This appeared originally in The Guardian on March 8, 2013 (http://www.guardian.co.uk/global-development-professionals-network/2013/mar/08/institutional-reform-international-development)
Why institutional reforms in the developing world aren't working
Most proposed reforms are only a pretence at change, and lack the substance to transform governments
Billions of dollars are spent each year on institutional reforms in development, aimed ostensibly at improving the functionality of governments in developing countries. However, evaluations by the multilateral and bilateral organisations sponsoring such reforms show that success is often limited. These evaluations reveal that as many as 70% of reforms seem to have muted results. They produce new laws that are not implemented, or new budgets that are not executed, or new units and agencies that go unstaffed and unfunded. In short, new forms may emerge but they frequently lack functionality: what you see is not what you get.
I argue that these reform limits fester across the developing world because institutional reforms are commonly adopted to signal the intent to reform, not as efforts to actually change governments. The problem with reforms as signals is that they are frequently not capable of being implemented. They are devised with little attention to the contextual realities that actually shape (and constrain) change opportunities, promise overly demanding "best practice" solutions that look impressive but are commonly impossible to reproduce, and are negotiated with narrow sets of champions who seldom have enough influence to make change happen (especially with the distributed groups of agents who ultimately have to live with and implement new rules of the game).
There are examples of institutional reforms that are not limited to new forms without function, however. These reforms are not the product of signalling but emerge rather from a creative and endogenous process of change which Lant Pritchett, Michael Woolcock and I call problem-driven iterative adaptation. This type of change notes that more successful reforms are sparked by problems that people cannot ignore (not best practice solutions that outsiders say are important). The reforms emerge as groups of agents address these problems, in an iterative process of experimentation, learning and adaptation (not as singular champions commit to pre-designed reform models). Each step in the reform process allows reformers to learn more about how to solve their problem, build political support for the change process they are advocating, and establish new capacities required to implement this change.
Rwanda's Imihigo performance management initiative emerged through such process. This reform emerged after 1995 in response to a specific problem: the lack of service delivery in local governments and the way such had stoked inequality in the country before the 1995 genocide. Spurred by common concern about this, groups began meeting in the late 1990s. These included the president, the minister of local government, other national government officials, and international development specialists. They built on lessons from previous (failed) efforts to establish local governments and, in 1998, started experimenting. Using a small World Bank loan, they financed different service-delivery initiatives in many districts. The results and lessons of these experiments were captured and fed into a second wave of experiments in the early 2000s, which led to a rolling process of policy formulation and decentralisation (supported by a range of external organisations and donors).
Every few years the government assessed the lessons learned in this process, adjusted what it was doing, and took another step forward. One of these lesson-induced steps occurred in the mid-2000s.
The reform had matured to a point where district administrations were well established, financial flows had been structured to fit Rwandan realities and districts were starting to lead service provision. But there was no way to monitor performance or create incentives for the districts to pursue high levels of performance. An enlarged reform group that now included district mayors and other people responsible for implementing the reforms started looking for ways to address this specific problem.
They eschewed many "best practice" modern models of performance management as poorly fitted to their context and looked instead to a forgotten Rwandan tradition called Imihigo. According to this tradition, monarchs had used a simple reporting and rewards process to ensure that regional appointees were managing their regions well. These appointees gathered together at various points of the year and had to report – in a group – on what they had done. If the monarch deemed their performance acceptable, they could drink from a common calabash and were publicly recognised; if not, they were publicly passed over.
A version of this was adopted experimentally in 2006. It involved mayors reporting in a public space to the president or prime minister, using photographs, testimonies and other visible evidence of performance. Early lessons were captured and the Imihigo process was improved and diffused throughout the country, in districts and most recently into the national government as well.
It is a peculiar looking Rwandan performance management hybrid that does not fit any best practice script but addresses specific problems and enhances functionality, having emerged through a process of problem-driven, iterative adaptation. This is the process through which institutional reform in development has the highest chance of yielding more functional government and should be adopted more aggressively in the development community.
Matt Andrews is an associate professor at the Center for International Development at Harvard University, and author of The Limits of Institutional Reform in Development
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