levers such as financing, contracting, organization, regulations, and persuasion. The program has drawn on staff from more than 23 universities and research institutions such as Harvard University, York University, McMaster University, the National University of Singapore, Semmelweis University, and the China Health Economics Network. Building on this experience, the Institute will develop state-of-the-art peer reviewed flagship programs in a few core institutional priority areas; and will design and deliver them in collaboration with partners. The content will be modular to allow for country customization. These programs will be delivered through country and regional institutions, and professional certification will be offered to raise the perceived value of capacity development and as an incentive to attract potential candidates (e.g., the Urban Management Certification Program in India). 31. Knowledge exchange. Building on the lessons of the 2004 Shanghai Conference on Scaling Up Poverty Reduction which showcased the considerable potential of South-South learning, this business line will introduce new models for scaling up just-in-time knowledge exchanges, policy debates, and multi-stakeholder dialogues. • At the retail level WBI will facilitate just-in-time exchanges, debates, field visits, and awareness-raising among leaders, practitioners and other stakeholders, on frontier challenges (e.g., climate change adaptation) and in support of the recently created Global Expert Teams (GETs).9 The global dialogues on the economic crisis, the Africa Local Government Action Forum (both using GDLN), and the China-Africa experience-sharing program are recent examples. These models will be scaled up (see box 5). Successful on-demand programs for facilitating multi- stakeholder dialogues to build consensus and coalitions for reforms will be expanded. For example, in Tanzania WBI delivered a multi-stakeholder coalition- building program to curb leakages of HIV/AIDs drugs. • At the wholesale level this entails supporting knowledge exchange through peer networks (such as those with CABRI, ANSA, and the network of Parliamentary Public Accounts Committees; see also box 5) and through networks of regional and country institutions. This could include, for example, multi-stakeholder development dialogues designed and delivered through think tanks in Africa. To promote practitioner networks, WBI will support ongoing knowledge exchange among the participants and alumni of its flagship courses and programs through newsletters, electronic discussions, Web-based libraries, and social networking tools. 9 GETs are a global pool of top experts that will be deployed flexibly to meet demands across countries. 11 Box 5. Knowledge Exchange: Practitioner Networks and South-South Learning Global Dialogues on the Global Economic Crisis When the global economic crisis struck, WBI organized a number of just-in-time global dialogues through GDLN connecting, countries from different regions that are struggling with comparable problems to discuss their policy responses and to exchange their first-hand experiences. Participants discuss subnational financing, subnational government programs, the macroeconomic sector, the financial sector, and the effects of the crisis on the poorest. Future dialogues will include the political economy ramifications of the crisis. Practitioner and Peer Networks are emerging as key pedagogical tools for connecting experts and practitioners worldwide. The Affiliated Networks for Social Accountability (ANSA) in Africa and Asia foster practitioner networks across stakeholder groups to build local capacity for more accountable governance through the application of specific accountability tools. CABRI (Collaborative Africa Budget Reform Initiative) is an Africa-led, and WBI-supported, network of senior budget officers who learn from each others’ experiences in budget reform and public financial management and accountability. Building on its comparative advantage, WBI offers examples of global best practice to the CABRI network. Another example is a proposal to facilitate just-in-time peer learning among the ASEAN countries on social protection dimensions of the global crisis. South-South Learning. WBI supports the South-South Experience Exchange Trust Fund by providing pedagogical advice to help improve the effectiveness of its knowledge-sharing initiatives. Through its leadership in the Global Development Learning Network (GDLN), WBI offers a platform for South-South learning to the entire development community. The Institute also facilitates an innovative, cross-regional, South-South action learning program on eProcurement, in partnership with other Bank units such as PREM, OPCS, GICT, and INT. In the China-Africa experience-sharing program, WBI led a cooperative effort with AFR and EAP to support the Chinese government initiative on South-South learning for Development. Decision-makers from 18 East and Southern African countries compared their own approaches to overcoming challenges to growth and human development with what they saw in China. The program focused on areas where China's experience was most relevant for Africa. WBI also plays a facilitation role with business coalitions to