Capacity Assessment for Enhancing Development
Effectiveness: Application to JICA Program Management
Yoichiro KIMATA
Researcher, Institute for International Cooperation,
Japan International Cooperation Agency (JICA)
10-5, Ichigaya Honmura-cho, Shinjuku-ku, Tokyo 162-8433, JAPANE-mail: Kimata.Yoichiro@jica.go.jp
1. Introduction: Capacity Development (CD) and Capacity Assessment (CA)Capacity development (CD) is a concept that emerged in the process of the international debate on
aid effectiveness in the 1990s. The process stemmed from the lessons learned from past experience onreforming technical cooperation (TC). One major lesson is that TC achieves micro-level outputs such as
an increased number of participants in TC programs but is short on macro-level outcomes, including
improvements in capacities and institutions needed to realize sustainable development at the national
level. Another lesson is that although TC may be successful in gap-filling inadequate facilities andtechnologies at the project level, it is ineffective in developing the capacities and institutions ofdeveloping countries as a whole.
Against this background, JICA has defined CD as “the ongoing process of enhancing the
problem-solving abilities of developing countries by taking into account all the factors at theindividual, organizational, and societal levels” (JICA
endogenous development by developing countries.

2006).

CD represents the process of

It means the enhancement of the overall

capacity of a developing country, encompassing not only individuals and organizations but also theenabling environment covering the societal, policy and institutional aspects.
Capacity Assessment (CA) is an analysis of the current country’s problem-solving abilities of
all the factors at the individual, organizational, and societal levels and their changing process, whichleads to the formulation of capacity development strategies as a communication tool among thepartner country and donors 1.
This paper reviews the international and domestic arguments of why CA is needed andanalyzes the characteristics of capacity to be assessed based on the products of JICA’s research
1

UNDP defines CA as "an analysis of current capacities against desired future capacities”. It also

explains that CA generates an understanding of capacity assets and needs which in turn leads to capacity
development strategy formulation and costing. (UNDP 2006)

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activities. It then discusses how to practice CA in managing JICA’s projects and programs and how
to reflect the results of CA in those designs.

2. Domestic and Overseas Debate on CA(1) International arguments
Capacity development (CD) regarded as one of the core issues in the Paris Declaration on Aid
Effectiveness ("Paris Declaration"), which was endorsed by over one hundred donors and developing
countries in 2005. CD is also a major topic of discussions by Development Assistance Committee(DAC) and developing countries leading up to the Third High-Level Forum on Aid Effectiveness(“HLF-III”), which will be held in Ghana in September 2008 to provide an interim review ofprogress in implementing the Paris Declaration. These discussions call on developing countries totake the driver’s seat in formulating CD strategies, donors’ alignment with these strategies,
consideration for country contexts, and the effective use of country systems and local resources.
They also stress the importance of incentives and drivers of change, as well as the significance ofknowledge management and networking in CD (Miwa

2008). These proposals all point to theimportance of enhancing the predictability of CD in developing countries by (i) establishingmedium- to long-term development strategies of the developing countries; (ii) clarifying the medium
to long term support strategies of the donors ; and (iii) mobilizing human and financial resources ofboth the developing countries and the donors.
These discussions have highlighted comprehensive CA from the perspectives of both thedeveloping countries and the donors, and consensus on what targets to establish and what kind of
support is needed to achieve them. In other words, CA is considered essential for harmonizing acountry’s development strategies and donors’ assistance strategies, which set out common CD
strategies.
(2) Domestic arguments: Reform of JICA’s project/program management
Considering the above international arguments, JICA is shifting its emphasis from stand-alone
project management to program based management aligned with the development strategies ofpartner countries. The traditional approach to project management monitoring based on Project
Cycle Management (PCM) is reaching its limits. JICA endeavors to position its assistance alignedwith the development strategy of the partner country and how to link the outcomes of its individual
project with other JICA projects or activities of other donors and the partner country itself.

It isnecessary to draw up a scenario that will lead to the impact and sustainability of a JICA project asearly as the project formulation phase. Project management should consider not only the technicalrelevance and effectiveness of a project but also factors that could possibly be regarded as“important assumptions” in the Project Design Matrix (PDM), such as the financial and institutional

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resources to support the project activities.
In this sense, the process of formulating a CD support project/program should involveassessing not only the strategies and programs of the partner country but also its framework andcapacity to implement them. This assessment is necessary for the donor and the partner country toshare the common understanding of the entry points—where the project/program should start toenhance the targeted capacities—and of the cooperation scenario.However, a single donor cannot
provide CD support that fully accommodates the strategies and programs of the partner country.
CA is essential to work closely with other donors to achieve synergy from a wider perspective.

