during 2006–08. The improvement in performance is based on a number of factors, including a change in IFC’s strategy of engaging in several sectors, such as agribusiness and tourism, and improvements in IFC’s work quality ratings in this cluster. The changes in the performance of IFC industry clusters, however, were not statistically significant. Advisory Services
IFC is consolidating its Advisory Services operations following a rapid expansion beginning in the early 2000s. These operations grew more than tenfold in expenditures and sixfold in staffing between FY01 and FY10.28 However, the number of new projects approved for external clients declined from 212 in FY08 to 118 in FY11 (figure 2.11). Project expenditures for client-facing Advisory Services projects increased from $132 million in FY08 to $182 million in FY11.29 Access to Finance and Sustainable Business Advisory continue to be the two largest business lines in new projects. As with investment products, IFC has enhanced the focus of its Advisory Services on IDA-eligible countries. Fifty-eight percent of evaluated Advisory Services projects that were completed in FY08–10 had mostly successful and higher ratings for development effectiveness.30 For projects closed by FY10, a modest downward trend has been observed for development effectiveness ratings since systematic evaluation of Advisory Services began in FY08. The group of evaluated projects was determined by excluding nonclient-facing and knowledge management Advisory Services projects. Quality of design is key to project success. Seventy-two percent of unsuccessful projects had poor design, elements of which included lack of proper indicators and baseline data, lack of a proper needs or market assessment, and lack of clear objectives with realistic associated outputs and impacts and an adequate mix of activities to achieve these. Among IFC’s Advisory Services operations closed in FY08-10, the Public-Private Partnership (PPP) business line has the lowest development effectiveness ratings. The modest success rate for PPP projects (46 percent mostly successful or higher) calls for management attention, given that IFC expects to expand this line of business (figure 2.12). Despite the low success rate for PPP projects reviewed in this period, successful PPP projects show a potential for high development impact from new and improved services they introduced that affected a large number of people. The main determinant of poor project performance was lack of client commitment. Challenging political environments and obstacles as well as IFC work quality shortcomings drove low development effectiveness ratings. Although in many instances teams identified the main risks facing the projects correctly, IFC’s project preparation and design fell short, and it lacked a proactive approach to mitigating and managing identified risks. Earlier and more active client and broader stakeholder engagement during design and implementation and sequencing of projects in high-risk environments could enhance the chances of success.
World Bank Group Operations: Findings from Evaluation Work
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