capture and share lessons in fighting HIV/AIDS in the workplace, and with public-private partnerships to combat malnutrition–a program coordinated with the Bank’s Human Development Network and the Global Alliance for Improved Nutrition and supported by the Gates Foundation. In partnership with UNDP, WBI also supports the Global Facility for Disaster Reduction as well as disaster-risk agencies in Nepal, the Philippines, and Ecuador. This is an extensive knowledge-sharing program among developing countries to reduce their vulnerability to natural disasters. MIC-OECD Knowledge Exchange Platform. To address the needs of middle-income countries for cutting- edge knowledge and learning, WBI will foster and support forums for knowledge exchange among MICs on frontier topics (e.g., climate change, performance-based public management, coping with the financial crisis, and growth strategies), also drawing on the experiences of OECD countries. This would build on existing Bank initiatives such as PREM’s Development Policy Forum. Another possibility that emerged from consultations includes WBI’s working with Singapore and AFDC (China) to help them host regular knowledge exchange activities through the GDLN for APEC countries on, for example, the effects of the global crisis on different sectors and policies. The overarching goal would be to develop practitioner networks connecting the MICs and OECD countries to share knowledge, experience, and good practice on the “how� of reform. 32. Innovation. This business line provides platforms for sharing and incubating practitioner-generated innovations to priority development challenges. Although WBI has incubated innovations in the past, these efforts have been sporadic. The mandate now is to take on a new role in systematically providing platforms for innovation, for instance through the Development Marketplace that has recently moved to WBI. The goal is to support, complement and connect excellent initiatives on innovation that the regions and networks have been undertaking, such as the LAC region’s Innovation Fair and ECA 12 Region’s annual celebration of innovation and results, “Improving the Lives of People in ECA.� 33. As the consultations have underscored, the need for innovation platforms will become all the more crucial in the aftermath of the global economic crisis, when established paradigms and lessons embodied in structured learning programs will give way to experimentation with new policies, practices and paradigms, trial and error, and collective learning. These efforts will be coordinated closely with DEC. For instance, the Development Market place could be used to scan for innovative responses to the crisis (e.g., social safety nets) or innovations with respect of upcoming World Development Reports (WDRs).10 34. To help launch this new business line on innovation, WBI hosted a one-day event “Keys to Innovation� on March 4, 2009, convening leading experts and institutions focusing on innovation for development. The aim was to examine the role WBI could play as a catalyst for innovative solutions to development challenges. Participants from outside the WBG provided models for a WBI-based incubation function, and an wide array of WBG participants also helped shape the role WBI could take-on vis-à-vis other Bank initiatives. These consultations suggested that WBI could serve as a provider of innovation services and platforms, internally and externally, that connect practitioner demand with practitioner-generated innovations, and that link innovators to platforms for incubation and mainstreaming. A key priority will be to mainstream innovations in operations or hive off mature innovations.11 Looking forward, participants suggested the following types of services as cornerstones of WBI’s innovation business line: • Soliciting and Screening Services to identify innovations to frontier challenges. These services include franchising the “Development Marketplace� (DM) model to local and international partners and practitioner networks as a means of identifying solutions to frontier challenges (box 6). The activities would shift from the early green-field ideas and seed capital provision to focusing on downstream innovations and a “venture capital� approach that would lead to mainstreaming of innovations into operations. WBI will seek to forge networks with other organizations that provide platforms for innovations (e.g., Asoka and Santa Clara University) to expand the pool from which to solicit innovations and through which to scale up impact. WBI will also seek to connect and share practitioner innovations among peer networks. Inside the World Bank, WBI will seek to revive an internal DM to identify creative programs and products, will offer “Innovation Zones� hosted in real and virtual spaces for Bank staff to “incubate� innovative ideas, including through short secondments under a WBI Fellows program (e.g., on topics such as regulatory reform in the aftermath of the crisis, or promoting inclusive leadership in ethnically fragmented fragile states). 10 The findings from such efforts and WDRs could more systematically feed into subsequent knowledge exchange and structured learning programs (e.g., WDR 2009 on Economic Geography feeding into capacity development programs on urban development). 