MANAGING FOR RESULTS

The objectives of USAID's results-oriented management system are simple:

A revamped, results-driven strategic planning process is the centerpiece of USAID's management reforms. USAID's strategic planning now focuses on continuous evaluation and learning at every stage of a project.

The major tool, from which everything else follows, is a careful definition of limited numbers of strategic objectives. Gone are the days of free-standing activities and projects related only by chance to primary objectives of U.S. foreign policy goals. Instead, each operating unit must set forth its overall program goal through a limited number of carefully articulated strategic objectives that identify the most ambitious results that USAID and its partner can achieve. Programs are monitored and evaluated against the achievement of these strategic objectives and an associated set of specific results.

Since 1993, USAID has taken critical steps to improve the results of its development assistance. We have established a clear and understandable set of Agency-wide policies and procedures that emphasize the importance of results in the planning, implementation, monitoring, and evaluation of all USAID development activities.

The following are highlights of the strategic planning process and framework that are now in place:

COUNTRY EXPERIMENTAL LABORATORIES

USAID's Country Experimental Laboratories (CELs) in ten Missions overseas and offices in Washington experimented with reengineered systems before these systems were implemented fully throughout the Agency in October 1995. Reporting by the CELs enabled the rest of the Agency to benefit from their experience.

After a year of experimenting with the Agency's reengineered operations systems and core values, the CELs demonstrated that there is much to be gained by incorporating reengineering concepts. The new programming systems allowed program design time to be reduced by 75 percent. We are seeing improvements in the quality of management and even higher levels of staff commitment to doing things differently, better, and more quickly.

The ten overseas CELs in Niger, Senegal, Mali, Madagascar, Jamaica, Guatemala, the Dominican Republic, the Philippines, Bangladesh and Poland experimented with various ways to implement the core values of reinvention: managing for results, listening to customers, practicing participation and teamwork, empowering employees to make decisions, and ensuring accountability. The CELs demonstrated the benefits that can flow if missions are open to change and choose to take the initiative. CEL reports indicate there has been revitalization and increased enthusiasm by staff for the work they do. The inculcation of the new core values increasingly influences USAID's management practices and those of our partners and government counterparts.

A key issue reported by the CELs was the need for stronger support from USAID's offices in Washington, and need for USAID headquarters to more aggressively undertake its own reengineering. Also reported was the need for a more supportive external environment, e.g., embassies and Congress. Another key issue was the need for staff development, with emphasis on the importance of recognizing and rewarding good performance.

The teams in the CELs also found that:

Every organizational unit within USAID is now proceeding to reengineer and simplify how it works utilizing the ideas and lessons encountered by the Country Experimental Laboratories.

REENGINEERING AND MANAGEMENT REFORMS

USAID is proud of the management reforms that have enhanced its ability to manage for results. These reforms involve both Washington operations and those in field missions. The first management reform was a streamlining of USAID Washington's organizational structure. This change aligned USAID/Washington better with the Agency's sustainable development mission. This reorganization was premised on the need for all bureaus and individuals to work as one agency. The reorganizations consolidated or eliminated four bureaus and 90 organizational units.

Despite these impressive accomplishments, USAID recognizes that it must continually improve the way it does business. This has been an extraordinary year for USAID, as it progresses toward a smaller, reorganized, more effective, and more responsive agency that is equipped for the new and demanding responsibilities it will face in the twenty-first century. As one of only two agency-wide reinvention laboratories for the Vice President's National Performance Review, USAID has been a positive example for the rest of government.

The principal components of USAID's management reform efforts are highlighted below.

Post Closings

In 1994, USAID announced plans to close 21 posts. Since that time, an additional three post closings have been announced. By the end of FY 1996, 23 missions will have been closed and additional posts are to be closed by the end of FY 1997. Given the budget cuts, we expect to continue to assess the viability and costs of other country missions until we have stabilized the relation between resources and programs.

The FY 1996 budget reductions and the prospects for funding now mean that USAID must not only close additional posts, but it also must restructure the overall size of its overseas presence. In this process of repositioning overseas resources, activities will be concentrated in a smaller number of countries -- those that show the greatest promise for producing measurable results and where good partners can help ensure success.

Over the next year, we will develop "graduation" plans for about ten countries. About half of these will "graduate" by the year 2000 and the remainder by 2005. Over and above these graduates are more than 20 countries in Eastern Europe and the Former Soviet Union where we expect that our objective of supporting the democratic and free market transitions will have largely been accomplished by the year 2000.

Those missions which remain -- and the Washington staff which supports them -- will be dramatically changed and we think more effective. FY 1997 will be the year in which we receive the benefits of the major reform efforts undertaken since 1993, with our totally reengineered systems fully on line. We are now moving quickly on the additional post closings as we must capture additional savings in Operating Expenses.

Information Technology -- Tools to Support Operations

In combination with the new approach to operations, a full suite of integrated New Management Systems (NMS) will be employed, comprising both new computer infrastructure and new applications software. These components have been developed as an adjunct to a series of business area analyses (BAAs) through which major areas of operation have been reengineered: accounting, procurement, budget, operations, human resources, property management, communications, and policy guidance (including a completely new automated directives system - ADS).

