1. Conditional Grant Business Plan Training Process
National Treasury
August 2007
DAY - ONE
Technical Assistance Unit

2. Objectives
Understanding of broad policy framework governing Conditional Grants
Understand alignment of Budget Cycle and Conditional Grant Cycle
Understand the application and use of the RBM in the preparation of business plans
Develop business plans (draft) as a learning process

3. Two Day Agenda DAY One DORA requirements
Budget cycle, Conditional Grant Cycle and Alignment Model (where relevant)
Introduction to RBM concepts and terminology
DAY two
Develop business plans as a learning process focusing on:
Logic model – Grant Profile
Performance Measurement Framework
Risk Management Plan

4. Learning approach Lectures To share essential concepts.
Group Exercises
Learn by doing – test our ability to apply our knowledge to the development of actual business plans
Discussions
To link concepts to participants needs, build on participants experience and offer the opportunity to develop a support network.
Readings
Reference materials (documents and websites) will be made available to participants to pursue individual learning interests.
Feedback
This is your workshop. We would appreciate feedback so that we can better meet your interests and needs.

5. Rules of Engagement Be open to share experience, ideas, opinions
Respect ideas, opinions
Don’t be afraid to ask questions. We will either
Answer it
Park it
Refer it to the group
Research it and answer it later, in group or off-line

6. ALIGNMENT OF THE BUDGET CYCLE, CONDITIONAL GRANT CYCLE AND THE INFRASTRUCTURE DELIVERY CYCLE

7. MTEF Budget Preparation Cycle and Conditional Grant Planning Processes
31 Aug
Mid Dec
Mid Feb
Draft Budget
Update Budget
Final Budget
Budget Alloc Letter
10 x 10
MTEC
MinComBud
Cabinet
MTBPS
Budget Day
The Budget Cycle
The Budget Cycle is a 3 year cycle consisting of planning processes, implementation processes & closure processes being undertaken in each year. As mentioned earlier the budget should show how the targets and priorities set out in the 5 year Strategic Plan are going to be addressed.
In many cases budgets are not informed by the strategic plan and actual projects.
Conditional Grant Planning Processes
APPROVAL
1st draft of Business Plan for next year
Updated Business Plan for next year
Finalising the Grant Framework for DoRA Requirements
Legend:
Input into Budget
Process Linkages

8. Alignment of the MTEF Budget Cycle and the Conditional Grant Cycle
Draft Budget
Update Budget
Final Budget
Implement Budget
AFS AR
Draft Budget
Update Budget
Final Budget
Implement Budget
AFS
Draft Budget
Update Budget
Final Budget
Implement Budget
Grant Initiation
Grant Formulation & Approval
Level 1 Approval: CG approved for coming yr
Implementa-tion
Planning
Year 1:
Implementation,
Monitoring & Reporting
Business Plan for Year 2
Year 2:
Implementation,
Monitoring & Reporting
The Budget Cycle
The Budget Cycle is a 3 year cycle consisting of planning processes, implementation processes & closure processes being undertaken in each year. As mentioned earlier the budget should show how the targets and priorities set out in the 5 year Strategic Plan are going to be addressed.
In many cases budgets are not informed by the strategic plan and actual projects.
Business Plan for Year 3
Legend:
Input into Budget
Process Linkages
Budget Allocation

9. Infrastructure Planning Processes
The Budget Cycle
The Budget Cycle is a 3 year cycle consisting of planning processes, implementation processes & closure processes being undertaken in each year. As mentioned earlier the budget should show how the targets and priorities set out in the 5 year Strategic Plan are going to be addressed.
In many cases budgets are not informed by the strategic plan and actual projects.

10. In the case where a Conditional Grant contains infrastructure the Infrastructure Delivery Cycle must be taken into consideration
Draft Budget
Update Budget
Final Budget
Implement Budget
AFS AR
Draft Budget
Update Budget
Final Budget
Implement Budget
AFS
Draft Budget
Update Budget
Final Budget
Implement Budget
Grant Initiation
Grant Formulation & Approval
Level 1 Approval: CG approved for coming yr
Implementa-tion
Planning
Year 1:
Implementation,
Monitoring & Reporting
Business Plan for Year 2
Year 2:
Implementation,
Monitoring & Reporting
The Budget Cycle
The Budget Cycle is a 3 year cycle consisting of planning processes, implementation processes & closure processes being undertaken in each year. As mentioned earlier the budget should show how the targets and priorities set out in the 5 year Strategic Plan are going to be addressed.
In many cases budgets are not informed by the strategic plan and actual projects.
Business Plan for Year 3
Project
Implementation
Infrastructure Planning
Programme Design
Project
Design
Project
Tender
Legend:
Input into Budget
Process Linkages
Budget Allocation

11. INTRODUCTION TO RESULTS BASED MANAGEMENT OR PERFORMANCE MANAGEMENT

12. Some Key Questions
How does the cumulative impact of long term initiatives get measured and reported?
What is the contribution of the work being done in terms of the strategic goal?
How can progress be measured and reported?
Who needs to get such reports?
Is government getting value for its money?
How can interdependencies be managed?
Can a shared understanding of service delivery be generated?

