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Duke University
Sanford Institute of Public Policy
Program in International Development Policy - PIDP

These papers are produced as part of a Seminar on Institutional Design in the Program in International Development Policy (PIDP) at Duke University's Center for International Development Policy. The Seminar is led by Professor Francis Lethem who initiated the original research programs that produced the AIC concept. He was also co-author of the first AIC paper "The Design of Organizations for Rural Development".

TOWARDS AN APPROPRIATE INSTITUTIONAL DESIGN METHODOLOGY

Francis Lethem

FROM AIC TO AIC-IA: Applying the AIC Framework to Capacity Building The Case of the Police Inspectorate of Kosovo

By Selim Selimi

Abstract: This paper analyzes the reasons for the remarkable success of an institution-building initiative in a post-conflict situation—namely the establishment of a Police Inspectorate in Kosovo (PIK). Selim Selimi shows that rather than create and run the new institution itself, as most international organizations tend to do in similar circumstances, OSCE (the Organization for Security and Cooperation in Europe) (a) first ensured the new organization's legitimacy within the framework of the country's legal system; (b) enlisted the support of the organization's main stakeholders and provided for a sound implementation plan under which PIK was initially jointly managed by OSCE and a national partner; (c) withdrew from line management to become a management adviser; and ultimately (d) moved away from operational responsibilities to become a policy adviser to Government—thus ensuring that PIK would continue to benefit from a supportive enabling environment. In sum, this capacity-building project owes its success to adoption of the original AIC design sequence, and its reformulation into an innovative design sequence, AIC-IAbstract.

COMBATING HIV/AIDS THROUGH EMPLOYMENT GENERATION: Doing Good Requires a Disciplined Design Methodology

By Bibi R Khan, Fellow, PIDP Program, Duke University

Abstract: This paper is based on Ms Khaan's personal experience working as a Peace Corps Volunteer. She was part of a team that designed and implemented business models as an HIV/AIDS prevention initiative strategy to be implemented in the high HIV/AIDS prevalence areas of the Central African country of Zanitar. The paper contrasts two projects initiated with good intentions by a major international NGO—one a success and the other a failure—and shows that the principles of good project design and good institutional design have a lot in common

EMPLOYING THE AIC METHODOLOGY IN PEACE CORPS TRAINING PROGRAMS: Reflections on a Vanuatu Experience

By Jason Rodriguez, PIDP Fellow, Duke University

Abstract: Serving in a developing country as a Peace Corps Volunteer is a unique, challenging experience with incredible potential, both to contribute to the country's sustainable development and to develop strong bonds of friendship which transcend culture, language and worldview. However, the success of a volunteer is closely linked with his/her ability not only to integrate into the community in which he/she is placed, but also to inspire community ownership of the projects that he/she promotes so as to ensure their sustainability after the volunteer has left the country. To that intent, training of new volunteers in the use of a methodology, such as the AIC framework would be highly beneficial, as it would help them better understand the interplay of the various actors they will encounter in the local society, as well as more appropriately structure the design steps for their projects. This paper is based on the author's experience as a Peace Corps Volunteer in Vanuatu from 2002 to 2005 and was written with the hope that it would benefit both the Peace Corps Vanuatu office and other Peace Corps offices worldwide.

1 Final paper prepared for the PIDP seminar "Institutional Design for Sustainable Development", Fall 2008 and edited by Professor Francis Lethem.

RESTRUCTURING THE INSTITUTIONAL DESIGN OF AN INFRASTRUCTURE GOVERNMENT IN GUANAJUATO, MEXICO

Francisco Javier Luna Lopez

Abstract: This paper reviews the institutional design of a pilot project financed by the World Bank in the State of Guanajuato, Mexico, as part of its strategy to improve the institutional capacities of local governments in middle-income countries. After two years of implementation, the project has introduced several institutional improvements such as the consideration of investment proposals over a longer term perspective, the strengthening of the agency responsible for protection of the environment, and the adoption of a better framework for dealing with social issues. However, it has failed so far in its principal objective of introducing procedures to ensure that public investments would be sound from a social and environmental viewpoint and that those affected by such investments would have a voice in the decisions about such projects. The paper identifies the project's institutional design methodology as the primary source of the problems and proposes adoption of the AIC framework for its redesign. This would require (1) establishing a consensus among key stakeholders as to the primary causes of the institutional problems (which the author believes to be the choice of an inappropriate implementation agency and the lack of initial consensus-building processes) to help overcome possible resistance to the proposed changes; (2) selection of a strengthened alternative implementation agency which would already have the political and institutional legitimacy to promote the intended policy changes; and (3) design of detailed consultative procedures for implementation by all agencies concerned and strengthening of their process capabilities. The advent of a new administration in 2006 provides a unique opportunity to attempt such changes.

