International Development: A Casebook for Effective Management

International

Development

A Casebook for

Effective Management

Frederick Keenan and Christine Gilmore

iUniverse, Inc.

New York Bloomington

InternationalDevelopment

A Casebook forEffective Management

Copyright © 2011 by Frederick Keenan and Christine Gilmore

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ISBN: 978-1-4502-5526-4 (sc)

ISBN: 978-1-4502-5527-1 (ebook)

Library of Congress Control Number: 2010916423

Printed in the United States of America

iUniverse rev. date: 01/06/2011

 NOTE TO INSTRUCTORS

There is an Instructor’s Manual to accompany this textbook, which is available to lecturers who have prescribed this textbook in their courses. The Instructor’s Manual contains detailed and comprehensive teaching notes for all of the cases in the book.

Case teaching notes typically contain most or all of the following:

• learning objectives of the case

• suggestions for identifying, and dealing with, the issues

• suggested strategies for teaching the case

• sources of additional relevant information, including downloadable slide shows

• student assignments

• detailed answers to the assignments

• an analysis of the decision process

• follow-up cases with their teaching notes.

Course instructors are invited to contact Dr. Frederick Keenan at [email protected] to obtain a copy of the Instructor’s Manual.

Contents

Chapter One

EFFECTIVE DECISION MAKING IN INTERNATIONAL DEVELOPMENT: THE CASE METHOD

Chapter Two

THE NATURE OF INTERNATIONAL DEVELOPMENT: OBJECTIVES, NEEDS, PRIORITIES, AND FASHIONS

Chapter Three

SUCCESSFUL DEVELOPMENT PROJECTS:

WHAT WORKS AND WHAT DOESN’T

Chapter Four

INTERNATIONAL DEVELOPMENT: WHAT CANADIANS DO

Chapter Five

FUNDING FOR DEVELOPMENT

Chapter Six

THE PROJECT CREATION PROCESS AND RESULTS-BASED MANAGEMENT

Chapter Seven

CASES IN INTERNATIONAL DEVELOPMENT

Chapter Eight

GETTING PROJECTS STARTED PROPERLY

Chapter Nine

NONGOVERNMENTAL ORGANIZATIONS

Chapter Ten

SMALL ENTERPRISES

Chapter Eleven

THE CANADIAN PRIVATE SECTOR

Chapter Twelve

ENGINEERING AND INTERNATIONAL DEVELOPMENT

Chapter Thirteen

RESEARCH IN INTERNATIONAL DEVELOPMENT

Chapter Fourteen

INTERNATIONAL EDUCATION AND STUDENT EXCHANGES

Chapter Fifteen

MONITORING AND EVALUATION

Chapter Sixteen

HOW TO GET STARTED IN INTERNATIONAL WORK

Chapter Seventeen

PREPARING YOURSELF FOR INTERNATIONAL ASSIGNMENTS

ACKNOWLEDGEMENTS

ABOUT THE AUTHORS

ACRONYMS AND ABBREVIATIONS

NOTES

Chapter One

EFFECTIVE DECISION MAKING IN INTERNATIONAL DEVELOPMENT: THE CASE METHOD

One of the greatest pleasures obtained from working in international development is watching highly effective managers, Westerners as well as our partners in other countries, as they repeatedly make good things happen. These individuals are quite a disparate lot. They could be academics or students, they might belong to international or indigenous NGOs, they might work for associations of educational institutions, they may be community leaders or trainers in developing countries, they can be found working for government or bilateral or multilateral agencies at home and abroad, they might be businesspersons or consultants, they could be enthusiastic volunteers meeting around a kitchen table.

Although many of the individuals who do international work are very good at the business of managing development activities, there are too many—unfortunately—who are less effective, resulting in a poor use of scarce resources, and in disillusionment and chagrin on the part of their partners.

What nurtures the ability of solid international development decision making? In striving to answer this, the authors spent considerable time over the past three decades observing effective managers of international cooperation projects, and trying to determine what it was that they had in common. For example, was it the kind of academic training they had; was it their religious, ethical, family or community backgrounds; was it the types of projects and the countries they had their early formative experiences in?

