Lessons from Africa
learning from nongovernmental organizations
Don't confuse “philanthropic” with “inefficient.” Nongovernmental organizations demonstrate lean project management practices.
BY TIM RUDKINS, PMP
Women in the village of Mokko, in southwestern Niger use loans to purchase goats and cattle, to build small businesses, and to feed and clothe their children. These goats are the prized possession of a woman who purchased them with money she saved through CARE's Mata Masu Dubara, Women on the Move program.
SOURCE: 2001 CARE/JOSH ESTEY
Many people see nongovernmental organizations (NGOs) as the “do-gooders” of the world, encompassing philanthropic groups such as CARE, World Vision and Doctors Without Borders. These not-for-profit groups work “globally” on a small scale. Some believe they spend their money freely without a glance at hard-nosed planning or, heaven forbid, return on investment (ROI), but actually, nothing could be further from the truth. Except for the fact that the work is carried out in impoverished countries, the size and complexity of aid projects are very similar to those of private industry.
For example, in 1990 CARE International developed a three-year rolling plan for the establishment of a regional lending institution across roughly one-third of the Republic of Niger in West Africa. The focus was on small- to medium-sized enterprises with a management and delivery team of 35 and 17 branch offices serving a client base of thousands. The initial budget was approximately $5 million, with each new phase increasing this by about $2 million. In the NGO world, this effort is a medium- to large-sized project.
Despite perceptions, the world of aid is both complicated and competitive. The NGO and development “market” is extremely aggressive, with speed and efficiency being prized assets. NGOs compete for funds from various sources. They not only develop solid products and services that satisfy their customers in developing countries, but they also must prove to their sponsors and donors that money was well spent. If not, they won't receive funds the next time.
All the stakeholders in an aid project have a number of explicit and implicit demands—just as in private-sector efforts. Donor countries often require employment for their own citizens, bilateral trade for their companies and strategic relationships.
The initiation phase of most projects begins with an investment by the NGO of their “uncommitted funds,” or donor money not directly targeted for a project. Extreme care is taken to ensure that these limited funds are well-invested. In short, NGOs operate in a market in the purest sense. Inefficiency is punished with an immediate drop in business—poorly managed NGOs close frequently. The good ones survive through better project management.
Revenue Through Projects
NGOs have head offices and functional departments similar to any other large organization, but they make their money and deliver their services through projects. The organizational structure of most NGOs is very flat, with a great deal of power located at the project management level. Functional groups exist to ensure the success of the projects. In the Niger example, the project manager reported to the country director who reported directly to the management team at the head office.
THE CARE METRICS PACKAGE
CARE International demonstrates how an organization should focus all projects on a common goal. By concentrating on emergency and development activities, the organization works to improve the lives of people in poor communities. Programs in agriculture, education, health, water and sanitation, nutrition, infrastructure and small enterprise activities involve multiple projects worldwide.
Using common targets across all projects, CARE can provide cost and other metrics by project, program, activity and goal level. According to CARE's 1999 Annual Report, for example, one education project trained 500 people, and the metrics were summed up as:
- Education Program = 228,000 trained
- Development Activity = 79 percent of costs
- Goal (All activities) = 25 million people.
Try this test on your business:
Can you state a goal for your project portfolio, such as a 25 percent return on investment and then review your project and program metrics to see whether this goal was attained? If not, take another look at your portfolio.
In Niger, the stakeholder analysis comprised interviews and discussions with national and regional authorities, village elders, business owners and local banks.
What can be learned? If products or services are delivered through projects, then the form of the organization should follow suit, particularly in service departments of larger organizations. Adjust employee reward and progress systems accordingly and make the jump to greater efficiency.
Also, if the project managers are major contributors to revenue and client satisfaction, make sure they have the power to match. A strategic project can quickly flounder because a project manager has to beg for second-rate resources from omnipotent functional managers.
NGO projects flow naturally from the strategic direction and goals of the organization. Programs set common target metrics, and projects follow them. Each project is seen as a piece of the overall program and the roll-up continues to the organizational level. To boost project efficiency, NGO projects follow basic rules.
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Common targets are set across all projects. In many ways, goal- and metric-setting in business is much easier than in NGOs. If the goal and metrics around a particular project don't mention ROI, one should question whether it's a valid project. For example, in the Niger project goals were defined as measurable increases in family income, jobs per business unit and total wealth for all participants and their families. All targets were achieved.
Projects are seen as tools for achieving organizational goals. Each project should be viewed as one aspect of a common corporate or departmental strategy. Tactics should be developed and projects should be evaluated against them. If they don't fit, they shouldn't be started. The Niger project was one part of CARE's overall Small Enterprise Sector Program, which had clear corporate goals and targets.
If it looks, smells and acts like a portfolio, treat it like one. No matter what line of business, if employees are spending more than 25 percent of their time on projects, portfolio management tools are required (see sidebar “The CARE Package”).
On the Right Foot
For NGOs in general, proper initiation is perhaps the strongest process. In the Niger Republic project, the initiation period took more than one year with analysis comprising macro-economic reviews of the region and target populations. Charters were created, critiqued and reworked until the team—including the future project manager—was satisfied that it related exactly to the stated need. Project goals were set including clear and measurable metrics. Because of this strong common agreement on needs and goals, the project could make activity changes later on, which resulted in an even greater satisfaction level.
To ensure a good start, project managers should ask, “Are we all completely clear about why this project is needed and when it will be finished (success factors achieved)?” In addition, stakeholder analysis must be serious and thorough, eliminating planning problems at the outset. In Niger, the stakeholder analysis comprised interviews and discussions with national and regional authorities, village elders, business owners and local banks. In the end, all were aware of the project's goals and had “bought into” the idea.
NGO projects rarely lack core elements of a full plan—budgets, schedules, work breakdown structures—prior to starting the work. Government departments or major funding institutions require these elements (usually by law) prior to the release of funds. Goals and objectives are stressed while allowing the project team members flexibility in their activities. The emphasis is on simplicity and taking responsibility. The Standish Group's 1997 Chaos Report cited a clear statement of requirements among the top three project success factors. If core documents or planning tools are overly complex, they will not be read, updated or used.
In addition, milestones must have clearly defined success indicators. Basic structural steps must be written down, but if project managers are open to different strategies for achieving goals, then staff will exhibit their own innovation and spirit. For example, in the Niger Republic project, one common deliverable and milestone was “Sub-Office Developed.” Success criteria were stated, but the actual “how-to” was not. The result? Seventeen different looks, all customized to the needs of the clients but achieving the same organizational goal. PM
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Tim Rudkins, PMP, is a Toronto, Ontario, Canada-based project management consultant. He has worked eight years in the NGO community and seven in the private sector.
PM NETWORK | AUGUST 2002 | www.pmi.org
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