MANAGING BY INFLUENCE FOR THE COMMON GOOD: India's SAMBANDH Network

Santosh Passi

Abstract: This paper reviews the institutional design of a network of NGOs in Northern India and analyzes the reasons for its success. Essentially, it is due to the remarkable ability of the network's low-profile leadership to avoid the traditional top-down management style and instead, manage by influence. They did so by (i) ensuring that members strongly shared common purposes so as to strengthen the network's cohesiveness, (ii)"empowering" members through provision of effective common logistical, informational, and training services, and (iii) engineering a policy coalition giving members and non-members highly visible roles and full credit for their contributions. The paper also argues that external donors should adopt a similar management style in their relations with the network, ast he traditional top-down project design approach would be antithetical to the very reasons for the network's success.

FROM POST-CONFLICT EMERGENCY TOWARD LONGER TERM SUSTAINABILITY: Restructuring Kosovo's Customs Service Administration

Edmond Mjekiqi

Abstract: This paper highlights the relevance of the AIC methodology of institutional design to ensure that post-conflict reconstruction efforts will have a lasting impact. In this case, the challenge was how best to integrate Kosovo's Customs Service (UCS)—an agency created and administered by the UN Mission to Kosovo—within the Province's future administration, while ensuring its continued professional competency and integrity. Designers unfortunately chose a "control approach" which led to a conflict with national authorities. Instead, argues the paper, they should have first searched for common ground on objectives with UCS' key stakeholders, agreed with them on the agency's location within Government, and only then design external linkages and internal arrangements. The case also illustrates the risks for a key stakeholder to act as the institutional designer, rather than rely on independent professional assistance.

RESETTLING EXPELLED VILLAGERS TO THEIR PLACES OF ORIGIN: 20 Years Later

Dalia Kaikhasraw, Fall 2004

Abstract: This paper reviews why two successive projects failed to resettle internally displaced persons to their former village in Northern Iraq, from which they had been forcibly removed 20 years before. It turned out that both the Regional Government and the implementing NGOs assumed that they were dealing with a routine reconstruction and resettlement project. As a result, they skipped the first two stages of institutional design expected under the AIC methodology, namely (a) the "appreciative" and learning stage which would have helped them better understand the project's unfavorable enabling environment and hopefully led to a common vision of an acceptable, more complex project; and (b) the "influence" stage of design during which designers/implementers would have realized the need for various institutional linkages so as to ensure availability of complementary design skills not found in a single NGO and implementation of complementary projects.

COMMERCIAL BANKING FOR RURAL DEVELOPMENT: a Cautionary Tale:

Santoshkumar Thiruthimana,

Abstract: This paper describes the strategy adopted by a large commercial bank to start lending for rural development, a sector with which it was not familiar. Nevertheless, it chose a supply-side (rather than demand-driven) approach to financing introduction of new crops, entered into a partnership with an ill-informed foreign aid agency, by-passed local institutional structures (both public and private) and failed to understand its intended clients—all of which doomed the project. The author explains how use of the AIC methodology could have led to a more successful project: most critical was to start with a learning process to identify key stakeholders and policy issues; then to generate a genuine consensus on project objectives and a strategy to overcome policy obstacles; establish cooperative relationships with key stakeholders; and finally, devise, incentives to motivate the bank's own staff.

COULD GEORGIA'S SMALL FARMER SUPPORT PROJECT HAVE BEEN SUCCESSFUL?

Nino Partskhaladze

Abstract: This paper uses AIC to evaluate the reason for failure of development projects, a Small Farmer Support (SFS) project funded by USDA at the end of 1996. This project aimed at improving household security for 20,000 small farmers by increasing crop production and reducing post-harvest losses over a two and a half-year period. The beneficiaries of the project were small farmers owning no more than 4 ha of land and living in seven mountainous districts of South and West Georgia

ESTABLISHMENT OF AGRICULTURAL SERVICES IN A TRANSITION COUNTRY

Inna Bayda

Abstract: This paper examines the recent experience of a transition country, to which we'll refer as Transishnyia, with the development of its agricultural support services. These services were designed and financed primarily with international donor assistance with which Bayda was associated at the evaluation stage. The purpose of this paper is to re-interpret the program's institutional design with the help of the AIC framework and propose recommendations for program improvement and further development.