The conclusion we came to was that, although all of the above influences can contribute to preparing someone for productive international work, the most dominant widely shared characteristic of effective managers is the thought processes they use, either deliberately or intuitively, for the following:

1. to accumulate and organize the available information

2. to establish various potential alternative courses of action

3. to set criteria for evaluating the various alternatives

4. to make the decision

5. to formulate plans for implementing the decision reached

6. to establish a system for monitoring and evaluating the results of the work, and

7. to convincingly explain and defend the decision and the implementation plans to their peers.

In many cases, moreover, they do all of this in the context of incomplete, irrelevant or contradictory information being available!

Because we are often asked to teach, to counsel, and to evaluate international management, we have struggled with how to cultivate this kind of thought process. Even though there are lots of tools and information, and countless opinions, nevertheless there are no answers in the back of the book in international work. We eventually came to appreciate that one of the most powerful tools for developing the ability to make good decisions in the face of incomplete information was the case method as used, for example, by the Harvard Business School in the US and the Richard Ivey School of Business in Canada¹, and (in different forms) in certain medical and engineering schools.

A case is a description of an actual situation (a problem, a decision, an opportunity, a challenge, a dilemma) that a real individual in a real organization has recently been confronted with. Readers are invited to put themselves in the shoes of the decision maker to evaluate the information that was available to the decision maker at that moment in time, and with a time frame in which to make a decision. The available information may be relevant or irrelevant, and is often incomplete. Students go though the seven-step process described three paragraphs above. They then present, and defend, their decisions to groups of their peers. This process is fundamental to the case method and will be used repeatedly in the book, starting in Chapter Seven where the first full case will be encountered.

When we say that students are invited to put themselves in the shoes of the decision maker, this means that the same incomplete information is placed in front of the students as the decision maker had available at the time of the case, and that the students are challenged to make and justify the most effective decision to be made in the circumstances of the case, just as the original decision maker had been. (This is not the same as trying to be in the mind, rather than the shoes, of the decision maker because that is just not possible.)

The teaching philosophy behind the case method is that the best way of learning how to make good decisions is to be confronted every day with a wide range of complex decisions that need to be made and defended. Students in the highly rated Ivey School, for example, regularly face up to three cases per day during their education. One learns to be an effective decision maker by repeatedly going through the processes required for making tough decisions, and successfully arguing those decisions in front of peers. The evident abundant success of Harvard and Ivey in preparing professionals as decision makers in a wide variety of organizations is a testament to the utility of the case method.

This then is what the book is all about. In partnership with your course instructors, we will provide you with a solid introduction to all the elements of international development, and then sharpen your abilities as effective decision makers by taking you through a wide range of decisions that real development managers were actually faced with.

In the use of the case method in a teaching and learning environment, students use casebooks, which are textbooks in which a large number of cases are interspersed with the instructional material. We have written this book as a casebook. The cases contained in this casebook are all real², and the individuals described have given written permission to use their situations in classrooms. The cases are of different types of decisions in a wide range of countries, and are of differing levels of complexity and difficulty. Cases are included to give students, under the guidance of their instructors, the opportunity to work a situation all the way through to a decision.

In addition to cases, we make extensive use of case analyses. Case analyses are used to describe development situations (again, real and recent ones), the decisions that were actually made, and the actions taken. Case analyses are presented to illustrate the thought processes that various managers went though in reaching decisions and how they implemented the decisions. Students are welcome to second guess the decisions that were made, and possibly to improve upon them.

The decisions in the cases were made using both individual and collective approaches. In some cases, it was an individual who struggled with choices. In other cases, there was a striving for consensus by a group of Westerners and their partners in other countries.