13. What is Results-based Management
Is a comprehensive approach to public management based on a client\taxpayer\citizen-centred view
It focuses on external results (outcomes) rather than on internal processes to drive change
It integrates strategy resources, performance, measurement, learning and adjusting to improve decision making
Results information is used for learning and decisions making as well as reporting and accountability

14. Why results-based management (2)
The expected benefits are better responses to client\taxpayer\citizen expectations, particularly with regard to value for money
It puts considerable emphasis on defining and achieving results and development and improvement
It facilitates an integrated and coherent approach to public management with improved accountability
Management for results and not by results – is the key through arrangement of resources to achieve the outcomes

15. RBM Elements & Solutions
Results Based Management assists in setting the stage to answer these and other questions
Key elements include;
The building in of a useful approach from the beginning of the strategic process;
A focus on the results to be achieved; and
Ongoing and continuous management over time and up and down the public sector hierarchy.

16. Importance in SA?
Government Wide Monitoring and Evaluation System (GWM&E)
Framework for Managing Programme Performance Information (PIF)
Both initiatives are using RBM principles, emphasis is on:
Accountability and achieving results
Meeting stakeholder expectations
Ensuring Value for money

17. RBM Cycle
Programme Management
Influence and
Project Management
NT TAU

18. RBM Management Framework
Impact
Manage/influence to
achieve these
Outcomes
(change in behaviour)
Outputs
Project Manage & Budget for these
Activities
Inputs
(deliverables)

19. RBM Performance Framework
Impact
Indicator
There need to be indicators of performance at all levels
Outcomes
Indicator
Outputs
Indicator
Activities
Indicator
Inputs
Indicator

20. RMB Logical Framework Impact Outcomes Outputs Activities Inputs
Assumptions
Outcomes
Assumptions
Outputs
Assumptions
Assumptions hold true
Activities
THEN
AND
Inputs IF

21. Managing for Results - Principles
Focus the dialogue on results at all phases of the (Programmes & Projects) development process
Align programming, monitoring, and evaluation with results
Keep results measurement and reporting as simple, cost-effective, and user friendly as possible
Manage for, not by, results, by arranging resources to achieve outcomes
Use results information for learning and decision making as well as reporting and accountability

22. Moving from a Focus on Outputs to a Focus on Outcomes
Previous Focus
How we know how well are we doing
What we use
to do the work
What we do
What we
produce
Who we impact
REACH
INPUT
ACTIVITIES
OUTPUTS
OUTCOMES
What we wish to achieve
WHAT ? HOW ?
WHO?
WHY?
New Focus
Moving from a Focus on Outputs to a Focus on Outcomes

23. Results-Based Management: Linking Programmes to Strategic Objectives
Emphasises strategic alignment of effort towards results objectives – linking programmes to strategic objectives
Strategic Plan
Operational Planning Process
Reporting Process
Planning Process
UI suggest that we speak to this slide to make the point that the different planning levels need to be connected and are cascading downwards from the strategic plan, taking their direction form the strategic plan and roll up in terms of identified and clearly articulated and measurable accountabilities at each level.
Operational Plan
Unit Work Plan
Employee Work Plan

24. How this is applied in SA

25. Focusing on Results helps…
Departments to understand the difference made by their programmes to the communities they serve
Departments have increased transparency and accountability
Departments to better allocate resources and better design/adapt programmes and services to the needs of the people
Using RBM as a management tool,
Department will be in a position to learn and improve their programmes and service delivery

26. Some tools ‘assimilated’ by RBM
Plans
State of the Nation address, Budget speech
Department's strategic plans and operational plans
Performance measurement/monitoring systems
GWM&E
PIF
Control system
Performance audit
HR engagement and accountability
Performance agreements
Published public service standards (Batho Pele)
Programme/Project Design
Logic model (results chain); Logical Analysis Framework (logframe);
Results based management frameworks
Risk based and audit framework

27. What you need to focus on!!!
Change management
Risk management
Performance management and reporting

28. Change Management Necessary to minimise negative impact due to transition
Benefits of good change management
Performance
Time
New level of performance
Old level of performance
Initial impact of change is a decrease in productivity.

29. Why manage risk?
Fundamental responsibility of (public service) management!
Management decisions are generally made in a context of uncertainty.
RBM emphasis on accountability in the pursuit of results requires a thorough identification and understanding of risk in order to have the appropriate control system in place.
A proactive stance in risk management not only minimises probability and incidence of undesirable events, it also fosters innovation.
‘Risk is no longer something to be faced; risk has become a set of opportunities open to choice.’
Peter L. Bernstein, Against the Gods

30. RBM and Risk
Risk is the uncertainty that surrounds future events & outcomes. It is a function of the probability and the impact of an event that has the potential to (negatively) influence the realisation of the organisation’s expected results. Risk increases over time, as, in a dynamic environment, numerous variables come into play, many not under any one individual or organisation’s control.
Source: CIDA web site

31. Performance measurement Is all about…
Why does the project, programme exist?
What do we want to accomplish?
How are going to deliver the programme?
How will we know how well we are doing?
What changes do we make to improve the delivery of the programme?

