CARE Honduras CO Summary Report December 2006 Jennie Perzon Jennifer Jaramillo © 2006 Accenture. All rights reserved.
Outline • Background • • • – ADP Project Objectives – ADP Deliverables Approach – Country Office Approach – Assumptions Initial Findings Honduras – Journey – Current State – External Environment – Current State – Financial Overview – Current State – Pressures – Key Success Factors – Lessons Learned Current Situation Recommended Activities for Key Challenges Support Activities by ADP team – Financial Analysis – Transition Planning – Change Management Outcomes Contact information © 2006 Accenture. All rights reserved. 2
Project Objectives • The ADP project objectives are to collaboratively address short-term and long-term CARE goals for handling organizational impact as a result of reduced resources. – Provide support to the four selected COs in addressing the impact of reduced resources, particularly FFP resources – Document and package approaches, tools, and lessons learned for a globally relevant methodology that other CARE COs can use in the future • Guiding Principles – Balance CO’s immediate needs with globally relevant resources and priorities – CARE and ADP collaboratively team together to achieve project objectives – Align project with ongoing initiatives including the CARE USA Strategic Plan, CO Entry/Exit Criteria, and CO Business Models – Engage key stakeholders for consultation – Share knowledge and mutual learning across the organization – Facilitate re-use of approaches, processes, and tools © 2006 Accenture. All rights reserved. 3
ADP Project - Deliverables Approach Angola te omple C Tajikistan te le Comp Bolivia lete Comp • Key findings • CO Summary • Interim Recommendations and Activities Global Report • Key Findings • CO Summary • Interim Recommendations and Activities • Guiding Principles • Context (Industry and CARE Strategy) • Reference Documentation • Project Overview and Approach • Assumptions • CO Summary x 4 • Key Findings • CO Summary • Interim Recommendations and Activities • Lessons Learned • Key Success Factors • Conclusions & Recommendations Key Deliverables • Global Report Honduras • Key Findings • CO Summary • Interim Recommendations and Activities © 2006 Accenture. All rights reserved. • Support Materials (Templates, Tools and Checklists) • Final Workshop Presentation 4
Country Office Approach • • Wk. 1 -2 • • • Wk. 3 -4 • • Develop an understanding of current operations – By using a top-down approach conduct meetings / workshops and Interviews with key people in CO – Review of relevant documentation (strategy, process, policy etc. ) – Sub-office and field visits Develop an understanding of the environment in which the CO operates – Social, political, economical situation and trends – Donor and NGO environment and trends Conduct analysis to identify CO’s key challenges and goals – Impact of removal of resources – Focus on Operations (Admin, Finance and HR) – Alignment with findings from ATL HQ meetings Validate and prioritize challenges – Meetings, workshops and document review with key stakeholders – Short term vs. long term priorities Collaboratively develop solutions and recommended activities – Work with relevant people in CO to develop and implement (tools & templates) – Focus on change management (org structure, R&R, Communication, training etc. ) Facilitate knowledge sharing – Communicate lessons learned – Share Key Success factors Document findings – CO Summary – Input to global report – Validate with CO SMT, RMU, ATL HQ © 2006 Accenture. All rights reserved. 5
Assumptions • The ADP project is not involved in the definition of the long-term direction of CARE Honduras and the Central American region. • The main focus of the tools and templates that the ADP project develops during this CO visit are focused on short term transition activities for Honduras. However, it is the intent that these tools and templates can be re-used for any future change initiatives in any of the impacted countries, as defined in the regionalisation plan. © 2006 Accenture. All rights reserved. 6
Journey Increase program impact Transform Improve and strengthen CARE Honduras vision • Innovative programs with high impact • Focus on continuous improvement • Increased skills • Proactive, and capacity learning • Create standard organization processes • Continue towards • Refine CARE’s mission operational and vision structure (iterative process) Stabilize Maintain and Repeat Honduras CO is here Restructure Build the foundation Strategic Planning Identify vision • CARE’s presence and operations (Strategic Plan) • Trend towards development programs • Removal of large infrastructure / service delivery funding Analyze Determine the change • Financial Analysis • Determine impact on Program Support Structures • Align analysis of Title II funding removal with regionalisation initiatives • Flexible and agile organisation • Regional Mgmt and SMT lead transition process • Transparent process with staff • Consistent Communication Timeline © 2006 Accenture. All rights reserved. 7