Taken together, the management system improvements will greatly enhance the ability of USAID employees and senior management to track resources and expenditures and to relate them to results and objectives. Hence, the New Management Systems are key tools in ensuring that there is the maximum return from investments and in helping the Agency work more efficiently.

Teamwork and Customer Service

New operating approaches and better technology by themselves are not sufficient for us to achieve the kind of USAID the nation needs. Thus USAID is not only changing what it does, but how it does it. Consistent with the National Performance Review, major emphasis is being placed on customer service -- on relationships with primary assistance recipients, partners both here and abroad, and suppliers -- augmenting the two agency-wide customer service plans already issued for each of our major bureaus and offices.

Another primary change is reliance whenever possible on team- and task-oriented organizational concepts. To fully employ the skills of its talented workforce, USAID is working to escape the hierarchical rigidities of traditional management approaches.

The new personnel management system embodies new ways of managing human resources. Individual responsibilities and accountability for achieving organizational goals have been clarified, teamwork and appropriate risk-taking are being rewarded, and the knowledge and skills of USAID staff are being developed and expanded to fully utilize each employee's capabilities. This year, USAID has launched a bold experiment whereby, for the first time, it has moved to a single employee evaluation system that is being now in use for both Civil Service and Foreign Service employees. As noted in the experimental laboratory report, linking employee responsibilities to the accomplishment of each unit's strategic objectives is a central objective in the new system.

Procurement Reform

In January of 1994, a memorandum for the executive staff from the USAID Administrator outlined 18 procurement initiatives that were tasked to a newly formed Procurement Reform Unit. These initiatives focused on: transparency and openness with the public; efficiency of systems; automation of systems; recruitment; staffing and training; and establishing more efficient ways of doing business.

This endeavor involved a wide array of development partners and led the Agency to completely reassess its burdensome regulations and outmoded procurement management systems. In the past, there was a lack of consistency in contract and grant formats, terms, conditions, and interpretations. Onerous ad hoc technical and financial reports were often imposed on contractors and recipients. Routine administrative approvals took an inordinate amount of time for processing; contractors and recipients either moved forward without necessary approvals or project implementation was dramatically slowed. A working group identified key problems with a particular system, and then took corrective actions. These included:

In summary, the procurement process has become more efficient and timely, provides wider access to a variety of contractors, increases ethical conduct, and increases economies in USAID procurement activities.

DONOR COOPERATION

In a time of limited budget resources, USAID faces an increasingly complicated set of demands on our development assistance programs as we move to deal with complex emergencies, political and economic transitions, global problems such as environment and disease, and the need to reduce extreme poverty through broad-based, sustainable growth. Recognizing the difficulties of this complex task and the acute need for cooperation with other members of the development community, USAID has embarked on a renewed effort both in the field and at the policy level, to harmonize our efforts with other major bilateral and multilateral donors, NGOs, universities, and private industry to share responsibilities, pool information, share technical expertise, exchange research, explore approaches and conduct long-term planning.

We have sought common definitions of key development problems, agreement on program priorities, operational complementarities in the field, and a more effective division of labor. We have emphasized a clear results orientation and the more effective use of limited donor resources, greater participation and responsibility on the part of the recipient country, and greater attention to the requirements of a transition from relief to sustained development and from a reliance on development assistance to the emergence of self-reliant partners in the international community.

The European Union

USAID is cooperating with the European Union (EU) at the highest level. In September 1995, the USAID Administrator led the U.S. delegation to Brussels to consult with the four Directorates of the European Commission (EC) responsible for economic and humanitarian assistance. The major outcome of these consultations was the creation of a High Level Consultative Group to more closely coordinate assistance plans, program implementation, and conditionality. Five joint working groups have been created: Food Security, Humanitarian Assistance, Health and Population, Civil Society, and Democracy in Latin America.

USAID and the EC have agreed to conduct joint assessments in high-priority regions to determine how to maximize the impact of their combined resources. The first of these, led by the USAID Administrator and the EC Commissioner for Humanitarian Assistance, took place in Rwanda and Burundi in April, 1995. It sent a strong message to donors and actors in the region about the need for improved internal security and resolution of the refugee situation and the difficulty of maintaining assistance in the absence of such arrangements.

USAID and the EU helped to organize a summit of the leaders of the world's ten largest providers of humanitarian assistance in Madrid on December 14, 1995. The summit was launched as a component of the U.S.-European Union "New Trans-Atlantic Agenda" by Presidents Clinton and Santer in Madrid. During this summit, leaders from organizations such as UNHCR, WFP, UNICEF, ECHO, USAID, and PVO umbrella groups discussed issues confronting their programs worldwide and agreed to a comprehensive communique on common objectives and challenges in providing humanitarian assistance.

In addition, the partners are working to harmonize programs in Central and Eastern Europe and the New Independent States -- especially in the area of protecting the environment. USAID is working closely with the EU,as well as the World Bank, with respect to reconstruction work in Bosnia.

