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A Joint Presentation by Devesh Mishra and Henry Kerali January 2010 Improving Project Implementation Slide 2 Background & Objectives 2 Follow-up to ECA RMT Retreat of July 8-9, 2009 Delivering better services to the Client and finding innovative ways of meeting Client demand Working better as a task team on project implementation and procurement Increasing our internal fiduciary capacity with the right control Increasing procurement capacity of the Client Working better with donors on project preparation and implementation Responding to the crisis and improving disbursement and results on the ground Slide 3 Actions Taken Since July 2009 Consultations with ECA staff in HD, SD and procurement and their feedback obtained Discussions held with Chief Procurement Policy Officer of the Bank, Procurement Manager of LAC Issues discussed with few country units and sectors to get feedback and way forward (Example: HD, ECCU1, ECCU3, ECCU8) 3 Slide 4 Existing Procedures and Practices Existing OP11.0/BP11.0 on Procurement (under revision) ECA VP Regional Procurement Management Guidelines of May 02, 2003 ECA Regional Guidelines on Integration of FM and Procurement Staff in project teams (December 11, 2003) Agreement with European Commission on key differences in EC and Bank procurement procedures (April 2005) A best practice review of procurement, FM and QA in the six regions of the Bank (ECSPS report of January 2006) Use of Country System in Bank funded operations (June 2008) Details available on Procurement websites of OPCS and of ECA Procurement 4 Slide 5 Feedback and Voices 5 Need to understand the capacity and control environment in different Regions: Russia and Kazakhstan are different from Brazil and Mexico Same policies and practices in all regions LAC places emphasis on: good communication between the procurement and country units; and dissemination of good practices and customizing AAA services for MICs But, new control environment in the Bank: Sanctions Regime, Volcker Panel, IDA-14 Control Review Effects of Albania and India DIR: extra due diligence Slide 6 Feedback and Voices (contd.) 6 Put our clients/customers firstApply procurement guidelines and procedures to the benefit of our Client Bank task teams work better when procurement staff is well integrated in the team Work overload: staff hiring to be expedited (use 3-5-7 GG rotation as well) and experienced international staff to be field-based Our Clients say that the Bank is too slowin certain cases reviews take longer than business standard due to: Weak client capacity and therefore poor documentation; Inadequate project preparation; Client insists on award of contract to unqualified firms Slide 7 Feedback and Voices (contd.) 7 Examples from ECCU3 (Azerbaijan portfolio review of October 2009) With few outliers, procurement response time is within business standardsbut we also need to monitor overall turn-round times Long project durations from the identification (design) to the end (contract completion) with several changes in Bank staff. Is this the intended purpose of a 4-lane highway (in South Asia)? Slide 8 Feedback and Voices (contd.) 8 Bring services closer to the Clientdecentralization: It has been observed that fewer issues arise from projects in countries with field-based PAS. This is a clear sign that taking procurement reviews closer to the Client has positive outcomes. Good examples: Central Asia Team South Caucasus team Increase threshold for prior review for faster response Slide 9 Feedback and Voices (contd.) 9 More delegation to TTLs or more procurement accreditation to TTLs (with agreed framework for RPM review) Some TTLs are not experienced and there are experienced TTLs who ask for exceptions all the time Technical capacity lacking in some cases; power engineers, equipment specialists, bridge engineers In few cases TTLs and Procurement Specialist do not talk with the same voice to the client Slide 10 Areas of Improvement and Next Steps 10 Better Integration of procurement staff into the task team: a challenge for managers Building client capacity at the project preparation stage, in particular of the key members of the clients project team Meeting service standards and avoid churning; monitor overall turn-round time Manage client expectation upfront and explain how the review process works and to factor the time in our procurement plan To say Yes or No with speed and clarity Slide 11 Areas of Improvement and Next Steps 11 Tighter joint monitoring of procurement and implementation For several projects, procurement staff had zero interaction with the Client and they never went on a supervision mission if this due to budget constraints? Regular meeting with the Client a structured approach that made a real difference in Russia Active use of procurement plans: to be used as a tool of project implementation Statistics on response time to be kept and disseminated Slide 12 Areas of Improvement and Next Steps 12 Fiduciary training of TTLs: minimum two day training and ensure that all TTLs have taken this training More training of Borrower staff in early stages of project preparation based on real case studies Intensive six week training by RPM office to field-based procurement assistants and analyst should continue Sharing of information on INT investigations to task teams and country units Slide 13 Areas of Improvement and Next Steps 13 Expedite use of Country Systems with more Risk based reviews of procurement tasks within a project Good examples: Poland Odra river, Renewable Energy II in Turkey The report of January 2006 on the best practice review of procurement and financial management concluded that ECA is at the top of the game in terms of volume of work and quality of results (based on comparative data) Need to review and benchmark with other region Hold briefing sessions with TTLs and project teams to disseminate the findings( including Ten Dos and Donts to Improve Effectiveness of Task Teams) Slide 14 Ten Dos and Donts to Improve Effectiveness of Task Teams 14 1. Involve procurement staff in the project team prior to the Project Concept (PCN) stage 2. Give priority to the needs of the Client - take stock of project implementation and procurement capacity at pre- appraisal and identify steps to mitigate any lack of Borrower capacity 3. Use the procurement plan as a tool for project implementation and monitoring disbursement progress 4. Have an agreement among the team members on issues and rules of engagement (e.g. response times) before conveying these to the Client 5. TTLs should be the focal point and voice for any interaction with the Client Slide 15 Ten Dos and Donts to Improve Effectiveness of Task Teams 6. Teams should not commit to procurement decisions during missions without clearing this with the relevant procurement authority (PAS, RPM or OPRC) 7. Teams should take joint responsibility for project decisions and should not pass the blame on to individual team members. Refer matters to your manager and to the RPM if there are differences of opinion within teams 8. Do not criticize the Banks procurement policy and procedures to the Client. We all belong to the same Bank. 9. Bring issues on Conflict of Interest or Fraud and Corruption quickly to the attention of Sector and Country Managers and the respective Country Directors 10. Pay attention to "Readiness for Implementation" during preparation. An early start of the procurement process prior to effectiveness will build the capacity of the Borrower and expedite project implementation 15 Slide 16 Procurement is an integral part of the project implementation team - work with the client to achieve results on the ground 16 Slide 17 We are in the same boat with the client and let us work with a renewed relationship and vigor 17 Slide 18 And share the joy of winning 18