Current State – External Environment Economic Environment • Unemployment is high • Tax and legal implications for working cross-country • Tariff barrier implications • Improved infrastructure and communications within the region • External competition from big box companies expected • Depreciation of currency Political • Cost of Living increases determined by government • CAFTA agreement signed by 4 CA countries. Activities began in April 06. • Drastic changes when government changes hands Honduras • Unstable government (corruption, Donors resignations, etc) • Central America is not a priority to donors • Decrease in revenue from donors • Method of channeling money to the region has changed (through governments and local NGOs) • Starting to access private sector as a © 2006 Accenture. All rights reserved. • Disaster prone country (ie. Hurricanes, earthquakes, etc) Social • Disparity gap between rich and poor continues to grow • Strong human capital • Out migration of human capital • Corporate Social Responsibility (CSR) being promoted • Security issues (unsafe environment) • Engagement in civil society NGO/PVO • Other alliance PVOs still monetize • Other alliance PVOs also have planned Title II funding until 2009 • CARE offers a competitive benefits compared to other NGOs 8
Current State – Financial Overview FY 07 FY 08 Committed Funding $ 5, 362, 081 $ 2, 523, 452 Committed and Likely Funding $ 6, 028, 121 $ 3, 141, 873 Committed, Likely, and Not Committed Funding $ 6, 644, 396 $ 3, 758, 150 SPC levels if remained constant $ 742, 780 SPC % of Committed 14% 29% Title II Funding • Title II Funding currently makes up almost 30% of the CO portfolio • Ends in Sept 07 (Q 1 FY 08) Forecast for Major Transition Points • End of FY 07 © 2006 Accenture. All rights reserved. 9
Current State – Pressures The people in the CO are currently working under the influence of a series of pressures. Staff perception of change is key to the success of change initiatives. Addressing these as part of the transition activities will assist in achieving a smooth transition to a regional structure after the removal of Title II funding. **Input from change management survey (almost 30 managers) in Honduras and from interviews with over 10 management level staff Sources of Current Pressure Description of Impact Regionalization • • • Undefined timeline and milestones for the overall process Timeline and activities that do exist are not communicated well Unclear transitional leadership Unclear understanding of regional roles (interaction and handoffs) Perception that communicated benefits of regionalization are not being realized ( ie. cost savings, attracting donors, etc) Perception that regional structure removes financial support from the COs Perception that regional structure delays operative process in the CO Causes staff to question how and where they fit in the organization’s future Increases day to day workload on staff Instills fear about future job security, some people leaving organisation Dependent on the rest of the region for activities; Long decision making process Removal of Title II funding • Generates anxiety about the future and image of CARE. Historically, Title II funding had been as high as 75% of the CO budget. • Anxiety over poverty reduction for beneficiaries in areas where CARE will no longer be working. • Unclear how costs will be covered after the funding is removed Large concurrent initiatives (Regionalization, Title II, new strategy, etc) • • • Budget Constraints • Reduced satisfaction with employee benefits because of long wait for a minimal salary increase and the removal of employee bonus • Decreases staff morale and resilience • Reduces career development opportunities because of lack of funding for training 10 • Generates anxiety about the CO’s financial situation © 2006 Accenture. All rights reserved. Many leads for many efforts; confusion around who has the answers Perception of unreachable leadership Decision makers and decision making process is not clear Priorities are not clear Requires proactive dependency management to ensure ongoing integration Dilutes the perceived importance of change initiatives
Key Success Factors CARE Honduras has started some aspects of the transition process. Below are a number of positive actions taken which will also form key success factors for future activities. • • • Responsible planning for Title II phase out June 07 (program focus) – Sustainability model built in – Exit strategy developed early (with involvement from SO’s) – Success of programming will aid in obtaining future funding Change Management Workshop – Identification of key focus areas, strengths and weaknesses – Honduras format to be used in rest of region Transition in 2005 (Title II funding reduction) was responsibly conducted – Workshops for staff (both staying and leaving) – Staff viewed experience as ‘special’ Engagement of key back office staff in regionalisation process – HR, Finance, Admin Positive working Relationships within CO – Program Support (Admin, HR, Fin, IT) seen as one cohesive unit (engaged in proposals together) – Program Support maintains good relationship with National Program Director (reporting line is to Regional Leads) Program has developed learning groups (ex. Education) Team building Events • – – Good relationship and presence with other PVO’s and NGO’s and donors – Participation in Alianza – Active member of International Cooperation Agency (ACI) – Alliance for Food For Peace © 2006 Accenture. All rights reserved. 11
