Monday, July 25, 2011

World Bank as Convener 1st, Lender 2nd?

"Are you sure we should do this in the World Bank atrium?"

"Yes, sir," I said.  "Why not?"

I tried to act confident, but I was terrified.  It was February 1998, and on the phone was a managing director, second only in power to the president of the World Bank.  He was known for asking questions that were actually orders. Arguing rather than obeying was considered ill-advised.

"Well," he said, "we may have outside visitors that day.   Do you think they should see some of those crazy ideas that staff may come up with?  What if we relocated the event to the basement, out of the way?"

A small innovation team, with encouragement from Jim Wolfensohn, the Bank's president, had decided to launch the first-ever Innovation Marketplace, a one-day event when any Bank staff member (regardless of title or seniority) could propose an idea for helping the Bank better fight poverty.  We would award $5 million to help fund the start-up of the most promising ideas. We had decided to hold the event in the atrium of the Bank, a beautiful space that soars thirteen stories.

The only problem was that the atrium was almost never used for public events; it was always eerily quiet and deserted, even sterile.  You never wanted to linger there - you always hurried through. The culture of the Bank at that time was such that everyone worked behind closed doors, beavering away on in-depth country or sector studies designed to find out the right answers to various development challenges.  Staff emerged only for the occasional review meetings, or to go on mission to the countries they worked on.

My, oh, my how the world - and the World Bank - have changed since then.  A couple of months ago, I went back to my old stomping grounds to witness an Apps for Development competition. Not only was the Bank's atrium a beehive of activity, but there was even techno music pumping up the mood of the crowd before the announcement of the event's winners.

Stephanie Strom recently wrote a nice article in the NY Times about how the Bank is opening its "treasure chest of data" for researchers and others around the world to use.  The articles has good insights into the benefits of making data public; and the fact that the World Bank (previously among the most secretive of aid institutions) is now making such huge strides is sure to encourage other agencies to do the same.  (The UNDP also created a very impressive open data portal for some of its projects.)

Sharing data is a big leap, but there is now a window of opportunity for the Bank to do something much, much bigger.  Back in 1998, with my heart pounding, I stood my ground with the Managing Director, and the Innovation Marketplace was a huge success; by cutting through the usual layers of bureaucracy and giving everyone an equal voice, the event allowed all sorts of good ideas to bubble up, any many of them soon became major strategic.  In some sense, we were democratizing the World Bank, even if for only one day.

Building on that success, in early 2000 we went on to launch the Development Marketplace, which allowed anyone in the world (not just the Bank) to propose an idea for funding.  The planning of this event also generated a lot of controversy (and not only from senior managers this time), but it was a big success, too.  And though I left the World Bank shortly afterwards to co-found GlobalGiving, the Bank went on to replicate the Development Marketplace many times, including in some seventy countries around the world over the past decade.  Country directors would sometime report that it was the first time they had been able to get civil society groups and government officials in one room together talking about ideas and solutions rather than just arguing.

Nonetheless, despite their success, these marketplaces have remained peripheral to World Bank's main business.  In the decade since my departure, many former colleagues complained to me that the Bank was failing to innovate in ways that would keep it relevant for a changing world.

That may be about to change.  Bob Zoellick, the Bank's current president, recently talked in a speech about the "democratization" of development, where the Bank and other aid agencies no longer pretend to have a monopoly on understanding problems and devising solutions. Bank experts would still have a great deal of technical expertise, but the role of Bank staff would shift.  Instead of trying to find and hire the elusive "best expert in the world on subject X," the Bank would hire very good experts who are capable of leading a conversation among other experts, government officials, and regular citizens about the most pressing problems and the most viable potential solutions.  Bank staff would in a sense become "hosts" of conversations about what to do, and then would have the ability to financially support the initiatives and approaches that arise from these conversations.

Hosting effective conversations is hard, and it may be the most in-demand skill at the Bank in the decade ahead.  If the Bank can make progress in this area, however, the payoff for the institution could be large.  In addition, by modeling openness and an ability to listen, the Bank would be putting indirect pressure on governments around the world to do the same.  If regular people are able to comment on and even contribute to the design of World Bank projects, they are surely going to begin demanding the same treatment from their own governments.  The resulting increase in citizen voice and government responsiveness could end up having a far more important impact than any particular Bank project(s).

Zoellick has assembled a solid team to help the Bank remake itself.  Sanjay Pradhan, Randi Ryterman, Aleem Walji, and others are helping lead a conversation within the Bank on ways to cultivate new thinking and approaches. As the NY Times article notes, significant culture change is going to be required, and that is  always tough.  And change will also demand hard thinking about the World Bank's business model, which currently relies on generating a spread on its loans and other financial instruments.  Incentives within the institution remain tied to the ability of staff to make loans and help the institution generate the income that it needs to operate.

The good news is that the best staff at the World Bank are leading the way.  A while back, some of my former colleagues hosted an informal all-day Saturday session for health officials in a Latin American country.  No ties were allowed, and there was no rigid agenda.  When I told one of the Bank conveners that I was sorry he had to work on a Saturday, he told me that it was one of the most productive days of his career. "For once, we did not give them a long lecture," he told me.  "We just served them pizza and kept the conversation headed in the right direction, injecting bits of information but not pressing my own views too hard."

As a result, the health officials swapped stories about what was working and what wasn't in their country.  They were able to be candid about their failures as well as their successes.  The conversation was not about What is the RIGHT ANSWER? Rather, it was about What are some reasonable things to try in our country, and how can we best evaluate the results? The participants liked the experience so much that one of the officials present hosted a similar session, with Bank help, for other countries in the region. The effort led to a great deal of social capital that allowed successes and failures to be honestly shared, thereby speeding experimentation and improving feedback loops.

My friend told me he felt he had helped advance reform more on that single day than in months of formal meetings and expert presentations.  Instead of being a Bank expert pushing for the RIGHT policy, he was helping a country's own experts iterate toward an approach that would work in their context. Furthermore, the trust and social capital that emanated from these meetings led the countries involved to seek several hundred million dollars of funding from the Bank to support their reform agendas.  The revenue from these loans in turn enable the Bank staff to provide additional intellectual support, including hosting more conversations.