Here are the opening paragraphs of four of the cases contained in this book. We invite you to put yourself in the shoes of the four managers who are the focal points of these cases. Now, what are you going to do? What possible activities can you imagine doing? Out of all these possible activities, which ones will be the most effective? How will you determine if and when they are effective? What information will you seek to help you make your decisions? What development concepts and principles apply here? Are there other professional disciplines that you will you need to draw from? How much money will you need? Where will the money come from, and how will you convince the funding agency to support you? What time scale is appropriate? Will your decisions bring about an efficient use of human and financial resources? How will you select your partners in the other countries? How do you plan to respect the knowledge, experience and aspirations of your partners? Whom, specifically, are you trying to help? Will you achieve sustainability, and gender equality and empowerment? How will you defend your decisions to groups of your peers? Will you really make a difference to someone’s life, or are you just engaging in tourism?

• Case: Ghana & Don Sawyer

The new Ghanaian leader stomped out of the meeting at one point with no indication of when, or even if, he would return. Sawyer’s colleague turned to him and said, Don, I don’t think we can work with these guys. I think we should just leave. Sawyer had to decide, and quickly, what to do.

• Case: Peru & Andrew Nelson

On May 6, 2002 Andrew Nelson, an Associate Professor of Anthropology, had just returned from a trip to Peru where he wanted to establish a museum of cultural history and an accompanying international bioarchaeological research center. Nelson had successfully gathered all the necessary information and arranged all the required legal agreements while in Peru, and he turned now to fundraising. Nelson understood that, when he approached the private sector for funding, a proper business plan for this venture would be required. Never having previously been involved with such documents, Nelson set out to inform himself about business plans and to prepare one for the Peruvian museum within the next few months.

• Case: CESO & Gordon Cummings

During the first week of September 2003, Gordon Cummings, President & CEO of the Canadian Executive Service Organization (CESO) was busy in CESO’s Operations Centre in Toronto preparing for a meeting of the Executive Committee of his Board of Directors, which was going to be held on September 27, 2003. He knew that the CESO organization was at a crossroads: CESO could either choose to continue operating as it had for more than three decades, which would probably please most of its staff and its roster of over 3000 volunteers, or it could undergo fundamental strategic changes in order to follow the new directions urged upon it by the Canadian International Development Agency (CIDA), the major funder of its international activities.

• Case: Ethiopia & Christine Gilmore

On September 7, 1993, Christine Gilmore, the Administrator of an NGO called Future Forests, Partners in African Community Development, had just returned from the annual monitoring trip to their project in northern Ethiopia. She was starting to write a proposal to be submitted to the Board of Directors of Future Forests for the next phase of the project, and she was faced with making fundamental changes to the project in response to the wishes of the Ethiopian villagers.

Again, these are all real, and fairly recent, situations. Sawyer, Nelson, Cummings and Gilmore have all given written permission to use their experiences in this book and in courses that use this book.

Each of the cases in the book continues beyond the opening paragraph to provide the reader with the information that was available to the decision maker at the moment of the case. The information may be relevant or irrelevant, and is usually incomplete. The reader is then challenged as to what to do, and how to do it.

In addition to cases and case analyses, we include a large number of brief illustrative examples of actual activities that were useful in development projects in working towards intended results. There are also three conversations between Keenan and individuals who possess valuable insights that can be helpfully used in international development cooperation.

Cases don’t start appearing in this book until Chapter Seven (some examples extracted from the cases appear as early as Chapter Three). Before then, we will introduce you to the concepts, principles and information that you will want to have at hand when tackling the cases.

This brings us to the structure of the book. In Chapter Two, we discuss the nature of international development cooperation—what it is, who does it, what are the needs and priorities of our partners in other countries, the fashions in international assistance over the years. Chapter Three (the longest chapter) explains what works in successful international development projects, and what doesn’t work. What Canadians do in international development—the kinds of contributions Canadians are making-are in Chapter Four. Chapter Five explores where the money comes from to pay for these projects and programs, and what are the priorities and requirements of the funding agencies. Using this basic information, in Chapter Six we then go through the process of creating good projects, paying particular attention to the discipline provided by Results-based Management.

In Chapter Seven we start inserting cases, and we continue to provide new cases and case analyses throughout the remainder of the book. At the same time we introduce much more information of potential value to the reader, such as how to get projects properly started, establishing and managing NGOs, private sector development, business plans, international consulting and contracting, corruption and challenges to integrity, monitoring and evaluation, successful exchange programs, security and health hazards, how individuals get started in international development work, preparing yourself and your family for an overseas assignment, problems of re-entry to Canada, the role of research in development, some protocol advice on courtesies and taboos, and much more.