Lessons Learned CARE Honduras has started some aspects of the transition process. Below are a number of lessons learned from the process to date in addition to some recommendations on future focus areas. • • • Ensure thorough Planning for Transition – Alignment of Regional and CO specific activities – Assignment of key responsibilities – Alignment of communication with transition activities – Allocation of adequate resources and capacity for expectations Ensure Broad Financial Analysis – Development of future scenarios (worst case, likely case, best case) – Ensure realistic and accurate planning and evaluation of pipeline – Understanding of impact to Back office Structure (Program Support) – Identification of priority SPC cost saving areas Balance Financial viability vs. Quality of program (services) – Balance impact on quality of service to program area – Conduct thorough volume needs analysis – Monitoring and evaluation throughout the process Communicate (Consistent, Clear and Honest Communication) – Develop Communication plan and assign responsibilities – Use various communication methods – Holistic communications to include all the benefits to regionalization (ie. Beyond ‘cost savings’) – Salary situation Maintain motivation of team – Reduction in team motivation due to perceptions/concerns of job insecurity among staff – Ensure work/life balance throughout the process – Develop and communicate transparent process for re-structuring © 2006 Accenture. All rights reserved. 12
CO Transitions Framework – Key Focus Areas for Honduras CONTEXT Strategy & Vision Governance Programs • CI strategy impact on identifying future state • CARE Leadership from RMU and Atlanta • Donor and program impact on operations • CARE USA strategy • • • RMU and CO strategy Any governance processes or bodies to oversee CO Transition Program dependency on operations (requirements) • Impact of operational change Country Operations Finance • Funding pipeline • SPC • Scenario analysis Processes • Policies and procedures • Workload • Reporting lines • SUPPORTING ACTIVITIES • Organization Structure Job descriptions Talent Management • Talent management • Core competency development • Skill analysis • Capacity development Knowledge Sharing Succession planning • Roles and responsibilities Change Management Staff Development • • • Communications Leadership Retention and motivation Monitoring & Evaluation Identify key success factors and lessons learned • Measure success and impact of transition • Share transition process with other CARE COs • Measure success of ongoing operations • • © 2006 Accenture. All rights reserved. • Share within CO / RMU Integrate metrics into CARE’s broader M&E and reporting mechanisms 13
Current Situation – Summary Challenges Country Operations Financial Analysis • Coordinating regionalization efforts with transition • Managing dependencies on other COs in the Central America Region • Maintaining Program Support quality during transition (re-structure) activities • Unclear how to implement changes • No specific timeframe for transition and regionalization efforts • Understanding of Transition Planning concept / activities within Regional and Honduras Mgmt Team • Clear and efficient processes for transition (restructure) • High quality program support services • Clear ownership and responsibilities • Title II Funding will end in Honduras and Guatemala • Unclear coverage of current SPC cost structure with future funding pipeline • Dependencies on regional SPC coverage from other COs in the region • High level financial analysis of future financial situation • Graphical presentation of various scenarios • Understanding of implications on SPC (Cost structure, Org Structure, timing) • Structure of strategic support services not defined (Regional and CO level) Organizational • Current standardization process underway Structure • Need skills analysis (current v. future) • Unclear roles and responsibilities • Volume/Needs analysis has not been determined Change Management Goals and Objectives • • • Lack of communication to staff Fear of staff loss before scheduled end dates Concern around lack of motivation Work/life balance Retention of best people © 2006 Accenture. All rights reserved. • Clear roles and responsibilities • Ownership and accountability for functions and processes • Flexibility in staffing • Motivated staff and increased team spirit • Integration of further communication into existing plans • Increased staff retention • Transparent organisation 14
Current Situation – Country Operations Challenges • Coordinating regionalization efforts with transition (ie. SCALA online, etc) • Managing dependencies on other COs in the Central America Region • Maintaining Program Support quality during transition (re-structure) activities • Unclear how to implement changes • Get out of ‘project mode’ • No specific timeframe for transition and regionalization efforts Key Focus Areas • Planning • Engaging key people • Timing Recommended Activities • Schedule and conduct a Transition Planning workshop with key stakeholders • Identify specific activities for the CARE CO • Identify timeframe for each activity • Determine resources needed for activities • Determine owner of activities • Identify risks if activities are not completed • Develop monitoring and evaluation criteria Benefits • Ensure regionalization and Title II activities are aligned and coordinated • Systematic approach to transition • Incorporate lessons learned from other transitions (Angola, Peru, Tajikistan, Bolivia, etc) • All key stakeholders have input (National Office, Sub Office, Program and Program Support) • Tool to prioritize activities and mitigate risks • Minimize timeframe for transition activities • Limit impact to programs; Work in partnership with program support • Clear roles and responsibilities for transition process Tools & Resources • CARE contacts © 2006 Accenture. All rights reserved. 15