3. Capacities to be Assessed(1) What to assess?
In the CD process as a whole, CA has three steps.
The first step is, as its definition, analysing the current organizational capacity in the partnercountry. An assessment is made of the capacity both at a given point in time and over time to trackchanges in the capacity.

The second step is the assessment of the approach to CD strategy. An assessment is made ofwhether the course of change in the capacity and the methodology applied is appropriate. The CD
scenario will be revised as necessary.
The third step is the assessment of the approach to CD support based on the revised CD
scenrio.

Although the first two steps concern the partner country, this step concerns the donor thatprovides CD support. An assessment is made of the intervention approach, or more specifically, towhat extent the amount and timing of inputs and the role and implementation framework of theintervener have contributed or constrained the CD of the partner.

(2) Basic characteristics of capacity
As discussed earlier, capacities at the individual, organizational, and institutional/societal
levels are developed as a whole through the process of interaction. Now let us take organizational
capacities, which are mostly targeted by TC.

There are two types of organizational capacity.

The first type is “technical capacity”. This includes not only the knowledge, skills and otherqualifications of individuals who form the organization, but also the tacit knowledge that isaccumulated within the organization. The second type is “core capacity”. This is the ability ofthe organization to solve its problems on its own by managing the technical capacity. In otherwords, core capacity is the fundamental capacity to produce positive outcomes. It represents thewill/commitment, leadership and management that orient the behaviors of individuals and theirorganization.

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Addressing these internal capacities alone is insufficient if the organization is to exploit its fullpotential. It is also necessary to focus on the enabling environment, including the social framework
surrounding the organization (social capital, etc.), the policy and institutional framework that
determine its capacity and its own assets (budget, infrastructure, etc.).
Not all these capacities
Core Capacity
will, commitment, awareness,
the form of organization thatmakes optimal use of its assets,management methods,
leadershipare conspicuous.
Technical
Capacity

Technical

capacities are often noticeable
becauseknowledge,
techniques,
skillsthey

show

linearchanges within a rather shortperiod of time. On the other
hand, core capacities, which

Enabling
Environment

support the development ofFormal and informal
institutions, social capital,social infrastructure, physicaland human assets

technical capacities, may not be

Effective when these capacities work as one

Figure 1.

Basic Characteristics of Capacity
Source: Author

so easy to see.

This is because

they take time to develop as thestakeholders’ awareness needs
to be raised first.

Corecapacities have the potential for significant growth when a favorable mindset is formed after thetrial-and-error process. An enabling environment may be a given condition, rather than something
to be developed easily. The development of the enabling environment, which entails a major
institutional improvement, is impossible without significant changes in technical and core capacities.
Each type of capacity has a different mode and rate of change, which should be considered inassessing current capacities and examining the scenario for improvement.

(3) CPI model
In this subsection, the characteristics of capacity are examined in relation to the outcomes of
CD. The goal of CD is to solve development issues (to reduce child and maternal mortality and to
improve literacy, for example).

To this end, a few tangible outputs (improved public healthservices, improved classes at elementary school, for instance) are set as the “project purpose” of atechnical cooperation project.
Achieving tangible outputs alone does not solve the development issues. Tangible outputs
will not last long if they are the results of gap-filling with inputs from the donor. To ensure thesustainability of such outputs, it is essential to develop the capacity of the partner country to solve
the issues on its own.
Fig. 2 charts the CD flow to the resolution of the development issues in the CPI model. In
this model, the goal or the resolution of the development issues is represented by Impact (I), the187

tangible outputs by Performance (P), and the capacity of the partner country to achieve that
performance by Capacity (C).

I

Project（Encouraging CD）

ImpactEnvironmentP

Performance

Engaging a wider rangeof stakeholders

Resources

Environment
Establishment of on
incentive mechanism

C Capacity
Resources

Environment

External inputs for CD (financial andhuman resources)

Social, cultural, and internal factorsthat promote (or hinder) CD

Figure 2. Conceptual Diagram of the Basic CPI Model
Source: Author

Establishing the flow from C to P and from P to I requires not only enhancing technical andcore capacities, but also addressing the enabling environment in the partner country.

