World Bank Presentation by Dr. Andy Macdonald

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World Bank Presentationby Dr. Andy Macdonald

• Washington, D.C.
• June 29, 2001

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Presentation Outline

• Brief Review of Work Experience
• Competencies and Lessons Learned
• Change Management Experience
• Experience in Canada, Australia and South Africa
• Purely personal observations on success
  strategies and relevance to development
  initiatives
• Discussion

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Early Work Experience (1963-76)

• Electrical Engineer
• Problem analysis
• Project management
• Transportation Expert
• Regional development
• Systems costing
• Transportation Institute
• Project management
• Focusing researchers on results

• Transport Canada
• Strategic Planning
• Federal-provincial relations
• Results-based resource allocation
• Budgeting process

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Office of the Comptroller General

• Budget and Estimates reform
• Policy development implementation
• (Selling the unwanted to the unwilling)
• Parliamentary Liaison
• (leading the horse to water)
• Program budgeting early experiences
• Supply push vs. demand pull the challenge
• Government Financial Management
• Perceptions of senior management
• Cash management
• Risk approach to control
• Accrual accounting

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Comptroller General (1989-1993)

• Governance issues
• Functional direction in 3 communities
• Financial Transparency
• Financial statements
• Linkages to outputs
• Fraud monitoring detection
• Program performance measurement
• Role of program evaluation, audit, financial
  managers
• Management representations
• Audit assurance
• Human resource management issues
• Targeted recruitment/development programs
• Staffing of key individuals

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CIO- Canada (1993-95)

• Government-wide approach
• Major cultural change
• Internal and external impacts
• IT Strategic Plan
• Business/HR/information focustechnology
• Major communications effort
• Multiple stakeholders, deep-seated prejudices
• Internal process re-engineering
• Council for change
• Procurement processes
• Time to achieve change

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CIO Australia (1995-98)

• First CIO
• Challenges of government-wide approach
• External change agent
• Role of visible senior champion(Minister)
• Strategic Plan
• Service delivery focus
• Significant public interest
• Department involvement
• Internal and external impacts
• Challenges of implementation ( coming down from
  60,000 feet)

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CIO Australia (Continued)

• Outsourcing Initiative
• Major cultural change, strongly resisted
• Approval process dictatorship of the Cabinet
  table
• Opposition
• IT community
• Departments and their Ministers
• IT Industry SMEs economic development
• Opposition party and parliament processes
• Excellent example of change management
• Communications strategy
• Lessons learned

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Change Mangement Principles

• Sense of Urgency
• Develop Powerful Coalition
• Create the Vision
• Communicate the Vision
• Empowering others to act
• Get early successes
• Build on early successes for fundamental changes
• Institutionalize the changes Kotter, John P.,
    Leading Change , The Leaders Change
  Handbook, Jossy Bass (San Francisco, 1999) p 99.

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Principles IT Outsourcing

• Urgency crisis can be opportunity
• Incoming governments 1 Billion IT spend
  reduction
• Competitive Government in Asia Pacific
• Powerful Coalition inside out
• Minister of Finance, Senior Advisor, Treasurer
  and PM
• State support politically (South Australia,
  Victoria)
• AIIA major players
• Create the Vision
• Best practice in private sector- non-core
• Market testing basis, not by fiat
• Benefits extend far beyond cost savings
• Technical currency, service levels, career paths
  for IT staff,scalable assistance
• Key strategies credible market testing,
  communications throughout exercise, cluster
  approach, departmental champions

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Principles IT Outsourcing (contd)

• Communicate the Vision
• Cabinet decision and resource adjustments
• Role of Minister, CGIO in championing vision
• Four stages of adjustment
• Specific communications person general
  meetings, departmental meetings, weekly
  newsletters, conference speaking engagements,
  media interviews
• Political costs of communication
• Empowering others to act
• Many obstacles to change departmental
  Secretaries, IT community, IT SMEs, Opposition
  party, Senate, media
• Major pension policy changes required
• Economic development multiple objectives
• Departmental champions and peer group endorsement
• Risk management concept difficult in polarized
  political environment

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Principles IT Outsourcing (contd)

• Early successes
• Build momentum and credibility for initiative
  risk of lost momentum
• Veterans Affairs Department of Finance
  unanticipated outcome
• No rewards for successes governments tend to
  punish more than reward
• Institutionalizing the changes
• The most difficult part bureaucracies are very
  immobile and tend to snap back when the pressure
  is relieved
• Changes take a long time to implement and require
  constant pressure until the process becomes
  irreversible
• The Humphrey review - 2001

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Personal Reflections

• Major change is possible in government
  administration
• People change when the perceived cost of change
  is exceeded by the cost of the status quo
• But, reform in government requires patience
• Risk averse culture status quo safer
• NIH resistance can be quite pronounced - were
  different
• Multiple competing objectives complicate change
  management process
• Nature of government processes
• Competing stakeholders pressure to satisifice vs.
  optimize
• Optimal solutions rare practical trade-offs
  omnipresent
• Criticism from opposition

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Personal Reflections (Contd)

• Major change can only occur after a strong shock
  to the system
• Small vs. large budget cuts
• Expect strong resistance from the agencies
• Strength of status quo
• Needs strong support from the centre
• Continuous pressure to continue the process
• Budget cuts get attention

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Personal Reflections (Contd)

• External change agents have greater chance of
  success
• Greater perceived authority/experience
• No baggage
• Easier access to key decision makers
• Unencumbered by internal constraints tell it
  like it is
• Senior, highly-visible and articulate
  spokesperson(s)
• Complemented by internal champions at middle
  management levels
• South Africa experience
• Communications is critical
• Your can never over-communicate
• All stakeholders targeted, including affected
  staff

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Personal Reflections (Contd)

• Metrics are critical to monitor change
• If you are not keeping score, you are only
  practisingInter-agency benchmarking for
  comparison of progress
• Peer group endorsement strategy
• Wide consultation with agencies
• Shared project responsibility
• Lead agency concept
• Knowing when to stop consulting
• Information is a strategic government resource
  that is underdeveloped

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Personal Reflections (Concluded)

• External pressures from funding agencies can be
  crucial
• Major shock to system
• External agent of change
• Expertise provided
• Locking it in
• Requires internal senior champion and supportive
  agencies (peer endorsement)
• Bureaucratic buy-in is important for long term
  changes
• Benefits must accrue to the public

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• Discussion