11 For instance, the lead responsibility for the Worldwide Governance Indicators (WGI) will transfer to DEC as a mature research tool. 13 • Connecting and Capacity Building Services that help innovators and social entrepreneurs access finance and scale-up their projects, for example, through institutional partnerships. • Knowledge Exchange and Dissemination Services, which include short-term clinics and virtual spaces for innovators and other development practitioners to codify their innovations, engage in South-South learning, and disseminate their ideas and findings. These exchanges can be facilitated by technology (e.g., GDLN). Box 6. Innovation: Replicating the Development Marketplace The DM is the World Bank’s competitive grant program that funds innovative early-stage projects with high potential for development impact and replication. Innovative solutions are identified through merit-based competitions organized at the global, regional, and country levels. Since its inception in 1998, the DM has opened a new space for the World Bank to engage directly with grassroots development practitioners and social innovators, and has awarded over US$50 million for more than 1,000 projects. Some 20 percent of the winning projects from DM’s global competitions have been scaled up or replicated in multiple locations, and have yielded significant development outcomes within 3 to 5 years. In recent years, the DM Program has been increasingly mainstreamed into broader World Bank initiatives. For example, last year’s global competition on agricultural innovation reflected the theme of the World Development Report and became a testing ground for innovation in sustainable agriculture; the next global competition will solicit cutting-edge solutions on climate adaptation. VII. Strategic Selectivity 35. As the 2007 WBI assessment and the recent consultations have underscored, activities and themes in all three business lines have to be chosen strategically and selectively. The innovation line will target only a few frontier challenges of highest priority to the institution such as, for example, climate change, and fragility and conflict. Knowledge exchange will focus on those cutting-edge issues that are in greatest demand for just-in-time practitioner-to-practitioner exchanges. The biggest challenge will be to reduce the number of structured learning programs. WBI has been offering as many as 700 learning activities a year under 14 thematic programs and a much larger number of subprograms. The starting point will be to adopt a three-tier strategy. 1) Tier 1: WBI will make a major investment in developing flagship programs in four cross-sectoral thematic areas: o Fragile and Conflict-affected States o Global Economic Crisis o Governance o Climate Change During external and internal consultations these topics were consistently identified as being in high demand by countries and of high institutional priority. In each of these areas, program modules will be developed12 with world-class partners— modules that can be customized for different country needs, and increasingly delivered through regional and national institutions. Programs will be developed in 12 For example, regulatory reform in the aftermath of the global crisis, basic budgeting in fragile and conflict-affected states, governance of extractive industries, and clean fiscal policies. 14 consultation with relevant WBG partners and consist of a mix of structured learning, knowledge sharing and innovation, as appropriate.13 2) Tier 2: Working closely with the Networks and DEC, WBI will make modest investments in developing flagship programs in a few sectoral areas where results can be scaled up through partnerships. For instance, three potential topics highlighted during consultations were health systems, public-private partnerships in infrastructure, and sustainable urban development. 3) Tier 3: The remaining sectoral and thematic programs would be selectively offered on-demand on a cost-recovery basis (or fee-for-service where appropriate), but principally transferred to other parts of the Bank, to e-learning platforms, or to delivery by country and regional institutions. 36. The approach outlined above will be refined during FY10 and rolled out over the subsequent two to three years in a work program where topics change in response to emerging challenges, including through just-in-time or annual reviews. Over the next two to three years, WBI will reduce the number of its sector and thematic programs from 14 to about six or seven. The proportion of face-to-face structured learning activities in the total work program is expected to decline substantially as e-learning, just-in-time practitioner exchanges, and South-South learning increase. 