Building State Capability:Evidence, Analysis, Action

Lant PritchettHarvard Kennedy School and Center for Global Development

January 16, 2017Enhancing Quality of Service Delivery Conference

Outline

• State Capability for Policy Implementation

• The Big Stuck

• Techniques for Successful Failure or How to not build capability

• PDIA (Problem Driven Iterative Adaptation)—building capability by delivering results

100

90

90

90

60

43

30

9.2

21.2

0

0 10 20 30 40 50 60 70 80 90 100

Czech Republic

Finland

Uruguay

Colombia

Top quartile by income

Second quartile by income

Third quartile by income

Lowest quartile

Bottom half of countries by…

Lowest 25 countries

Percent of 10 misaddressed letters coming back to USA within 90 days (all countries

agree to return within 30 days)

Includes not just Somalia and Myanmar but Tanzania, Ghana, Nigeria, Egypt, Russia, Mongolia, Cambodia, Honduras, Fiji, etc.

Source: Chong et al 2014

Service delivery outcomes from the same service vary across the whole range of possibilities: In Rwanda 97

percent of women completing grade 6 can read, in Nigeria only 12 percent

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

0 1 2 3 4 5 6

Percent of women aged 25-34 who can read all of a single sentence in their chosen langauge, latest

DHS data

Highest grade completed

Rwanda

Ethiopia

Average 51countries

Peru

Bangladesh

Nigeria

What is the “capability for policy implementation”?

Abstract definition of policy implementation

Elements of organizational capability

• Resources

• Capacity of individuals

• Extent to which individuals exercise their capacity to act in response to states of the world to further the (better) goals of the organization

• Acting on correct causal model of outputs to outcomes

Facts(“is it raining?”)

Actions by organizational

agents

PolicyFormula is

the mapping

Driver’s licenses in Delhi: What is the “policy” for getting a driver’s license?

• Studied people getting driver’s license

• Completely Typical de jurepolicy prove identity, residence, age, and driving competence

• De facto policy: hire a tout and the driver’s examination is waived

• >2/3 of those who got a license (and avoided test of competency) by hiring a tout had no driving skills at all

0

0.2

0.4

0.6

0.8

1

Hired an Agent Did not Hire anAgent

Took Driving Examination

Source: et al, Hanna, et al 2009

Organizational capability is not the sum of individual capacity

-0.5

-0.4

-0.3

-0.2

-0.1

0

0.1

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0.4

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1

1.2

Private Sector (ALL) Public Sector (ALL) Public Sector Doctors in theirPublic Clinics

Public Sector Doctors in theirPrivate Clinics

Stan

dar

diz

ed C

hec

klis

t Sc

ore

(St

and

ard

Dev

aiat

ion

s)

%C

hec

klis

t C

om

ple

tio

n

Standardized Checklist Score

Difference in performance for the same health care provider in their public and private clinics

Organization

Source: Das et al forthcoming

Individual capacity

The Big Stuck

Very negative Slow negativeSlow positive(with years to high capability) Rapid

Strong capability (SC>6.5) BHR, BHS, BRN CHL(0), SGP(0), KOR(0), QAT(0) ARE(0)

8 0 3 4 1

Middle capability (4<SC<6.5)

MDA, GUY, IRN, PHL, LKA, MNG, ZAF, MAR, THA, NAM, TTO, ARG, CRI

PER, EGY, CHN, MEX, LBN, VNM, BRA, Ind, JAM, SUR, PAN, CUB, TUN, JOR, OMN, MYS, KWT, ISR

KAZ(10820), GHA(4632), UKR(1216), ARM(1062), RUS(231), BWA(102), IDN(68), COL(56), TUR(55), DZA(55), ALB(42), SAU(28), URY(10), HRV(1)

45 13 18 14 0

Weak capability (2.5<SC<4)

GIN, VEN, MDG, LBY, PNG, KEN, NIC, GTM, SYR, DOM, PRY, SEN, GMB, BLR

MLI, CMR, MOZ, BFA, HND, ECU, BOL, PAK, MWI, GAB, AZE, SLV

UGA(6001), AGO(2738), TZA(371), BGD(244), ETH(103), ZMB(96)

32 14 12 6 0

Very weak capability (SC<2.5) YEM, ZWE, CIV

SOM, HTI, PRK, NGA, COG, TGO, MMR SDN(7270), SLE(333), ZAR(230), IRQ(92) NER(66), GNB(61), LBR(33)

17 3 7 4 3

102 30 40 28 4

70 of 102 countries had deteriorating

state capability in the aggregate over 1996-201249 of 102 countries have weak or very

weak state capability in 2012

At current trends only 13 of 102 developing countries would have

strong state capability even by 2100

Techniques of successful failure:

Isomorphic MimicryPremature Load Bearing

Pretend its Logistics

Isomorphic Mimicry is gaining survival value by looking like something else

(Remember: Red and black, friend of Jack, Red and Yellow, Kill a Fellow)

What is the ecosystem for organizational survival in which

isomorphic mimicry is a technique for succeeding as an organization

while failing at its purpose?