This may

involve encouraging actions by stakeholders other than the organization and promoting policy andinstitutional changes. Management for internalizing the enabling environment is required at eachstage of the C-P-I scenario.
Major measures to this end are the strategic use of funds, manpower, knowledge and other
inputs as resources (R). It is also necessary to remember that the CPI scenario and enabling
environment vary depending on the level of capacity development in the partner country.

4. CA in the Project/Program Process
The next question is how to assess the above-mentioned characteristics of capacity? Since
CD in developing countries is a medium- to long-term process, it is important to track changes incapacities over the whole project process including the implementation and evaluation stages, aswell as assessing capacities at the project formulation stage.

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(1) CA and the assistance design in the project formulation stage(1-1) Determining the desired outcomes and assessing current capacities
The first step before formulating a CD support project/program is for the CD supporter (thedonor) to recognize the partner country’s development policies or strategies at the national andsectoral levels as the desired outcomes. The next step is to identify the actors that take charge ofthe roles in implementing these policies (financing, service delivery, and others). Tools useful inthese steps have been developed.

The United States Agency for International Development hasdeveloped Policy Characteristics Analysis as a tool for assessing policies (Gustafson and Ingle
1992) and Policy Environment Mapping Techniques (See Fig.3) as a tool for assessing relationships
between the actors involved in these policies (Crosby 1992).

Figure 3. Policy Network Map: Health Sector in Boliguay
Source: Crosby (1992)

The third step is to assess the current capacities of the actors involved to play their expectedroles. It is important here that the stakeholders in the partner country as well as the donors join theassessment process so that they will be able to reconfirm their own capacities. For the third step,
the World Bank has developed a tool called the Assessment of Institutional Capacity. Using thistool, the Bank has identified the actions and actors for each policy purpose and analyzed incentives
for these actors (Berryman, S, et. al1997).

189

Murakami and Matsuoka (2007) endorse

Actor-Factor Analysis for Social Capacity Development.

They identify three factors necessary forformulating, implementing, and evaluating policies: “policy and measure”; “resource andmanagement”; and “knowledge and technology”. They analyze how much capacity the three social
actors—the government, the firms, and the citizens—have in relation to these three factors. JICA
has compiled a checklist for assessing capacities required in the sector of solid waste management(JICA 2005).

Analyzing the capacity strengths and weaknesses of each actor thus assessed in relation tointerrelationships among the actors or their relative positions makes it possible to identify the causesof capacity weaknesses in a structural manner.

(1-2) Formulating an assistance strategy
The next step to engaging the partner country’s stakeholders in analyzing the capacities ofthese actors is to define what functions of which actor should be strengthened by identifying theentry points and creating a subsequent CD scenario, which includes the efforts by the partner country
and the domain of support by the donor.

Such a scenario serves as a national or sectoraldevelopment program or a joint assistance strategy.
JICA selects a domain of support that does not overlap with those of other donors and is likely
to create synergy in designing a cooperation program. The design process involves organizational
environment analysis with the focus on the target sector and organization.

Specifically, thisanalysis may use such tools as a SWOT Analysis or Environmental Scan 2.

The cooperation

program should be designed to take advantage of strengths and compensate for weaknesses of thetargeted organization in consideration of its internal and external risks.

2

For Environmental Scan, see “MDF tool: Environmental Scan,” 2005.

190

Figure 4. NGO Environmental scan: RINCANTOR
Source: MDF (2005)

In this way, JICA can then formulate a project that will target a specified level and produce
specified outputs.

(1-3) Designing an individual project
The PCM approach is applied in designing an individual project. From a CD perspective, it
is important to clarify the position of the project within the framework of the CD support program
and to determine the scope of the project.
To define the project in a wider context is to define what the project means to each actor
involved in the project (the service delivery department, the policy department, the beneficiaries, andother actors). The next step is to determine the roles and responsibilities of the actors (as well as
the budget and implementation framework) and identify risk factors from the interrelationships
between the actors. Furthermore, it is worth constructing or envisioning a post-project scenario.
Such a scenario will make it easier for the partner country and the donor to share a common
understanding of the purposes of the project.
Placing emphasis on “impact” and “sustainability” among the five evaluation criteria in PCM thus

191

allows a clearer course of action towards CD.