We have been asked who would benefit from using this book and by participating in courses based on this book. In general, we have written this book for the women and men at home and in our partner countries who are called upon to make international development decisions, as to what to do, and how to do it. These people include, for example, university and college undergraduate and graduate students in arts, social sciences, engineering, agriculture, and information sciences who are taking courses in international development, students of international business, senior university and college officials responsible for the internationalization of their institutions, university and college administrators responsible for international activities such as student exchanges, study abroad, preparation of project proposals and management of projects, employees of government departments and agencies involved in international cooperation, employees and volunteers of NGOs, private sector involved in international business and consulting, the general public and media interested in effective international development, as well as our partners and counterparts in other countries.

The book is intended to prepare the reader, first, to be an effective practitioner of international development cooperation, and also to be an effective manager. One successful academic model for achieving this is to use this book as the textbook for third year and fourth year courses in international development that contain a summer internship in a developing country between third and fourth years. The third year course prepares students to be practitioners; the fourth year course (enriched by the students’ summer experiences) enhances their skills as managers.

Finally, as a note from the authors to the reader who is considering devoting all, or a portion, of her or his life to international development: there are an enormous number of truly important things for you to do, and you will find it fundamentally satisfying when you help to improve the quality of life in a community. It is our goal with this book to develop and sharpen your knowledge and your decision making skills so that you will do effectively whatever it is you choose to do with your life in international development.

Chapter Two

THE NATURE OF INTERNATIONAL DEVELOPMENT: OBJECTIVES, NEEDS, PRIORITIES, AND FASHIONS

In its simplest terms, international development is sustainable improvement in the quality of life, especially for those in the world most in need. Working in international development is an attempt to make the world a better place.

That was the easy part. Now the questions get tough. What does one mean by the quality of life? What needs to be done to bring about an improvement in the quality of life? How will you know when (or even if) you have made such an improvement? How does one make the improvement sustainable? Why do it, i.e. why does it matter? Who can do it? Who should do it? How can we best work together with our partners in other countries—what are their aspirations, experiences and capabilities? How does one go about doing it? What does it cost? How should the work be organized? What countries should be targeted for improvements? Which sectors of society should be helped? How do the concepts of fairness and gender equity come into play?

Moreover, how does one, in the context of chronically inadequate resources for foreign aid and development, make choices as to whom to help and what to do? What should we do first? How does a country that provides international assistance make resource allocations among emergency aid, post-disaster reconstruction, development cooperation, and debt relief? What training should one receive to do work of this kind? What personal characteristics are needed for doing development work?

Human Development Index

First, with respect to the quality of life, one place to start assessing this rather vague concept is the Human Development Index (HDI), listings of which for individual countries are found in the annual Human Development Reports of the United Nations Development Programme:

The Human Development Report (HDR) was first launched in 1990 with the single goal of putting people back at the center of the development process in terms of economic debate, policy and advocacy.3

The HDRs were created under the leadership of Pakistani economist and finance minister Mahbub ul Haq, whom we quote here:

The basic purpose of development is to enlarge people’s choices. In principle, these choices can be infinite and can change over time. People often value achievements that do not show up at all, or not immediately, in income or growth figures: greater access to knowledge, better nutrition and health services, more secure livelihoods, security against crime and physical violence, satisfying leisure hours, political and cultural freedoms and sense of participation in community activities. The objective of development is to create an enabling environment for people to enjoy long, healthy and creative lives.4

The Human Development Index is based on four indicators:

• life expectancy at birth

• adult literacy rate

• enrollment in primary, secondary and tertiary schools, and

• GDP per capita.

