1. Performance Measurement an Management of PACA and LED: The Compass of Local Competitiveness Jörg Meyer-Stamer jms@mesopartner.com

2. Principles of monitoring and evaluation Define objectives, milestones and indicators at the beginning of any LED activity Define responsibility for monitoring and evaluation Involve the people involved in the project in definition of criteria, and in monitoring and evaluation

3. Some options regarding participatory evaluation monitoring through networking, transparency (website) external evaluation: local university students as evaluators –opportunity for practically relevant thesis self-evaluation –organise evaluation events with participants in given intervention use Compass of Local Competitiveness

4. Financial perspective Learning and growth perspective Customers’ perspective Internal business processes perspective A methodology for monitoring and evaluation: The Balanced Scorecard approach

5. Key ideas involved in Balanced Scorecard (1) BSC is not an ex-post evaluation tool, but a performance management tool –it forces actors to agree on goals and priorities You allow no more than 3 - 4 Critical Success Factors (CSF) per quadrant You allow no more than 2 - 3 Key Performance Indicators (KPI) per CSF –BSC creates a concurrent process of action and of reflection, leading to adjustment

6. Key ideas involved in Balanced Scorecard (2) BSC is organised in a hierarchically structured way –a top-level BSC at a programme / policy level –more specific BSCs for initiatives that feed into the programme –even more specific BSCs for individual projects and interventions

7. Economic impact: * business retention * creation of jobs and income * generation of start-ups LED learning: * LED skills accumulation * alignment of goals and objectives * systematic M+E External perspective: * distinctive locational profile * improved locational marketing * better standing with funders * stakeholder relationships LED Process: * competent public service * membership-driven Chamber and business associations * effective communication between key players Adapting the Balanced Scorecard to PACA The Compass of Local Competitiveness: An Example

8. The three possible levels of the Compass Territory PACA (local) Compass Local sub- sector A Compass Local sub- sector B Compass Local cluster C Compass Project 1 Compass Project 2 Compass Regional value chain PACA balanced scorecard Value chain project A Compass Value chain project B Compass Project 1 Compass Project 2 Compass Local government LED Compass Demanding exercise Very straightforward exercise

9. Economic impact: * business retention * creation of jobs and income * generation of start-ups LED learning: * LED skills accumulation * alignment of goals and objectives * systematic M+E External perspective: * distinctive locational profile * improved locational marketing * better standing with funders * stakeholder relationships LED Process: * competent public service * membership-driven Chamber and business associations * effective communication between key players Possible quick-wins with PACA

10. Economic impact: * business retention * creation of jobs and income * generation of start-ups LED learning: * LED skills accumulation * alignment of goals and objectives * systematic M+E External perspective: * distinctive locational profile * improved locational marketing * better standing with funders * stakeholder relationship LED Process: * competent public service * membership-driven Chamber and business associations * effective communication between key players The Compass of Local Competitiveness for the PACA locality

11. Context and purpose Assess the overall progress and impact of a PACA Project or another LED initiative Create an occasion to discuss goals and achieve goal alignment –define indicators for each of the four quadrants in a participatory way define critical success factors (CSFs) define key performance indicators (KPIs) Create an occasion for exchange of experience between different subsector / cluster / value chain initiatives.

12. How to do it practically? Top-level workshop Workshop during first PACA follow-up Repeat the scoring exercise on a bi-monthly basis Start to collect hard data on OVIs as they become available.

14. Sequence of activities in a Compass Workshop 1Framing: What exactly are we talking about? 2Look back: What have we achieved so far? 3Visioning: What are the overall objectives of the object of the Compass? 4Define Critical Success Factors –organise CSFs into four quadrants –prioritise them (Pareto) 5Option 1: Define 2 - 3 KPIs for each CSF –obtain a first score for each indicator 6Option 2: Go directly into definition of activities to address CSFs (with participants with little experience in formulation of indicators

15. Economic impact: * business growth * level of investment, rate of return * creation of jobs and income Innovation and learning: * understanding the 5 forces * skills development * R&D * linkages with support orgs. * market intelligence Customers’ perspective: * what are the CSFs in creating and maintaining customer interest (price, quality, timely delivery, brand, lifestyle,...) Business Process: * productivity, quality, design, upstream and downstream, technology, market channels, flexibility, responsiveness, compliance with standards,... A possible Cluster / value chain / subsector PACA Compass

16. Economic impact: * value chain integration * product diversification * market-driven demand * availability of funding Knowledge and learning: * effective transfer of skills * extension * market analysis * capacity building in quality control Relationship: * access to agricultural product markets * partnership btw. commercial and emerging farmers * coop. public/private sector Internal organisation: * land reform * agri BEE objectives internalised * effective process management The Ilembe Agriprocessing Compass

17. Context and purpose Assess the overall progress and impact of a value chain / cluster / subsector initiative Create an occasion to discuss goals and achieve goal alignment –define indicators for each of the four quadrants in a participatory way define critical success factors define key performance indicators –more customer-focused exercise Create an occasion for interaction between private and public sector

18. How to do it practically? Workshop during first PACA follow-up Repeat the scoring exercise on a monthly or bi- monthly basis Start to collect hard data as they become available

19. Some lessons learnt in Ilembe pilot exercise (October 2004), 1 Crucial to exactly define what the Compass is about (limits of the system, insider / outsider, territory, sector / value chain, LED / local development at large) Build in iterations to check wording and alignment of understanding

20. Some lessons learnt in Ilembe pilot exercise (October 2004), 2 The exercise involves an assessment of the overall strategy -- to the surprise of the participants –in locations with incipient LED activities, a Compass workshop is a possible alternative to an “LED Awareness Workshop” –Option: use Compass for strategy formulation, use Paper Computer for prioritisation The earlier you can introduce the Compass in an LED initiative, the better (baseline data)

21. Thank you for your attention!