37. Selectivity will also require working with those countries or groups of countries where WBI’s programs can have the greatest impact and demonstration effect, that is, where the enabling environment is conducive, incentives for applying the newly-acquired knowledge are strong, and where staff retention is satisfactory; as well as in those countries where there is an urgent need to enhance the capacity of state and non-state actors in order for economic and social development to succeed (e.g., fragile and conflict- affected countries).14 In both cases, strong country ownership of reforms would be paramount. VIII. WBI’s Anchor Role for Capacity Development 38. The ongoing consultations have indicated that WBI could play an important role as an anchor for capacity-development activities within and outside the Bank. This would suggest that WBI serve as a connector of capacity-development teams and activities across the World Bank Group, with a core mandate of learning and knowledge exchange: a Network Anchor for what is effectively becoming a virtual capacity-development network 13 For instance, in the area of fragile and conflict-affected states, the East Asia and Pacific (EAP) region has requested South-South knowledge exchanges among leaders across regions; and learning programs in political economy, and coalition and consensus-building. In the area of the global crisis, the EAP demand is for just-in-time support to cross-country peer networks. 14 In the Africa region, for instance, beginning in FY10, WBI’s program is proposed to focus progressively on five strategic elements: fragile and conflict-affected states; public and private partnerships in infrastructure; social accountability; wholesale learning and knowledge exchanges through GDLN and regional centers; and anchor-style support from WBI to the region’s Capacity Development and Partnerships group and the sector units. 15 within the Bank. A key objective in this regard will be to support internal and donor partners in meeting the capacity-development commitments made in the 2005 Paris Declaration and 2008 Accra Action Agenda, which focus on the challenges of developing capacity to achieve improved development results. WBI’s emerging priority to partner closely with and support the Africa Region’s Capacity Building and Partnerships group and the East Asia Governance Hub are examples of this role. 39. Key components of this emerging anchor role would include working with internal and external partners to: (i) develop a methodology and pilots for capacity assessments and a framework for monitoring results; (ii) establish a knowledge management and advisory service and a callable roster of international experts as well as a community of practice; (iii) establish a global team that Bank team leaders can draw upon for support in designing and implementing capacity building component of projects; (iv) connect and support networks of global and regional centers of excellence in capacity development work; and (v) help build capacity of local institutions. 40. WBI’s potential role as an anchor for capacity development will require enhanced skills and capacity to fulfill its expanded functions. At this stage, a gradual and incremental sequencing is proposed whereby only highly selective anchor functions are taken on at first over the next 18 months. Specifically, anchor support to the Africa Region’s capacity building and partnership unit, the callable expert roster, pilots of capacity development frameworks in AFR, ECA and MNA, and facilitation of external networks in 2-3 GETs will pursued and lessons assessed before deciding on subsequent steps. On the external front, WBI will focus its efforts on a recently established initiative being pursued jointly with Inwent, UNDP, JICA, ITC-ILO and other partners, including national and regional institutes in the South such as the Administrative Staff College of India and the Africa Capacity Building Foundation, to foster a network of centers of excellence engaged in training and other learning programs for capacity development.15 IX. Focus on Results 41. Measuring the results of learning and capacity-development initiatives is particularly challenging. WBI is determined to meet this challenge, and is developing new and innovative ways of managing for, and measuring, the results of its work. The Institute has developed a new results framework for its capacity-development programs that is being piloted in several countries. The framework will be used to guide capacity assessments and decisions about WBI’s capacity-development programs, including 15 WBI’s participation in global knowledge and learning networks, such as the Learning Network on Capacity Development (LenCD) and the joint donors training network (Train4Dev), will also facilitate knowledge exchange, and promote harmonization and better capacity-development practices within the Bank and with external partners. WBI will remain active in the OECD’s Development Assistance Committee (DAC), encouraging better coordination among the DAC working groups, including GovNet and the Working Party on Aid Effectiveness, which have a major role in the capacity development agenda. WBI is also working with OPCS, UNDP, the Asian Development Bank, and bilateral partners on a learning strategy for the capacity-development and aid effectiveness agenda. 16 defining, capturing, and communicating their results. In its capacity-development anchor function, WBI will also help the rest of the WBG measure the results of capacity- development work more effectively; and a strong results focus will help establish WBI as a center of excellence for capacity development. The elaboration and application of this new framework has been discussed in WBI’s strategy consultations. 