using proxy indicators, it is important to ensure that the proxy is giving at least approximate evidenceon the per<strong>for</strong>mance.Pre-designed indicatorsWhen indicators are constructed independently of the context of an individual country, sector,organization, project/program/policy, the indicators are known as pre-designed indicators. A numberof international development organizations may construct indicators to track development changes.Examples of pre-designed indicators include the Millennium Development Goals (MDGs), the UnitedNations Development Program’s (UNDP’s) Sustainable Human Development Goals, The World Bank’sRural Development Indicator, and the International Monetary Fund’s (IMF’s) Financial SoundnessIndicators.MDGs contain eight goals, with corresponding targets and indicators assigned to each. UNDPestablished the Human Development Index (HDI) in 1990 to measure the quality of life in all countries.The World Bank’s Rural Development indicator contains indicators <strong>for</strong> rural wellbeing, improvementsin the rural economy, development of rural markets, and others. The IMF uses indicators of financialsoundness.The advantages of using pre-designed indicators include possibility to aggregate across similar projects/programs/policies and possibility to make cross-country comparisons. The disadvantages of using predesignedindicators include difficulty to address country specific goals, top–down nature and lack ofstakeholder participation. It is important to note that pre-designed indicators may not be relevant to agiven country or organizational context.6.3 Constructing indicatorsIndicators determine the type of in<strong>for</strong>mation to be collected <strong>for</strong> M&E system. Indicator constructionneeds time and should be done with care and in a participatory manner. It should be done bycompetent personnel who have expertise in the issues covered by the M&E system. Indicators have to beconstructed to meet specific needs. Since the objective is to achieve measurement of the results chain,indicators should reflect each element of the results chain. Although indicators should be identifiedacross the per<strong>for</strong>mance framework, from resources through ultimate outcome, it should be noted thatRBM emphasizes measuring achievement of results more than the use of resources (CIDA 1999).Indicator selection <strong>guide</strong>s the subsequent operation by indicating what in<strong>for</strong>mation/data to look <strong>for</strong>. Ifwe do not assess the issue with the right measurement, we may not be able to get the right in<strong>for</strong>mationneeded. There<strong>for</strong>e, it is good to ask the right question <strong>for</strong> each of the issues selected <strong>for</strong> M&E.Stakeholder participation in selecting indicators helps the incorporation of stakeholders’ interests andconcerns, and improves the usability of M&E in<strong>for</strong>mation. There<strong>for</strong>e, it is important to distil stakeholders’interests into good, usable indicators. Thus, the different level of results should be disaggregated tomake sure that indicators are relevant across the concerns of different stakeholder groups and not just<strong>for</strong> a single stakeholder group. It is important to be thoughtful about the number of indicators chosen,because each indicator will need data collection, analysis, and reporting system behind it. Monitoringtoo many indicators, given the limited capacity to do so, is difficult and decreases the quality of theM&E in<strong>for</strong>mation. Moreover, too many indicators can also negatively affect the response rate. It alsogets in the way of the ‘real’ work of implementation and complicates things. There<strong>for</strong>e, it is veryimportant to reduce the number of indicators to the minimum necessary that meet key management,36
learning, reporting and decision-making needs. In addition to reducing the number of indicators, thefrequency, and level of detail can also be reduced to ensure manageable size of indicators. In general,it is good to include only the in<strong>for</strong>mation required to improve decision-making. This calls <strong>for</strong> theregular revisiting of the indicators selected <strong>for</strong> monitoring.Although indicators can be adopted or even dropped, dropping or modifying indicators should be donewith caution and consultations. When indicators are changing, baselines against which to measurechange or progress also needs to be changed. In order to minimize revision, indicators should bethought through carefully when they are first established.37