(2) CA and reviewing approach to CD support during the project/program implementation
stage
CA in the project formulation stage assesses the relevance of the project from the perspectivesof a variety of stakeholders, as it is aimed at defining the project within the CD support strategy.
An important consideration here is that the period of the project formulation stage may be not belong enough to raise the awareness of the counterparts. In the sectors of local government andcommunity development, development interventions can be counterproductive unless enough time isspent to assess local norms and organizations accurately and then determine project inputs andactivities.
The project should therefore involve, at its early stages, a process in which the counterpartsand other stakeholders estimate the baselines of their own needs and capacities and develop theirown strategy for action. Placing emphasis on the ownership of the counterparts in carrying out CA
can be considered the first step in the endogenous CD process 3.
It is necessary to monitor how the capacities change as the project activities proceed. An
assessment is made of to what extent the capacities of the target actors have been enhanced against
the baselines estimated in the project formulation stage.
strengthens counterparts’ technical capacities.

It is necessary to assess to what extent TC

The difficulty here is that they may consider that

their capacities have declined from the self-estimated baselines. However, lower self-evaluation isinterpreted as the result of the counterparts being able to broaden their horizons and assess theircapacities from a wider perspective as a result of TC.

This change reflects a change in their corecapacities.
An assessment should also be made of how far the project activities have had effects beyond
the counterparts on the actors around them. In other words, it is necessary to analyze how theactors who were identified in the project design stage have come to value the project, what action
they have taken for the project, and what role they have come to play in the project.

The actors

may develop a network as necessary to address common problems while playing their own roles.
Such a development can also serve as a benchmark against which the expansion of capacity isassessed.
These perspectives of CA lead not only to achievement of the project purpose but also better
contribution of project activities to CD over the medium to long term.

They also help to review

development interventions and design new project activities.
3

UNDP regards CA as “a key input into the formulation of capacity development strategy” byintegrated into the planning and programming process. (UNDP 2006)

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(3) CA and reconstruction of the CD scenario in project evaluation stage
For a CD perspective, project evaluation should place emphasis on the contribution of the
project in the whole CD scenario for the partner country as well as on the achievement of the projectin relation to the project purpose. In other words, a project that has not contributed to CD isirrelevant even if it has achieved the project purpose. Alternately, a project is relevant enough if it
has provided some kind of lessons to the CD strategy as a whole, regardless of its achievement inrelation to the project purpose.
In this respect, it is important to review the project activities against the CD support scenario
envisioned in CA at the project formulation stage. Such a review may suggest that the project
activities have become less relevant to the scenario. In that case, the partner country’s CD scenario
itself may have somehow changed over time. It is important to review the CD strategy so that thepartner country will be able to learn lessons from the project in its CD efforts over the medium tolong term and put these lessons to good use in a new CD scenario.
To this end, the significance of the project should be reexamined from the perspectives of not
only the project implementers, but also other different stakeholders, including policymakers andlocal residents involved in the project.

The results of such reexamination will inform CA at thetime of formulating a new project.

5. Important Considerations in CA for Different Types of Projects
The preceding chapter discusses CA in line with the project/program process of JICA.
reality, however, different types of cooperation are extended for different development issues.

In
This

chapter identifies important considerations in performing CA for three types of project in accordancewith the CPI model in Chapter 3.

(1) Assessment of CD support from the local community
The first type is best represented by rural development projects. In a typical project of thistype, the local government, residents and NGOs jointly carry out a pilot project to develop a ruraldevelopment model. The central government institutionalizes this model for dissemination to otherareas.
The characteristics of CD of this type suggest three important considerations in performing
CA. First, the requesting agency (the central government) does not match the implementing agency(the local government). This makes it essential to assess not only the needs of the requesting
agency, but also the needs and capacities of the local entities concerned and promote ownership bylocal stakeholders. Second, enhancing the capacities of local government alone will not result in a193

successful project. The local capacity will not be developed as a whole without the development of
the capacities of other local actors such as residents and NGOs. These characteristics make itnecessary to assess the norms, organizations, and available resources in the local community as awhole4. Third, in the case of a pilot project aimed at creating a rural development model, model
creation is the role of the central government, not the competent local government. For this reason,
it is necessary to assess the involvement of the central government in the pilot project, therelationship between the central and local governments, and the capacity to institutionalize the model.
It is also necessary to study the implementation framework and budget required to institutionalize
and disseminate it.
Upgrading quality oflife by local
development
Replicate the model to開発モデルの他地域への広
範囲な普及
national
level

Development planningin other regions

Institutionalization
Other regions
Capacity on development
planning, budgeting,
implementation