In the 2004 HDR, HDI values were given for 177 counties. The top ten (in descending order) were Norway, Sweden, Australia, Canada, Netherlands, Belgium, Iceland, USA, Japan and Ireland. The bottom ten were Chad, Democratic Republic of the Congo, Central African Republic, Ethiopia, Mozambique, Guinea-Bissau, Burundi, Mali, Burkina Faso, Niger and Sierra Leone. The bottom ten are all in Africa. In fact, all but four of the bottom 37 countries are in Africa.⁵

For the top ten countries, the median HDI value was 0.94; for the bottom ten, it was 0.35. To understand what this means in human terms, one can compare a country in the midst of the top ten, for example Canada, with one in the bottom ten, say Burundi: at birth a Canadian can expect to live to the age of 79, but a newborn Burundian can only expect to reach, with some luck, the age of 41. Most adult Canadians are literate, but only half of Burundi’s adults can read and write. GDP per capita in Canada is US$29,480; in Burundi, it is US$630.

An excellent presentation of this information is a wall-size map of the world produced by Canadian Geographic magazine and the Canadian International Development Agency (CIDA)⁶. Entitled A Developing World, it displays the HDI data for all countries. For each country, data are given for:

• surface area

• population

• life expectancy at birth, women/men

• net primary school enrolment rate, women/men

• Gross Domestic Product (GDP) per capita in US$ Purchasing Power Parity (PPP)⁷

On the map, each country is color-coded to indicate whether its HDI is high (yellow), medium (orange), or low (red). Yellow is the color of, for example, North America, Western and Central Europe, the Southern Cone of South America (Argentina, Chile, Uruguay), Japan, Australia, New Zealand, and Brunei. Red is seen almost exclusively in Africa.

Millennium Development Goals

In response to the terrible inequities revealed by the wide range in the values of the Human Development Index, in 2000 all 191 member countries of the United Nations met and pledged themselves to meet the following eight Millennium Development Goals (and the corresponding targets for each MDG) by the year 2015:

Eradicate extreme poverty and hunger.

• Reduce by half the proportion of people living on less than a dollar a day.

• Reduce by half the proportion of people who suffer from hunger.

Achieve universal primary education.

• Ensure that all boys and girls complete a full course of primary schooling.

Promote gender equality and empower women.

• Eliminate gender disparity in primary and secondary education preferably by 2005, and at all levels by 2015.

Reduce child mortality.

• Reduce by two thirds the mortality rate among children under five.

Improve maternal health.

• Reduce by three quarters the maternal mortality ratio.

Combat HIV/AIDS, malaria and other diseases.

• Halt and begin to reverse the spread of HIV/AIDS.

• Halt and begin to reverse the incidence of malaria and other major diseases.

Ensure environmental sustainability.

• Integrate the principles of sustainable development into country policies and programs; reverse loss of environmental resources.

• Reduce by half the proportion of people without sustainable access to safe drinking water.

• Achieve significant improvement in lives of at least 100 million slum dwellers, by 2020.

Develop a global partnership for development.

• Develop further an open trading and financial system that is rule-based, predictable and non-discriminatory.

• Include a commitment to good governance, development and poverty reduction—nationally and internationally.

• Address the least developed countries’ special needs. This includes tariff- and quota-free access for their exports; enhanced debt relief for heavily indebted poor countries; cancellation of official bilateral debt; and more generous official development assistance for countries committed to poverty reduction.

• Address the special needs of landlocked and small island developing states.

• Deal comprehensively with developing countries’ debt problems through national and international measures to make debt sustainable in the long term.

• In cooperation with the developing countries, develop decent and productive work for youth.

• In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries.

• In cooperation with the private sector, make available the benefits of new technologies—especially information and communication technologies.⁸

The United Nations Development Programme (UNDP), as the UN’s global development network, links and coordinates global and national efforts to reach the Millennium Goals. Then-UN Secretary-General Kofi Annan asked UNDP Administrator Mark Malloch Brown, in his capacity as chair of the UN Development Group, to be the coordinator of the Millennium Development Goals in the UN system—to make them an integral part of the UN’s work worldwide. UNDP does so by integrating the MDGs into all aspects of the UN system’s work at the country level. For more than 70 of the poorest countries, the main strategic tool is a nationally-owned poverty reduction strategy paper, which relates to national budgets, development activities and other assistance frameworks. National poverty reduction strategies are discussed a few paragraphs below.