32. What outcomes & impact we wish to achieve.
Project Framework
Typical Focus
RBM Focus
Outcome
Who is reached
Input
Output
Activity
What we use
to do the work
What we do
What we
produce
What outcomes & impact we wish to achieve.
Who Benefits
Performance Measures
Indicators, baselines and targets

33. The RBM cycle – Not a linear sequence!
Commit
feedback, adjust
Implement
Control
feedback, adjust
feedback, adjust
Report
Improve

34. Introduction to RBM concepts and terminology

35. Activities vs. Outputs vs. Outcomes
“what we do”
Describes a collection of functions (actions, jobs, tasks) that consume inputs/resources and whose outputs deliver benefits/impacts to a client.
Outputs
“what we produce”
The direct products and services generated through processes or activities.
Outcomes
“why we do it”
The effects, benefits or consequences (impacts) that occur (either in the short, intermediate, or long-term) due to the outputs of programs, processes or activities.
In summary, every Program undertakes Activities that produce Outputs that contribute to the achievement of Outcomes.

36. Examples of Activities
Activities “what we do”
Describes a collection of functions (actions, jobs, tasks) that consume inputs/ resources and whose outputs deliver benefits/impacts to a client.
Conduct research
Publish documents
Provide advice
Contract for services
Respond to enquiries
Draft the business plan
Organize Committee meetings
Organize Committee travel
Note that Activities contain verbs

37. Examples of Outputs Research papers Advice and direction
Outputs “what we produce”
The direct products and services generated through processes or activities without specific reference to their ultimate purpose.
Research papers
Advice and direction
Service providers obtained and work initiated
Business plan
Committee reports
Note that Outputs contain nouns

38. Examples of Outcomes A secure work environment
Outcomes “why we do it”
The effects, benefits or consequences (impacts) that occur (either in the short, intermediate, or long-term) due to the outputs of programs, processes or activities.
A secure work environment
Electronic accessibility and equality
Sound management practices (accountability and reporting framework, people management, internal communications, technology support)
Representative workforce
Note that Outcomes refer to a changed state of being and are stated in the present tense.

39. Key Issues to consider when identifying outcomes
Are there stated national /sectoral goals
Have political promises been made that specify improved performance of the government
Do citizens, polling data indicate specific concerns
Is authorizing legislation present
Other; Millennium Development Goals (MDGs), PoA Objectives

40. Indicators, Standards/Targets
Indicators ( The “How”)
A quantitative or qualitative attribute, statistic or parameter that, tracked over time, provides information on the condition of a phenomenon.
(e.g. percentage of clients that are satisfied).
Standards/Targets (The “How Much”)
Specific quantitative or qualitative goals associated with specific performance indicators (e.g. 90% client satisfaction).
Standards imply product and service levels to which an organization is prepared to commit.
Targets imply a desired goal that may be more ambitious than a standard.
In summary, Indicators, Standards and Targets are used to provide information on how efficiently and effectively the Program is being managed.

41. Examples of Indicators
Indicators “the how”
A quantitative or qualitative attribute, statistic or parameter that, tracked over time, provides information on the condition of a phenomenon
Cost per unit published
% of total workforce leaving the organization
Time (hours) to respond to a request for service
Level of satisfaction of service users/ providers

42. Examples of Standards/Targets
Standards/Targets (the “How Much”)
Specific quantitative or qualitative goals against which actual outputs or outcomes will be compared
60% of South Africans are aware of housing subsidies opportunities
Training cost per new employee is $2,000
85% of workforce is satisfied with working conditions, quality of life
99% availability of IT networks

43. Exercise Number 1 RBM Language

44. Results Chain
RESULTS
High Control
Low Influence
STRATEGIC
OUTCOMES
INPUTS
(RESOURCES)
ACTIVITIES
OUTPUTS
OUTCOMES
(IMMEDIATE)
OUTCOMES
(INTERMEDIATE)
OUTCOMES
(FINAL)
A Results Chain can include multiple inputs, activities, outputs or outcomes. There are two types of Results: Outputs and Outcomes.

45. RBM Line of Sight

46. Exercise Number 2 Outcomes

47. Exercise Number 3 Identifying indicators related to the Logic Model

48. Brief Summary
RBM goes beyond the work we do – it interrogates the impact this has.
There is a hierarchical relationship between outputs and outcomes.
Each level of this logic must and can be measured.
Measurements used for management and reporting.
Indicators are not the same up the hierarchy.