42. WBI will use the results framework to map intermediate and final learning outcomes stemming from the activities in its three main business lines. Intermediate learning outcomes refer to the effects of changes that occur at the individual level, including changes in understanding, attitude, knowledge, and skills. The final learning outcomes refer to changes that occur in the interactions among individuals and groups, and thus in the broader organizational or social environment. In particular, WBI will map changes in consensus building, coalitions, and networks, and the formation and implementation of policy and strategy instruments that result from its programs and activities. It will also assess how these learning outcomes contribute to favorable changes in the sociopolitical environment, policies, and organizations, i.e., their impact. Annex 2 outlines the principles underlying the results framework and illustrates its application across the business lines. The framework will be further refined in the coming months and discussed at a forthcoming meeting of CODE in the fall of 2009. 43. Implementation of the results agenda calls for an enhanced internal quality assurance and results-monitoring function that will draw on some of the staff and resources previously dedicated to WBI’s self-evaluation. Reporting on quality at entry, during implementation, and at completion will be substantially revamped, reflecting the need for a continuous feedback loop to ensure adequate flexibility in strategy implementation and to assess the medium-term results of the programs. WBI’s programs will also be subject to the same independent quality assurance and evaluation as the rest of the Bank’s operations. X. Implementation Agenda 44. Completing Consultations and Finalizing the New Strategy. The emerging strategy summarized above, which is the product of an intensive design and consultation process, will be finalized by May 2009 with implementation starting in FY10. Implementation will be the next key priority, and WBI is bringing in a new senior management team to oversee and facilitate swift and high-quality implementation. In view of the very helpful insights generated from extensive consultations, WBI proposes to convene annually key partners, including global development training institutions, other regional and country institutions as well as representatives of the Bank’s Regions, Networks and DEC, to facilitate knowledge exchange on capacity development, and to solicit feedback on the implementation of WBI’s renewal strategy. 45. The FY10 Program and Beyond. The draft FY10-12 work program reflects a shift to investing in new products and partnerships and to reallocating resources away from lower-priority programs. A key priority for FY10 is to invest in a limited number of 17 strategic “flagship programs� that will showcase the renewal strategy. Possible examples include • selected courses (branded and certified core learning programs) prepared with world-class partners and made up of customizable modules, • a limited number of customized country-specific courses to pilot new topics or work in new countries, • a pilot program of support for a small number of regional and country institutions to help them become centers of excellence, • establishment of peer networks in selected thematic areas, • establishment of a South-South and a MIC-OECD exchange business line, and • piloting of new innovation support services and franchising of development marketplace through a few regional centers. 46. Organizational Implications. In recent years substantial budgetary reductions (26 percent since FY04) together with staff attrition (29 percent staff reduction since FY04), has led to a major depletion of WBI management and senior staff (Annex I). Rolling out the strategy will require strengthening and rebalancing the staff skills mix to support the new objectives, themes, and business lines. In addition, some consolidation of units and other organizational changes to promote a culture of teamwork and partnership will be needed. 47. The process of organizational renewal is under way, an entirely new management team is being assembled, and skills in areas of strategic priority are being strengthened. Looking forward, WBI will create teams that come together to work on emerging challenges, and provide quick and responsive services to country partners. More generally, WBI will seek to introduce a flexible staffing strategy, including some joint appointments with DEC, the Networks and Regions to promote better integration with the rest of the Bank; short-term secondments to WBI from the Regions (for incubating innovations or developing flagship programs) and from partner institutions in developing countries; and contracting with world-class experts. 