1. Module on Operations Review: Scope, Process, and Tools

2. Module Guideline  Intended users: External and/or Internal Evaluators –MABS Service Provider Consultants –Bank’s Senior and middle management, MF supervisors, and Market Research and Product Development group, if any.  Course Objectives –Learn the scope and process of operations review –Learn the tools to use –Apply the tools and prepare operations review report

3. Objectives of Operations Review  Assess product performance: Actual vs. Targets  Review compliance to policies and procedures through –loan documentation review of folders –Interviews with staff  Review product design and policies  Assess client satisfaction  Identify operational areas of strengths and for improvement  Recommend what are needed to improve product acceptance and operations.

4. Scope of Review  Assess Product Performance –Performance versus Targets –Performance Trends –Profitability –Operational Efficiency  Review Product Design and Loan Policies –Pricing and competitiveness –Mandatory savings policies –Loan amount, payment frequency –Service delivery

5. Scope…  Review Compliance to Policies and Procedures and loan documentation –Actual practices versus the product manual –Adequacy of internal control –Zero tolerance practices

6. Scope …  Assess adequacy of organizational structure for expansion, continuing capacity building  Evaluate MIS capability.

7. The Process Operations review involves a 3-stage process: 1. Pre-bank visit preparation  Analyze MF portfolio in relation to bank-wide portfolio – reviewer must request for bank’s FS to get:  Ratio of MF borrowers to total  Ratio of MF portfolio to total  Gross and net MF income contribution to total  MIS reports analysis, looking MF trends over the period under review; construction of charts  Organizational set up for MF operation in relation to bank-wide organizational structure

8. The Process 2. In the bank/on the field:  Interviews: management, BMs, product head  Focus group discussion with Account Officers  Credit files review – sample 5 accounts recently released; 3 delinquent accounts  Get Client feedback –Visit and interview individual clients (preferably those sampled accounts) –Client satisfaction through focus group discussions –Exit survey (clients who left within last 6 months)  Exit conference with senior and middle management - Written highlights of findings and recommendations are discussed and submitted during exit conference

9. The Process and Tools…. 3. Post-field activities  Final report writing  Full report submitted within a week after the exit conference

10. FGD, Exit Survey and Other Tools: A Walk Through of Handouts (HO)  HO 1: Interview Guide for Delinquent Clients  HO 2: Client Exit Interview Questionnaire  HO 3: Client FGD Guide  HO 4: Document Audit Form  HO 5: Checklist for Review of Compliance to Policies and Procedures Note: B6- Operations Review Report template shows a guide outline on preparing the report.

11. Field Practicum of Course Participants  Is arranged before hand with the nearest and willing MABS participating bank  Scheduled activities are for 1 to 1.5 days, with overnight stay, if any, also arranged before hand  Process field experience with course participants :  their insights and learning  the processes and tools that they find most helpful  the processes and tools they had difficulty using and/or need clarifications.

12. HAVE FUN DURING THE FIELD PRACTICUM! The End