TAILIEUCHUNG - Strengthening Institutional Capacity during Project Implementation

As we said at the beginning, the aim of projects is to initiate change, to promote innovation. One of the most difficult parts of project management is the process of implementation, of taking the outcomes of projects and integrating them into the everyday work of the institution. One of the reasons for this is the special status of projects – they have special time and resources allocated to them and those who are involved, both the project team and any students who take part, are motivated by the experimental nature of the work | Guidance Note for Project Management Strengthening Institutional Capacity during Project Implementation October 2005 FOREWORD Helping to build country institutional capacity is at the heart of the World Bank s mission to promote sustainable development and poverty reduction. Greater integration of project management in a country s existing institutions and systems is important to this goal and to the Bank s effort to move toward greater use of country systems in lending. The Paris Declaration on Aid Effectiveness adopted at the High-Level Forum in March 2005 reaffirmed the donor community s commitment to align their programs to national development strategies institutions and procedures. It identified a reduction in the number of parallel project implementation units PIUs as one of the key actions the aid community could take to promote greater capacity development within our borrowers and thus increase aid effectiveness. The organizational structure for project management is often chosen to mitigate risk in a weak capacity environment but it may also reflect internal incentives that focus on speed of project processing and disbursement and perceived stigmas in low implementation performance ratings. The result is often the use of PIUs sometimes semi-permanently even though regional studies have shown that they are suboptimal organizational arrangements and create problems of morale among government officials. While there are examples of good efforts during project design and implementation to focus on sustainable institutional capacity development and use of country systems they are rare. This note aims to encourage operations managers and staff not only to give priority to project implementation performance but also to balance it with sustainable institutional capacity development beyond the project. To that end existing country institutions should be the default mode and PIUs especially parallel stand-alone PIUs should be phased out. This note reflects lessons .

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