Current Situation – Financial Analysis Challenges • Title II Funding will end in Honduras and Guatemala • Unclear coverage of current SPC cost structure with future funding pipeline • Dependencies on SPC coverage from other COs in the region • Unknown timeframe for transition Recommended Activities • Conduct detailed financial analysis • Breakdown financial activity by quarter (Differ between CARE and partner income) • Determine amount of SPC cost adjustment • Determine sources of SPC including % of total • Develop potential budget scenarios (ie. Best case, likely case, worst case) Benefits • Understand the amount and timing of cost adjustment for SPC • Ensure broad financial analysis by assessing all options Key Focus Areas • SPC Tools & Resources • Financial Analysis report from Angola, Peru, Tajikistan, Niger © 2006 Accenture. All rights reserved. 16
Current Situation – Change Management Challenges • Lack of understanding of Regionalisation timeline, impact and implications for CARE Honduras • Limited of understanding about Title II program ending impacts and implications for CARE Honduras • Retention is a concern and some people leaving organisation • Organisation and staff unsettled due to rumours • Lack of motivation of team to perform in new roles (likely to happen in new structure – some work/life balance concerns in current state) Recommended Activities • Increase communication (utilizing existing forums) • Leadership teams to lead and inspire a positive culture • Ensure transparency across all processes (especially for restructuring process, selection criteria and timing) • Conduct a Stakeholder Analysis to determine current awareness levels (including external audiences) • Develop Communication Plan • Develop Communication Calendar (align with transition plan) • Assign Responsibilities • Align and incorporate into existing communication methods Key Focus Areas • Regionalisation • Title II Program ending • Potential re-structure © 2006 Accenture. All rights reserved. Dependencies • Regionalization plan and milestones Benefits • Motivated staff • Increased Staff retention • Maintains respect for people and individuals • Transparent organisation • Effective organisational transition • Reduced confusion and disappointment Tools & Resources • Survey results from Honduras • Existing Comms Plan (Title II exit strategy) • CARE Communication Guides / standards 17
Support Activities – Financial Analysis • Objective – Understand future financial situation for CARE Honduras – Understand implications to SPC • Outcome – Developed macro financial analysis on portfolio, SPC recovery rates, and cost structures – Developed understanding of SPC implications based on future funding and recovery rates – Knowledge share on financial analysis components – Process and tool for use in future financial analysis – Direct input for timeframe required for transition © 2006 Accenture. All rights reserved. 18
Financial Analysis DR AF T © 2006 Accenture. All rights reserved. 19
Support Activities – Change Management • Objective: – To collaboratively workshop training on change management for the transition – Engage key staff in order to transfer “know-how” on the communications management – Incorporate lessons learned from other re-structures and transitions (Angola, Tajikistan, Bolivia, etc) • Outcome – Conducted high level Change Management and Communications Overview and Discussion – “Know-how” of key transition communication concepts – User-friendly tools and templates © 2006 Accenture. All rights reserved. 20
Communication Plan DR AF T © 2006 Accenture. All rights reserved. 21
Outcomes • Global Benefits – Continued to develop additional tools and templates for inclusion in the global report – Insight and documentation of Honduras’s Key Success Factors and Lessons Learned • Country Office Benefits – Insight to the CO team in how to approach key challenges ahead – Targeted workshops and meetings for key priorities focusing on both skill building and deliverables • Financial Analysis • Transition Planning • Change Management (incl. Communications) – Guidelines, templates and other support materials to be used in developing and implementing solutions © 2006 Accenture. All rights reserved. 22
Thank You Thank you for graciously hosting us. Please do not hesitate to contact us with questions or comments at anytime. We look forward to your continued progress. Jennie Perzon Email: jennie. perzon@accenture. com Skype: jennie. perzon Mobile: +46 8 451 38 94 (Sweden) Jennifer Jaramillo Email: jennifer. jaramillo@accenture. com Skype: jennifer. jaramillo Mobile: 313 -516 -1199 (US) © 2006 Accenture. All rights reserved. 23
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