The Matrix System at Work - Independent Evaluation Group - World ...

CHAPTER 1
INTRODUCTION AND CONTEXT
Departments increased from 20 to 45, with almost 90 percent of country directors based
in-country by fiscal year (FY) 2010, compared to 5 percent in 1997. Increasing numbers
of sector staff are also co-located with the country director.
1.15 The 1997 reforms were accompanied by a Strategic Compact with the Bank’s
shareholders, who approved an incremental $250 million for organizational renewal
over 30 months. The main purpose was that in return for a short-term restructuring
investment, the Bank would be reorganized in a way that would provide cost savings
and improved output to achieve greater effectiveness in its development goals (World
Bank 1997c; Phillips 2009: 38). The four priority areas were:
Refueling current business activity to ensure resource allocation to front-line
services (which had been cut 13 percent over the previous three years) to protect
the level and quality of client services.
Refocusing the development agenda on social and environmental sustainability,
governance, and partnership with the private sector.
Retooling the Bank’s knowledge base through establishment of the sector
networks and the capacity-building work of the Economic Development
Institute (now renamed the World Bank Institute or WBI).
Revamping institutional capabilities through a more integrated information
system, human resource strategy, financial management system, and increasing
decentralization.
1.16 An external assessment of the Strategic Compact found the design of the
matrix to be a good one, but identified several implementation weaknesses. 7 The
regional matrix organizations lacked many of the common elements of institutional
design and procedures that led to institutional complexity and implementation
challenges. Each Region created different interfaces with the networks. For staff
crossing the Regions, there were different processes and practices to which they needed
to adjust. There was some concern that too many country directors were created,
leading to fragmentation of the budget and over-programming as the unit of
accountability became smaller. There was insufficient follow-through on organizational
design elements after the launch of the networks. Accountability for contracting and
quality assurance was not addressed and teamwork and the internal market appeared
to be working at cross-purposes. Teamwork behavior, integral to the matrix, was being
adversely affected by competition for tight budgets. Corrective actions were taken in
2001 to address these constraints, but many of the institutional and implementation
gaps identified persist.
1.17 The fundamental structure, including the regional structure put in place in
FY97 (Figure 1.1), is still intact. CMUs are responsible for client relations, preparation
of Country Assistance and Country Partnership Strategies (CASs), and allocation of the
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