The Millennium Project was commissioned by the United Nations Secretary-General in 2002 to develop a concrete action plan for the world to achieve the Millennium Development Goals. In 2005, the independent advisory body headed by Professor Jeffrey Sachs presented its final recommendations to the Secretary-General in a synthesis volume Investing in Development: A Practical Plan to Achieve the Millennium Development Goals.⁹

The World Bank evaluated in 2004 the progress being made towards meeting the MDGs and concluded, disappointingly:

…if current trends in growth and poverty reduction continue, the goal for eradicating extreme income poverty is within reach. But it may well be the only goal to be attained, for many of the other non-income goals–such as universal primary education, promoting gender equality and reducing child mortality–current rates of progress are too slow.10

National Poverty Reduction Strategy Papers11

With respect to the first Millennium Development Goal above, Eradicate extreme poverty and hunger, developing countries have been urged by the World Bank (WB) and the International Monetary Fund (IMF) to create and implement national poverty reduction strategies. Poverty Reduction Strategy Papers (PRSPs) describe a country’s macroeconomic, structural and social policies and programs to promote growth and reduce poverty, as well as associated external financing needs. PRSPs are prepared by governments through a participatory process involving civil society and development partners, including the WB and the IMF.

As of February 28, 2005 some 44 developing countries had prepared their national PRSPs and 10 more were in the process of doing so. The PRSP for each country is located on the IMF’s web site.¹²

According to the World Bank,

For the most part…PRSPs to date have focused on economic and structural policies to achieve higher growth rates and on social sector investments. Documents have also highlighted the importance of transparency, accountability, good governance, and empowerment of the poor in this process…Ideally, a country-owned poverty reduction strategy will enjoy the support of all of a country’s development partners, and will provide a common framework for their assistance programs in the country…Many governments have begun to use the PRSP process as a means to improve aid coordination.

Because it is important that donor countries not trip over or duplicate each other while working in a particular developing country, agency coordination is one of the basic principles to be followed in the project creation process. The national PRSPs are one of the more useful documents to be carefully considered in ensuring complementarity of assistance efforts.

With respect to the large multilaterals we have been mentioning such as the UN, UNDP, WB, and IMF, explanations of who and what they are, and of their funding programs in support of international development that the reader can tap into, are presented in Chapter Five. Canada’s own international assistance agencies are first introduced in Chapters Three and Four, and their funding programs are described in Chapter Five.

Funds devoted to foreign aid

By now, the reader has an idea of the enormously wide range of what needs to be done in order to bring about (in the words we used at the beginning of this chapter) sustainable improvement in the quality of life, especially for those in the world most in need. This is going to be costly. How much is the world—and how much is Canada-prepared to spend on international development?

In the fiscal year 2005-2006, Canada spent $3.7 billion on international aid.¹³ A UN commission led by former Canadian Prime Minister Lester Pearson proposed, in 1970, a target of 0.7% of GDP as the amount of money to be devoted to foreign aid by rich nations. According to the Globe and Mail¹⁴, in 2005 (four decades later) Canada was contributing only 0.28%. At that time, Just five rich countries devote 0.7 per cent of GDP or more to foreign aid: Denmark, Norway, Sweden, the Netherlands and Luxembourg.

Fashions in international development

Let’s spend a few minutes to take a glimpse at how those in the development business actually go about their work. For this, we are going to turn to the writings of Jack Westoby. Westoby was an almost legendary economist and statistician who retired in 1974 from the Forestry Department of the Food and Agriculture Organization of the United Nations (FAO) after 22 years of distinguished, and occasionally controversial, service. During this time, he was one of the leading thinkers struggling with the questions of how forests can be used to serve mankind and, more generally, how the process of development takes place. At one point he wryly observed that, in order to make a contribution to international development, it was necessary to lose one’s illusions while keeping one’s faith.¹⁵

In 1978, Westoby looked back on the thirty or so years since the end of the Second World War (when modern global development efforts had their start) and reviewed, humorously but somewhat ruefully, the many changes in the fashions in development thinking over that time:

In the late 1940s, it was assumed that countries that were less developed were that way because they were late starters. They were further behind