On June 19th and 21st the Efficiency Lab of the Spindle organised a training in efficiency analysis. We were pleased that 29 people participated, including project and programme managers, financial managers, M&E managers and consultants. The trainers were Markus Palenberg, CEO of the Institute for Development Strategy in Munich, Germany and author of what is considered standard literature in this field. Pol de Greve, Development Economist at Context, international cooperation, with vast experience an assessing the efficiency of development projects. The training was facilitated by Heinz Greijn, consultant of Learning4Development.
Why this training?
The training was organised because only few practitioners and evaluators are familiar with the methods and tools to assess efficiency. The efficiency question whether results are proportionate to the costs incurred, often remains inadequately addressed in project design and in evaluations. This limits what we can learn from projects and evaluations. Without efficiency analysis it is not possible to select the projects that generate most impact with the budget available, it is hard to make statements about the scalability of interventions and there is little incentive to innovate and develop ways do more with less.
Content of the training
In this two-day training, participants learned how to apply a variety of methods and tools including: cost effectiveness analysis (CEA), cost benefit analysis (CBA), multiple attribute decision making (MADM), benchmarking unit costs, partial efficiency indicators, follow the money, financial analysis and comparative rating by stakeholders. The training also included a section especially for M&E managers, on how to formulate terms of reference for evaluators in such a way that evaluations will lead to meaningful conclusions about efficiency. One of the reasons why efficiency is not adequately addressed in evaluations is because M&E managers don’t know what to ask for when they write the ToR for evaluations.
Theory of efficiency
During the training Heinz Greijn presented the theory of efficiency. The theory of efficiency is a framework developed by the Efficiency Lab that can help designers, implementors and evaluators of to determine which methods and tools for efficiency analysis are applicable to their specific type of project or programme, and what data need to be gathered to use these methods.
The concept of a theory of efficiency needs to be further developed and tested. Therefore, the Efficiency Lab will engage in a pilot which involves the development of theories of efficiency for a number of organisations including War Child, Woord en Daad, Simavi and Aflatoun. These four organisations will test the application of these ToEs in practice.
If you want to know more about the efficiency lab, check out this link.