INSTITUTIONAL ANALYSIS OF A BUSINESS DEVELOPMENT PROJECT

Samir Nuriyev

Abstract: After regaining its independence in the early nineties, Transyshnia began the transition from a command to a market economy and its integration into the world economic system. One of the government's main priorities became the promotion and development of the country's business environment. International organizations also assisted the government in supporting local entrepreneurs. They provided technical assistance through various training programs, and financial support through small- and large-scale credit schemes. This paper evaluates the results of a recently completed business support project undertaken by a general-purpose multilateral development organization (MDO) in association with the country's National Commission for Competitiveness and Entrepreneurship (NCCE). Unfortunately, the project did not meet its objectives, and this paper applies the AIC methodology to assess the extent to which poor institutional design was at the origin of the problems and what alternatives could have been considered.

POST-CONFLICT PARTICIPATORY CONSTITUTION-MAKING PROCESSES

Mitchell O'Brien, April 2004

Abstract: The paper highlights the importance of peacebuilding strategies in the post conflict stage of war. One of the most promising tools at the disposal of those who seek to overcome the mistrust that represents post conflict societies and to build relationships between groups who, until recently, were bitter enemies, are participatory constitution-making processes. Aside from their contribution to peacebuilding, such processes are more likely to build a democracy that the entire community owns and supports. This policy paper uses the AIC process to examine how best to implement new constitutionalism in a post conflict scenario with the aim of legitimizing a democratic outcome and to aid in the peacebuilding process.

MANAGEMENT OF THE HUAI RIVER BASIN

Zheng Zhou

Abstract: This paper introduced a new way of looking at Chinese institutional management, which relies on the recognition of "external factors" and "influence" rather than "internal matters" and "control." The latter view is especially prevalent and deep-rooted in the mindset of institutions in China, as the consequence of over two thousand years of reign by feudal authoritarian political regimes. The "Forbidden City" in Beijing, despite its grandeur, serves as a living reminder of how decisions regarding the fate of a nation had been formulated in a close and inward-looking manner until as recently as 90 years ago, when the last feudal dynasty was overthrown. Hukkinen provides a more recent observation that illustrates the persistence of the "control" mindset in China and among Chinese institutions during her interview with Chinese environmental managers.

INSTITUTIONAL DESIGN: Restructuring a former stated-owned enterprise

Valerian Khagay

Abstract: Khagay uses the AIC framework to explain the restructuring of a former larg,e state-owned enterprise in Kazakhstan from the standpoint of a manager of the enterprise restructuring project funded by the European Community (EC). He analyzes the problems that the project faced during implementation, the reasons why in many instances the project did not meet fully its objectives and provides some recommendations as to which approaches the manager of the restructuring project would have had to take in order to really turn around the company. The learning from the restructuring is presented along with recommendations.

INSITUTIONAL ANALYSIS OF COLUMBIA'S PRODUCTIVITY IMPROVEMENT PROGRAM

Minoru Yamada

Abstract: This paper deals with Colombia's adoption of a "productivity movement" program as a means to achieve increased international competitiveness of Colombian companies. It is only recently that the country initiated this program, and it might be too early to make a definitive evaluation of its performance. However, with the help of the AIC framework, this paper attempts to point out current and potential problems the program could face in the course of implementation and to propose recommendations for addressing such problems. Improving productivity is obviously beneficial to the various parties in the economy. However, how best to effectively achieve this goal is less obvious. This paper's analysis, based on the AIC framework, seems to suggest that Colombia's current approach, characterized by relatively strong control of the government, is not very promising. The country's top-down approach results in excluding some potential beneficiaries while the quality of CNP's services may be questionable as a result of its lack of incentives towards listening to its clients' voices. A greater voice and more voluntary involvement by the private sector seems to be essential for CNP's success.

THE COLOMBIAN EDUCATIONAL REFORM: AN INSTITUTIONAL ANALYSIS

Yolanda Quintero

Astract. In Colombia, there is nowadays a consensus about the need to expand and modernize the education sector in order to sustain the country's economic growth and development. Surprisingly, however, the education sector reform which was launched in 1991 did not achieve its objectives, even though it had been preceded by the enactment of a new constitution following a highly participatory and democratic process that transformed significantly the institutional arrangements within the country.

Colombia's education reform failed from the very beginning because its proponents failed to develop a consensus among those benefiting and those being negatively affected by it. The approach of the Colombian government was mainly technocratic and even within the government itself there were competing agendas. By ignoring the importance of developing a constituency for their purposes and of involving the key stakeholders, the reformers lost the political window of opportunity that was offered by the country's institutional transformation towards more local autonomy. In other words, the Colombian education reform failed to ensure its legitimacy.

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