48. Consistent with the feedback from country consultations, and building on its positive experience with recent decentralization programs, WBI will also explore the possibility of expanding its field presence in collaboration with the Regions and external partners. WBI-supported programs in India, China, and South Africa have benefited greatly from having staff on site to manage joint operations and to help mobilize and guide WBI’s HQ-based resources. These staff were jointly appointed and their costs were shared with the Regions. Delivering K&L events and mobilizing resources has also been easier and more effective when working locally with external partners. One model being explored is a regional hub system with the IMF, building on the successful Joint Vienna Institute arrangement for transition economies. Future decisions on decentralization would be guided by the new global Bank model. 49. Financing Implications. The budget implications of the renewal strategy are being developed in consultations with CSR and the Managing Directors. Some transition costs 18 will clearly be incurred in FY10-11. The steady-state level of funding will be determined in an iterative process during this period. 50. Looking ahead, programs will generally be funded through a combination of WBI’s own budget, partner (internal or external) funding, course fees, and donor trust funds. Institutional priorities (e.g., pilot activities in the Tier 1 cross-cutting thematic programs) will be funded from the WBI budget, while activities addressing country partner demands will be funded by the country partner, by the country program budget, by fee-for-service mechanisms where appropriate, or by donor trust funds provided for these purposes. Developing regional and selected country centers of learning will require substantial and reliable funding, and the success of WBI’s efforts in that regard will depend heavily on complementary Bank project and donor financing. WBI will help the beneficiary institutions to secure needed complementary financing. A special effort will also be needed to secure partnerships with donors (including programmatic funding) for the work on fragile and conflict-affected states. 51. Managing the Risks. Change on the scale envisaged in the WBI renewal strategy inevitably poses implementation risks. The major risks and mitigating factors are summarized below. 52. Success of the strategy hinges on establishing much stronger partnerships internally to leverage WBG knowledge and expertise, and externally to build and nurture networks of regional and country K&L institutions. These partnerships represent a significant shift in the way WBI has delivered learning programs in the past, and may be slow in coming to fruition. To mitigate the internal risk, WBI has engaged in extensive internal consultations with Bank Networks, Regions and DEC to agree on priorities and on a way of working together. To successfully scale up external partnerships, WBI will build on the accumulated experience from its successful partnerships (e.g., GIFT-MENA, the India Urban Managers certification program, and the China Health Network). The Institute is also bringing in external managerial expertise with experience in developing such networks. 53. WBI is proposing to make major investments in a few areas (e.g., fragile states, global economic crisis, climate change) that are relatively new areas of focus that also reflect difficult frontiers. While recognizing this risk, WBI proposes to move forward because: (i) these are the most important priorities for capacity development, which a renewed WBI cannot afford to ignore if it is to help improve overall WBG’s effectiveness; and (ii) the proposed WBI areas of focus and portfolio are balanced with a combination of new areas and stable, existing high return areas, e.g., health and urban development. To mitigate the remaining risks, WBI will recruit strong staff with experience in these priority areas, and complement them with leading world experts on short-term assignments; and WBI will forge strong internal and external partnerships to build on accumulated institutional expertise inside and outside the WBG. 54. Capacity building in fragile, conflict-affected and low-income countries constitutes a key priority. However, the capacity of the institutions in these countries is often quite 19 weak, limiting the ability to implement a more wholesale, scaled-up approach. WBI’s renewal strategy explicitly recognizes this as an important reality to be addressed. To mitigate the associated risk, the renewal strategy calls for a multipronged approach: (i) directly delivering priority programs; (ii) working with regional institutions that can help customize and scale up delivery; (iii) using technology (GDLN) and blended approaches (face-to-face and e-learning) to extend reach; and (iv) supporting and connecting internal and external partners to build the capacity of weak country institutions, with a view to leaving longer-term durable assets for capacity development in the country. 55. The success of the strategy will depend on WBI acquiring stronger capacity and providing credible evidence that results are being achieved. The key risk mitigation measure here is strategic selectivity, focusing on the selective priorities outlined above, supported by sufficient resources and managerial attention to ensure achievement of tangible results. The main requirement will be to stay focused, bring in strong expertise on key strategic priorities, and reallocate resources away from low-impact areas. 