Striking a Balance: Payment by Results and Adaptive Management

A few months ago, my colleagues and I invested significant amount of time to design a project that championed local ownership, accountability to beneficiaries and adaptive management. We were explicit about our methodologies and about how the results would be defined by the beneficiaries during the inception phase of the project: our philosophy was that success would be more likely to be achieved if the beneficiaries could decide what success looked like – for them. Beyond the jargon, the proposal was good. Good enough to be approved by the donor and for us to get excited about a project with a truly adaptive management approach. But when it came time to sign the contract, the dreaded ‘payment by results’ phrase magically appeared. Out of nowhere, we were told we needed to have ‘pre-defined results’ before the project could move ahead.

I should hardly have been surprised by this development – the donor community has consistently undercut development effectiveness principles and the concept of ownership by pushing value for money and payment by results agendas. It’s no wonder international development is derided and the people and governments it is supposed to benefit disillusioned Goodness, it’s a daily struggle to keep the derision and cynicism out of my own voice when I have to talk about it.

It is increasingly obvious that donors and development organizations work in parallel universes. It is even more obvious that no one can agree on who we – donors and implementers alike – are primarily accountable to. To be completely candid: there seems to be a misunderstanding amongst donors that it is either-or when it comes to accountability to stakeholders versus financial accountability. There is an inability to give up some control of the process, despite the fact that research[1] – not to mention general feedback – debunks the idea that development projects are most useful and their results sustainable when they are over-simplified, linear, and have pre-determined results that must be achieved regardless of shifting contextual environments.

I can see why donors are having real difficulty transitioning away from this control mindset towards more effective approaches to development (such as adaptive management approaches, which are demonstrating more sustainability in their results amongst ongoing testing). We have all read the flashy headlines about the misuse of funds, or the projects that failed to achieve their goals (*cough*), and the backlash governments face from their constituents over ostensibly ‘wasted tax-payer money.’

We are all still stuck in a conundrum, however. Development professionals recognize that our approach to development needs to change, but we are pushing an agenda (adaptive management) that has the other side (donors) feeling like there will be no accountability for money spent or neatly packaged results that they can report back on. So, how do we strike a balance to achieve all our goals?

We already have the tools, we’re just not good at prioritizing them. In my upcoming book on how to implement a monitoring and evaluation framework in an adaptive project I provide in-depth guidance on how to employ these tools on a daily basis: proper risk management, tracking, recording and resolving challenges to the project, joint project reviews (and monitoring missions!), joint problem solving and an overall candidness in communications between donors and implementers can make a difference. It alleviates the fears of ‘losing control’ on the side of the donors, while also providing regular opportunities for implementers to demonstrate the challenges they are up against.

These are easy fixes, but the biggest roadblock will be the changes in mindsets on both sides – a recognition that we are on the same side, which, given the often acrimonious relationships to date, is not something that we (both donors and implementers) are quite ready to admit.

---

[1] See for example: Duncan Green’s 2016 book ‘How Change Happens’ (free to download at how-change-happens.com), and Ben Ramalingham’s 2013 book ‘Aid on the Edge of Chaos’.