Ecosystem for organizations

Organization

Agents

How Open is the System?

How is Novelty Evaluated?

Strategies for Organizational Legitimation

within the Ecosystem

Leadership Strategies

Front-line Worker

Strategies

OpenClosed

Enhanced Functionality

AgendaConformity

IsomorphicMimicry

DemonstratedSuccess

Value Creation

Performance OrientedSelf-interest

Organizational Perpetuation

How do you destroy organizational capability? Premature load bearing

Import tax collectionagency

Available rewards to Non-compliance for individualagents

Rent collectors

Existing tax code

Maximally Feasible tax code

Trainin

g

No amount of training is going to increase organizational capability in practice when the stress of existing policy implementation already far exceeds capacity

Response to Low Capability:Make it logistics

Get rid of “discretionary” part of driver’s license?

Doctors to give patients all the same advice?

Teachers to follow a day to day script?

Procrustes and his bed

Once systems decide that logistics of input compliance is all they do….

Enrolments Inputs

Enrolment

in

government

schools

Enrolled in private

Percent

in

government

Percenta

ge with

drinking water

Percentage

with girl's toilet

Pupil teacher ratio

2004/05 5,487,221 4,297,171 56.1 79.8 25.4 55

2011/12 4,226,225 5,229,293 44.7 100.0 75.3 29

Gain/loss -1,260,996 932,122 -11.4 20.2 49.9 -26

A million children abandon public schools, learning is getting worse and worse and the Ministry declares success—with data.

Problems cannot be solved by the same level of thinking that created them.

Albert Einstein

The feasible path has to start from where you are….

“You cannot cross a chasm in two jumps”

…because if the first fails, you are at the bottom, with broken bones

PDIA (Problem Driven Iterative Adaptation) as an approach to

building capability of state organizations while producing

results

Out of 30 examined cases of successful reform in developing countries…

0

5

10

15

20

25

30

What MotivatesReform?

How do reformsget implemented

Final structures

Solution and LeaderDriven change

PDIA

Four Principles of PDIA(Problem-Driven Iterative Adaptation)

1. Local Solutions for Local Problems

2. Pushing Problem Driven Positive Deviance

3. Try, Learn, Iterate, Adapt

4. Scale Learning through Diffusion

This section is based on Andrews, Pritchett and Woolcock 2013 (forthcoming)

Local Solutions for Local Problems

o Agenda for action focused on a locally nominated (through some process) concrete problem

o Not “solution” driven that defines the problem as the lack of a particular input (e.g. “teacher qualifications”) or process (e.g. “EMIS”)

o Rigorous about measurable goals in the output/outcome space (e.g. cleaner streets, numbers of new exports, growth of exports)—can we know if the problem is being solved?

• Good problems

Examples of “problem driven”

Compliance Driven

• Enforce existing regulations on workplace safety

• Hire teachers with required qualifications

• Comply with procurement regulations

Problem Driven

• Reduce fatalities/accidents at work places

• Attract and retain teachers who help student progress

• Buy things effectively

Pushing Problem Driven Positive Deviation

o Authorize some agents (not all) to move from process to flexible and autonomous control to seek better results

o An “autonomy” for “performance accountability” swap (versus “process accountability”)

o Only works if the authorization is problem driven and measured and measurable… increase the ratio of “gale of creative destruction” to “idiot wind”

Authorizing positive deviation

o Allow flexibility in methods against specified and agreed to problems

o “Fence breaking” activities that allow deviations from process controls for designated activities

o Rapid feedback loops to search over design space

Design policy based on global “best practice”

Implement according to local constraints

LowerOutcome

OutcomeHigher

Outcome

Rent Seekers Bureaucrats Innovators

Organizations & Agencies

Policy Makers

Space forAchievable

Practice

Policies include process

barriers to prevent

malfeasance

Process controls also

prevent positive

deviations

Design policy/project to allow designated innovators to search for local “Best Fit ”

Internal authorization of positive deviation

Current outcomes

Worse outcomes

Rent Seekers BureaucratsDesignated Innovators

Policy Makers

Space forAchievable

Practice

Policy D

eviation

s

Feedback on Outcomes with shut down or modification of failures and/or replication of successes

Better Outcomes

PDIA: Building state capability by delivering results

• Focus on locally nominated problems for which there is authorization to act

• A sequence of steps to solve the problem that authorizes positive deviation

• Rapid iterative approach to making progress

• Scaling by diffusion of demonstrated practices across the organization