56. The strategy calls for significant shifts in the way WBI has been doing business, and the required change management exercise could pose challenges in implementation. To mitigate this risk WBI has undertaken a thorough internal and external consultation process to build consensus for renewal. Internally, this has been accomplished through monthly townhalls with staff as well as a variety of team exercises to build the strategy and the work program from the ground up. The external consultations inside and outside the WBG are helping to build broader support so as to sustain the implementation of the strategy in the face of inevitable occasional challenges. 57. In sum, the strategy has been designed with explicit attention to risks and a focus on key mitigation measures. Considerable attention will also be paid to monitoring implementation to ensure that risks are continuously and openly assessed and corrective actions are taken promptly when needed. These risks notwithstanding, the consultations have provided clear feedback that the potential benefits of WBI's renewal strategy for the WBG and the development community are very high, and far outweigh the risks. XI. Questions for the Board • What guidance do the Executive Directors have for WBI in shaping its business lines and thematic focus? • Is the proposed role of capacity-development anchor appropriate for WBI? • Is the proposed wholesale approach of working with regional and country institutions, and with practitioner networks appropriate? 20 ANNEX 1 WBI Budget and Staffing 21 ANNEX 2 A New Results Framework for WBI As an integral part of its renewal strategy, WBI has developed a new framework to ensure a systematic and strategic approach to results in its capacity development work. WBI will use the framework to guide capacity assessments and decisions about its capacity development programs and to manage and measure their results. By applying the framework, WBI aims to improve the strategic relevance of its programs, strengthen country ownership and collaboration, build attention toward more substantive results, and determine what works and what does not in capacity development practice. This strong results focus will help establish WBI as a center of excellence for capacity development through its contribution to learning and improved aid effectiveness. General Principles In the context of WBI’s programs, capacity development is a locally-driven process of learning by leaders, coalitions and other agents of change that brings about sustainable changes in sociopolitical, policy and organizational factors to enhance local ownership, effectiveness and efficiency of efforts to achieve society’s development goals.16 In operation, then, capacity development refers to the design and implementation of transformational learning interventions to bring about locally-owned change to advance particular development goals. Figure 1 clarifies how capacity development services fit in the larger process of development. Figure 1: Overview of Capacity Development Development Goal Capacity Local Ownership, Effectiveness Resources and Efficiency of Resource Use - Financial Capital - Sociopolitical Environment - Infrastructure - Policy Instruments - Technology - Organizational Arrangements - Others endowments Change Lending Economic & Sector Learning Work Other Analytical & Advisory Activities WBI Activities Drawing on the above definition, WBI has designed a new framework to provide a flexible yet rigorous resource that can guide capacity development programs and activities. Figure 2 below summarizes the basic principles of the framework. 16 Learning is defined here as changes in the use of knowledge and information (existing or new) at various levels of society. 22 Figure 2: Basic Principles of the Framework To assess the results of its programs, WBI will first map the learning outcomes stemming from activities in its three business lines. There are two types of learning outcomes. Intermediate learning outcomes refer to the effects of changes that occur at the level of the individual or an intact group of individuals, including changes in understanding, attitude, knowledge, and skills. Final learning outcomes refer to changes that occur in the interactions among individuals and different intact groups, and thus in the broader organizational or social environment. In particular, WBI will map changes in consensus-building, coalitions, and networks, and the formation and implementation of policy and strategy instruments that result from its programs. WBI will also consider how the learning outcomes achieved by its programs impact three key dimensions of capacity or capacity factors; conduciveness of the sociopolitical environment, efficiency of policy instruments, and effectiveness of organizational arrangements in relation to specific development goals: • conduciveness of the sociopolitical environment, e.g. the commitment of leaders, compatibility of social norms and attitudes, and political and social accountability • efficiency of policy and other formal incentive instruments, e.g. their clarity, legitimacy, resistance to corruption and low negative externalities • effectiveness of organizational arrangements, e.g. their operational efficiency, financial viability and stakeholder supportiveness for realizing opportunities. The framework