Decision Making in Practice Case Study of Aceh-Nias Recovery Universitas Syiah Kuala Banda Aceh, 03 September 2008

“Somewhere along the line of development, we discover WHAT IS DECISION MAKING? “Somewhere along the line of development, we discover what we really are, and then we make our real decision for which we are responsible.” Eleanor Roosevelt First Lady of the United States (1933 - 1945) President and Chair of the United Nations Commission on Human Rights (1946 - 1952) Other standard definitions Identifying and choosing alternatives based on the values and preferences Reducing uncertainty and doubt to allow a reasonable choice Using information as much as possible to minimize risks Etc.

+ WHAT ARE INVOLVED IN DECISION MAKING? Pre-Decision Making Uncertainties ~ Risks Pre-Decision Making Decision Making Post-Decision Making Decision goals and criteria Set of decision alternatives Relevant principles and values Available information Rational evaluation/ analysis Judgment/ intuition Consequences Results +

RECOVERY OF ACEH AND NIAS STARTED WITH THIS

THE GOAL: RECOVER FROM THE UNPRECEDENTED DAMAGE More than 800 kilometer coastal line hit, longer than the distance from London to Glasgow or from San Francisco to San Diego, with devastation reached 1-6 kilometer in-land. REPUBLIC OF INDONESIA Damage assessment 800 km x 1-6 km destroyed! 120.000 Houses destroyed 70.000 Houses damaged 14 Sea ports 120 Bridges 3.000 km Roads 1.052 Government buildings 2.000 School buildings 114 Health centers 20.000 ha Fish ponds 60.000 ha Agriculture land 100.000 SMEs 167.228 Students lost their schools 2.500 Teachers died Jakarta Surabaya 760km Medan Jambi 850 km

THERE ARE ALTERNATIVES ON HOW TO PLAN AND DO RECONSTRUCTION… Definition Sequential Reconstruction is done sector by sector based on normal sequence in a regional development Illustration: Paddy fields Housing Road Schools Etc. Parallel Reconstruction is done with all sectors being addressed at the same time Illustration: Housing Road Paddy fields Etc.

…EACH WITH ITS IMPLICATIONS Positive implication Risks Sequential Easy to manage and coordinate projects Simple planning Cost efficiency Long and lengthy process Social unrest as tsunami survivors have to wait long Parallel Fast revival of every aspect of community life Maximum leverage of immediate assistance coming from outside Aceh/Indonesia Complicated and continuous planning Potential overlaps leading to extra costs

CAN WE ADDRESS THIS SITUATION WITH SEQUENTIAL APPROACH?

CAN WE ADDRESS THIS SITUATION WITH SEQUENTIAL APPROACH? June 2007 December 2005 June 2007 December 2005 CAN WE ADDRESS THIS SITUATION WITH SEQUENTIAL APPROACH?

Choosing the best alternative is as easy as calculating: IF ONLY WE WERE FULLY RATIONAL AND SO WAS OUR ENVIRONMENT … For all decision strategies… 1. OPTIMIZING = to find the alternative resulting in optimum output 2. SATISFYING = to find the alternative resulting in satisfactory output 3. MAXIMAX = to find the alternative resulting in maximum output among the maximum options 4. MAXIMIN = to find the alternative resulting in maximum output among the minimum options Choosing the best alternative is as easy as calculating: Probability x Expected Value

HOW TO MANAGE UNCERTAINTY …BUT WE LIVE IN A NON-RATIONAL AND NON-IDEAL WORLD Rational/Ideal situation Actual situation Decision maker is logical and rational Problem is perfectly defined All criteria is identified clearly All information is available and accurate All relevant alternatives are available Assessment and evaluation can be done easily Decision maker has biases and uses intuition Problem is sometimes unclear Criteria is complicated Information is incomplete Relevant alternatives are not exhaustive Rationality is bounded HOW TO MANAGE UNCERTAINTY ? GAP!

GUNUNGSITOLI HOSPITAL, NIAS

GOAL OF ACEH AND NIAS RECOVERY WAS CLEARLY SET After the humanitarian phase came the massive job of emergency reconstruction. The President decided to create a single agency to lead and manage the process – one of the best decisions that could ever have been taken. I was appointed to lead this agency. We call it BRR for short. Its core roles are to: Restore livelihoods and strengthen communities Facilitate and coordinate partner programs, and Coordinate and implement government projects Our mandate runs for four years to end April 2009. So we are just over half way through. The clock is ticking and we have a long way to go yet. “…we will rebuild Aceh and Nias. And we will rebuild it back better.” Susilo Bambang Yudhoyono The President of Republic of Indonesia This goal is elaborated as the guiding principles of both emergency relief and reconstruction periods

military operation for non-military purpose DESPITE THE LONG-LASTING CONFLICT, PRESIDENT SBY TOOK RISK AND DECIDED TO “OPEN” ACEH Biggest military operation for non-military purpose. National support International support 5.465 Volunteers 124 Medical team 11.800 Paramedical personnel 493 Heavy equipments 6.000 Military personnel 34 Countries 16.000 Personnel 117 Medical team 9 Mother ship 1 Floating hospital 14 War ship 31 Aircraft 82 Helicopter Biggest military operation for non-military purpose In the last 50 years