The Organization for Economic Cooperation and Development

USAID actively participates in the Organization for Economic Cooperation and Development (OECD) Development Assistance Committee (DAC) on broad policy issues, sectoral and regional questions, and donor program approaches and practices. Working through the DAC, USAID is helping define development approaches, coordinate methods, and strengthen the impact of overall donor efforts. USAID is active in the DAC working groups on Participatory Development and Good Governance; Peace, Conflict and Development; Environment; Evaluation; and Women in Development.

Of particular importance are recent DAC positions that: explicitly recognize the central importance of democracy, human rights, and good governance to sustainable development; stress the need for improved country-level cooperation among donors; and directly address the detrimental role of corruption and bribery in international dealings.

With strong support from the United States, the DAC has nearly completed a policy statement by the donor development ministers (Report of the DAC Reflections Group) which represents an important advance in post-Cold War thinking among donors -- emphasizing increasing global interdependence, a results orientation, identification of the substantial development gains already achieved, and a clear set of targets for focusing donor efforts on the tasks that remain. There is also emphasis on global issues such as the environment, population, and disease.

Japan

USAID's partnership with Japan, the world's largest development donor, strengthens our ability to address global development challenges. USAID has encouraged Japan to broaden the scope of its involvement by increasing its efforts in areas such as environment and health. To date, USAID efforts have helped mobilize nearly $5 billion in new Japanese assistance for development work of concern to the United States.

For example, a successful USAID-Japan effort on children's vaccines in Central Asia became the model for worldwide cooperation on child health. Through the U.S.-Japan Common Agenda on Cooperation in Global Perspective, the partners are now taking action that has brought the World Health Organization's goal of global polio eradication by the year 2000 within reach.

THE NEW PARTNERSHIPS INITIATIVE

Responding to Vice President Gore's announcement at the 1995 UN World Summit for Social Development, USAID has worked with a broad array of development partners to design and pilot the New Partnerships Initiative (NPI). The design phase of NPI directly involved over 120 USAID employees and development partners--USAID field and headquarters staff, U.S.-based and local PVOs and NGOs, municipal associations, cooperatives, the business community, foundations, universities and community colleges, think tanks, and other bilateral and multilateral donors. This was accompanied by an intensive outreach effort with both the development community and the general public.

The central idea behind NPI--that development can be energized by linking local business, indigenous NGOs and local governments, while also ensuring a supportive policy, regulatory, and resource environment at the national level--reflects a greater understanding of the forces of change embedded at the roots of society. Local community involvement and effective partnerships between the public and private sectors are key to breaking the cycle of long-term dependence on external support and to fostering the ability of local groups and national governments to engage one another as full partners in the development process.

NPI will build on Agency efforts to ameliorate poverty, by ensuring that countries have the capacity to sustain their own growth and become full partners in the global community of free markets and open societies. Itwill encourage our U.S.-based development partners and other donors to pursue results-based programming which leaves host countries with the capacity to advance their own development programs.

To facilitate the process of Agency-wide implementation, seven pilot countries are leading an intensive learning phase designed to test these approaches and identify promising practices. Working closely with a team including USAID personnel from Washington and the field, a broad array of nongovernmental partners, other donors and host country officials, these "NPI Leading Edge Missions" in Bangladesh, Guinea, Haiti, Kenya, Philippines, Sri Lanka and Zambia will develop new ways to build linkages among groups at the local level, forge solid society-to-society linkages between these local groups and their U.S. counterparts, and contribute to both capacity building at the grassroots level and a healthy national policy environment. Other field missions will take part in this process as "NPI Partner Missions," participating in an electronic discussion group and contributing operational suggestions based on their own best practices. This NPI learning phase will culminate in Agency- wide policy and implementation guidance that missions will use in the budget and program process.

LESSONS WITHOUT BORDERS

USAID recognizes the long-term challenge of building public support for foreign aid. Lessons Without Borders is a nationwide effort to share with American communities some of the knowledge that has been developed through U.S. assistance overseas. This program demonstrates not only that foreign aid works, but that Americans can benefit directly from the skills and experience gained overseas by USAID. USAID employees are sharing their hard-won expertise with their fellow citizens.

USAID is particularly well situated to help deal with the problems encountered in some of America's poorest neighborhoods:

In June 1994, Vice President Al Gore launched the inaugural Lessons Without Borders conference in Baltimore with more than 200 people who gathered to find ways to improve health services and foster smallbusiness in the city of Baltimore. The response was overwhelming. Requests to host future conferences flooded in from mayors around the country. USAID responded by hosting two other conferences in Boston and Seattle and has now entered into a partnership with Washington, D.C. to assist a public housing community in its effort to restore health services to its residents.

Lessons Without Borders has demonstrated that successful approaches, whether in rich nations or poor, have much in common. Whether the issue has been microenterprise, child nutrition, the environment or immunization, the key to success in each of these programs has been:

These approaches produce programs that are more effective and sustainable.

Plans currently are underway for a national Lessons Without Borders conference, again sponsored by Mayor Schmoke, in Baltimore; a program in late summer in Newark, New Jersey; and a program in rural Georgia sponsored by the Carter Center. Nearly a dozen other mayors and elected officials have expressed an interest in hosting programs in their communities.