identifies measurable characteristics of these three capacity factors that will be targeted by WBI’s capacity-development programs and reported on periodically during program implementation and at completion. By linking WBI’s learning activities to development goals through learning outcomes and the characteristics of the three capacity factors, the framework offers a change process logic based on building blocks that are amenable to development of indicators and measurement of results. Changes in the characteristics of the capacity dimensions would typically occur before the actual development goal is affected, so focusing on these 23 characteristics generally provides earlier and more easily measured information about the progress of the change process being supported by the capacity development intervention. The results framework is being applied on a pilot basis and/or adapted for application in a range of programs, including WBI’s Regulatory Impact Assessment program in Serbia, Urban Management program in India and Parliamentary Strengthening program in Ghana, the technical assistance programs of the Center for Financial Reporting Reform and the Africa Capacity Building Foundation, and the proposed IBRD Kazakhstan South West Roads project, which has a large capacity-development component and an IDF grant. Illustrative Application to WBI Business Lines The framework will provide a common results platform for all WBI activities. Whether retail or wholesale, WBI’s programs will aim to help societies enhance the conduciveness of sociopolitical environments, efficiency of policy instruments and the effectiveness of organizational arrangements to achieve their development goals. Table 1 below provides examples of possible outcome and impact results for each business line. Table 1: Illustrative Results of WBI Programs Program Program Results Description Outcomes Impacts A global course delivered to senior • Raised awareness of leaders on climate • Enhanced commitment of the leaders to Structured learning level policy makers in the area of change adaptation, meeting development targets for climate Retail climate change adaptation, followed by • Enhanced skills of the leaders to develop change adaptation rapid results support to the country climate change policy • Enhanced clarity and completeness of leaders and teams to develop new • New policy guidance formulated on country level policy instruments in policy instruments climate change adaptation at country level responding to climate change Support to a regional institution to • Improved operational efficiency of the Wholesale • New skills acquired by regional leaders design and use new technology to regional partner as a center of • Improved technical and implementation establish an annual flagship course for excellence for supporting new know-how of the regional partner as a regional leaders from different sectors partnerships between the public and on public-private partnership (PPP) center of excellence private sector • Improved stakeholder participation in • Improved consensus among stakeholders Global dialogue series implemented decision-making on health systems in Knowledge exchange on priority issues in health systems Retail using GDLN on health system fragile states development strengthening in fragile states for • Enhanced transparency and availability • Action network created to support healthcare leaders and key stakeholders of just-in-time information for healthcare leaders in fragile states healthcare leaders in fragile states Support to a regional partner to • Improved the implementation know-how of • Improved effectiveness of the regional Wholesale implement face-to-face and GDLN- the regional partner to build consensus partner to support development targets based knowledge exchange forums to among country level stakeholders and for accountability and good governance mobilize stakeholders at country level create a network of national coalitions to through a regional network of national to form a network of national coalitions respond to development targets for coalitions on accountability and good governance accountability and good governance Regional development marketplaces • Raised awareness on innovative solutions implemented for local organizations to address youth and violence • Local organizations adopted innovative Retail and groups to surface and disseminate • Piloted implementation steps to apply and solutions that helped meet development Innovation new development solutions to address mainstreaming the new solutions into local targets in the area of youth and violence youth and violence development practice Support a private sector coalition to • Private sector coalition engages in • Raised awareness on innovative responses Wholesale establish an annual innovation fair at dialogue with stakeholders on new to tackle HIV/AIDS in the private sector regional and country level as a regular methods for HIV prevention • Implementation know-how of local partner platform to surface and disseminate • The coalition regularly monitors new improved on how to harness new solutions innovative responses to HIV/AIDS in practices and harnesses new solutions to to address HIV/AIDS the private sector address HIV/AIDS issues 24