Do donors need more (and better) Contract Managers to deliver results?

I frequently come across people who say that donors are under increasing pressure to spend more with fewer staff. This usually comes from friends and colleagues that work with donor agencies, or those that interact closely with them. This is supposed to be largely a consequence of pressure from domestic tax-payers, who have refused to continue to fund bloated aid bureaucracies.

This directly impacts how donors approach the ‘results agenda’. The ‘results agenda’ implies an expectation from donor agencies that they record and report results that their funds are able to achieve. The focus therefore is on outputs and outcomes, as well as the cost at which these were achieved, and on demonstrating how they compare against context-relevant benchmarks. For donors, this means selecting the right implementing partners, and holding them to account for the delivery of cost-effective results.

But this also means rethinking how donor agencies themselves are run. An important question that donors face is regarding the staff composition in their offices (especially the country offices). Should there be more Programme Managers or Contract Managers? The easy answer of course is to say, “we need both”. But what should be the balance of power between the two? In this post, I acknowledge this is a genuine dilemma, but deliberately argue for the latter.

One of my main points in a previous post was that to navigate the results agenda donors need to invest in their staff.

Donors that adopt the ‘results agenda’ (or the value for money agenda, for that matter) need to invest time and resources to ensure their staff fully understand the implications of this agenda, the mechanisms through which it is to be implemented, and most importantly, its limitations. It is possibly redundant to state that ‘context matters’, but it really does. As donors continue to trim down staff, it places greater emphasis on their ability to manage projects and contracts with implementers in ways that are accountable, and yet retain the flexibility necessary for development work

Again, this will not be possible without a mix of technically competent staff who are also adept at administering programmes. My observation is that in an environment where donors design and then contract out programmes, it is crucial that they possess a battery of effective contract managers.

I should clarify what I mean by contract managers. One, I refer to contracts in a general sense – all grants are bound by contracts; so are all service providers. I refer specifically to programmes, and not to service vendors. Second, those managing these contracts are essentially those that are currently called desk officers, advisers, programme officers, or something similar. What I am arguing in this post is that these people need to be more adept at contract management – and if pushed, I am arguing the side that their ability to draw up and manage contracts (of which commercial acumen is a part) needs strengthening. Here are two reasons why:

  • Prominent donor agencies these days are not short of programme funds. Significant sums of money need to be “programmed”, and in its most elementary form, this could be understood as signing and managing contracts worth the size of your annual budget. Given that donors rely on grantees and contractors to deliver projects, the ability to run competitive procurement processes, and manage tight contracts is critical. Moreover, corporate support services of finance and administration are also under considerable strain in many agencies.
  • In the areas of service delivery, advocacy or research, leading experts are increasingly to be found not within donor agencies, but in implementing agencies, service providers, think-tanks or research institutes. Donors contract these specialists as required, using a variety of contractual modalities. As more and more technical work is delegated to external agencies, donor staff are required to focus on effective contract management. This naturally reduces the extent of technical resources required in country offices.

All the same, it is important to consider the issue of staff motivation. When development professionals land jobs in big multilateral or bilateral agencies, how do they see their own role? Do they see their role as being efficient administrators of programmes, or are they keen to make a personal impact on the design and execution of programmes they manage? If it is the latter, staff would want to focus on programmes, and try to leave the bulk of the administration to somebody else – which wouldn’t quite work in the scenario that I describe above. One would have to navigate this carefully, creating alternate ways to boost staff morale. Ultimately, this ties into developing a shared organisational vision, mission and work-culture.

On balance, there would seem to be a pretty strong argument for donors to invest in more (and better) Contract Managers. I by no means fit the profile of a contract manager, or an administrator – so I can already hear a chorus of voices loudly protesting this suggestion. As I said earlier – it’s probably true that we need both contract managers and programme managers, but perhaps, the balance of power should tilt towards the former. The retinue of technical experts, researchers, statisticians, communication experts, etc, all have a place of their own – but perhaps are best placed in support functions (at headquarters) that help core contract managers deliver on their responsibilities. Contract managers will be experts not only in drawing up and enforcing contracts, but also have advanced budget and financial management skills.

What of donors that have a strong policy and advocacy focus, you ask? Won’t they need strong technical leads to further their agenda? Yes, that is true, but unless on their own, they form the dominant focus of an agency in a country, the above formulation should still hold. Also, fears of donors removing themselves farther from the reality of implementation if they are staffed increasingly by contract managers is not entirely unfounded, but is certainly not an unresolvable problem, and therefore a risk worth bearing.

As donors and their operational contexts evolve, and as the modalities of development cooperation changes, the strategic choices donors make about how they operate and how they are staffed will continue to evolve.

***

PS: Two small examples that hold meaning in the context of this post (or perhaps I am being entirely facetious)

  • DFID introduced its Smart Rules last year – a broad operating framework focused on programmes, intended to support DFID staff in improving programme delivery. Out of the 37 mandatory rules listed, I could find no more than 5 that refer directly to designing development programmes, or managing the complexity of their operating environments
  • I find it interesting that USAID is headed by an ‘Administrator’ – perhaps an absolutely honest descriptor of what that position entails, or perhaps entirely misleading – what do you think?
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