THE DECISION RESULTED IN A GREATLY SUCCESSFUL RELIEF EFFORT WITH NO DEATH FROM STARVATION OR DISEASE

AFTER RELIEF, RECONSTRUCTION PERIOD FOLLOWS WITH HUGE FUNDS INVOLVED 6.1 AFTER RELIEF, RECONSTRUCTION PERIOD FOLLOWS WITH HUGE FUNDS INVOLVED GLOBAL RESPONSE ON 2004 TSUNAMI* Damage assessment Build back Pledged Total Fund – Aceh and Nias USD Billion 4.9 7.1 The largest international response to a natural disaster The largest private response, but not the largest official response The largest number of donors (state and private) and implementing agencies The largest amount of aid per affected person The fastest financial response to a disaster Source: Tsunami Evaluation Coalition (TEC) Report 2006

PRINCIPLES OF ACCOUNTABILITY AND INTEGRITY ARE THE FOUNDATION OF TRUST BRR Integrity Pact BRR applies the integrity pact to all staffs, not only procurement related ones, and all its projects Anti-corruption unit (SAK) BRR is the first government agency to have an autonomous and independent anti- corruption unit Corruption Eradication Commission (KPK) office At BRR request, KPK established its first representative office outside Jakarta in Banda Aceh KPPN-K (treasury) BRR is the only government agency in Indonesian history to have a dedicated KPPN (national treasury) representative office Supervisory Board and Advisory Board BRR ensures its effectiveness through the existence of autonomous Supervisory and Advisory Boards

6.1 PERSISTENT EFFORT LEADS TO STRONG TRUST FROM THE INTERNATIONAL COMMUNITY Total Fund USD Billion 93% 7.1 4.9 Damage assessment Build back Pledged Committed

PRINCIPLE OF COMMUNITIES PARTICIPATION IS ENCOURAGED In such a completely devastated area, where no single documentation on people’s property left behind, consensus building among the community is key. People discuss where the boundaries of their land were, where the new public facilities will be located, and eventually agree on a new village map. The map will then serve as the only basis for issuing official documentation like land certificate. Village planning ~ community participation at its best

Houses built 6 months later, but eventually the property market value COMMUNITIES DECIDE IF THEIR AREA WILL BE REBUILT WITH NEW LAND CONSOLIDATION OR KEPT AS IT WAS In some areas, we can see neighboring villages like this. The first one at the upper part of the picture chose to have houses built as soon as possible and did not want to do the consensus building first, rather they asked for houses built on the same spot as they were. The other village did the village mapping first and got their houses 6 months later than the neighbor. But as the village is more neat and has better facilities, making the first village to envy but that’s too late. As a matter of fact, eventually the market value of the property on the village below is higher by 2 or 3 times higher. AS IT WAS NEW LAND CONSOLIDATION Houses built 6 months later, but eventually the property market value reaches 2-3 times higher

+ NOW IMAGINE YOU MAKE IMPORTANT DECISIONS AS DOCTOR OR PSYCHOLOGIST Uncertainties ~ Risks Pre-Decision Making Decision Making Post-Decision Making Decision goals and criteria Relevant principles and values Available information Set of decision alternatives Rational evaluation/ analysis Judgment/ intuition Consequences Results +

PROGRESS HIGHLIGHTS IN PICTURES

THREE AND A HALF YEARS OF BUILDING BACK BETTER Damage/Needs (early estimates) Progress (as of July 2008) New houses 120,000 unit 114,281 unit Agricultural land 60,000 ha 96,819 ha Road 3,000 km 2,596 km Seaports 14 19 Airports/airstrips 11 12 Teachers 2,500 died 26,538 attended trainings Schools 2,006 unit 1,090 unit Health facilities 127 unit 810 unit Religious facilities 3,183 unit 1,649 unit

TRAFFIC JAM IN BANDA ACEH

REVIVAL OF SMALL MEDIUM ENTERPRISES (SMEs)

GRAND HARVEST

PLANTATION PROGRAM FOR EX-COMBATANT TSUNAMI SURVIVORS

MALAHAYATI SEAPORT

OCEAN FISHING PORT – LAMPULO, BANDA ACEH

DAILY LIFE IN RELOCATION COMPLEX

TERIMA KASIH 谢谢. Danke. Thank you Gracias. شكرا . Tesekkürler Merci. ありがとう. Dank u 당신을 감사하십시오