Success in model projects
at pilot sites(Extract knowledge and lessons)

Scope of the ProjectCentral Government
Capacity on “institutionalization”
of local development

Local development plan

Civil Society Org.
Initiatives on project implementation
Local Administration
Capacity on formulation andimplementation of development plan

CD in the developing country
JICA’s CD support

Securing Complexity and Ownership

Figure 5. CPI image in CD support from the local community
Source: Author(2) Assessment of CD support from a hub organization
The second type is exemplified by a project that establishes an agricultural extension centerand develops necessary human resources (including training of trainers) at the center.
4

Ohama (2007) proposes a technique that pays special attention to the norms, organizations, andresources in the local community in his theory on Participatory Local Social Development (PLCD).

194

Two things should be considered in performing CA. First, an assessment should be made of
the changes in not only the hub organization’s technical capacities to provide training but also its
overall management ability covering the manpower, the administrative framework, and the budget ascore capacities. Second, in addition to the internal capacities of the hub center, it is also necessary
to assess the enabling environment, including the changes in the capacities and needs of the training
participants, and the capacities of the upper-tier organizations (central government offices)
responsible for developing institutional foundations.
Human resource development
contributing to industrialization

Upgrading
students’ results

Scope of the Project

Upgrading qualityof lectures
Students
Capacity ofunderstanding

Teacher’s trainings
Development of training curriculum
Teachers
Teaching
capacity

Training center andinstructor
Instructor’s capacity on teacher’s training
Training curriculum,
Development of teaching materials

CD in the developing country
JICA’s CD support

Securing Complexity and Ownership

Figure 6. CPI image: CD support from a hub organization
Source: Author(3) Assessment of CD support from policies and institutions
Unlike the first and second types, this type is aimed at policy and institutional development
itself, rather than at enhancing individual and organizational capacities, whose results may beinstitutionalized. Typical examples include the provision of experts to policy-related departments
as policy advisors, a study designed to gather information necessary for developing new policies andinstitutions, and a technical cooperation project aimed at joint research between Japan and thepartner country.
Since this type concerns the basis for state building by the partner country, CA must confirm
strong ownership by the counterparts. An assessment also needs to be made of the capacities andneeds of the actors who administer institutions and those who are affected.

195This is because

policies and institutions to be applied must accommodate the needs in the field.
National institutions will not be built in the short term.

It is necessary to encourage CD of

the actors who build institutions and those who administer them and help these two types of actors tocomplement each other while always respecting ownership by the partner country.

National level
Achievement ofdevelopment goals by thepolicy and institution

Execute policy andinstitution in wider areas

Policy andInstitution

Scope of the Project

PrivateSectorAdministrative
organization
Capacity on execution

Outputs at pilot projects（Extract knowledge and lessons）

Civil
Society

Policy maker, Planning bureau
Capacity on formulating policy
and institution

Administrative organization
Capacity on project implementation

CD in the developing country
JICA’s CD support

Securing Complexity and Ownership

Figure 7. CPI image: CD support from policies and institutions
Source: Author(4) Assessment point as a common factor for the three types
All these three types reflect the differences in the desired performance and the capacities to befocused on.

Yet the important considerations in performing CA for the three types, when

considered as a whole, point to the need to assess the organization’s technical foundations (technicalcapacities), management foundations (core capacities), and policy/institutional and fiscal
foundations that determine the capacities of the organization (the enabling environment) and explore
ways to increase the overall capacity while ensuring that these different kinds of foundations
complement one another.
It is extremely difficult to solidify all these foundations with JICA’s TC alone. JICA is rather
required to ensure JICA’s position in coordination with other donors and the partner country within
the partner country’s national development framework, so that all these foundations will bestrengthened as a national program.

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6. Future Directions of Development Cooperation Activities from a CA Perspective
In sum, CA should be performed not by individual donors but by the donors concerned
working together based on ownership by the partner country. The development of a joint CA tool isbeing discussed toward the HLF-III. However, CA tools so far proposed have rarely been used as
joint tools for developing countries and donors. This should be addressed as a future challenge.
Discussion concerning medium- to long-term CD support for developing countries will likely
increase the predictability for donors to define their intervention strategies from a medium- tolong-term perspective. CA will be increasingly important for JICA as well, which will be soon be
relaunched as a new agency, if it wants to set out a medium- to long-term cooperation menu thattakes advantage of a range of aid modalities, including grant aid and loan aid as well as technicalcooperation.

197

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