When an organisation with more than 10,000 workers spread across 120 offices worldwide decides to streamline its operations to meet tough new targets and head off threats from rivals, it is bound to cause pain.
But when it is the World Bank, a multilateral institution owned by 188 governments that aims to help the poorest in society, that is unveiling drastic reforms to fight off threats from cash-rich philanthropists, it risks becoming a political quagmire.
Jim Yong Kim, the Korean-born doctor who took over the Bank's presidency in 2012, wants to cut $400m (£250m) from its budget over three years – equivalent to a swingeing 8% cut.
"That causes alarm at first, but I have no doubt in my mind that we can find efficiencies," he says, sitting in the Bank's ornate headquarters in Washington. It is clear that will include job cuts.
"There will be staff reductions – there's no question. But we are going to do everything we can to keep our best people.
"We are here for a purpose, and everyone who is contributing to that purpose will stay. And for those who are doing less to contribute to that purpose, we are going to have find ways to exit them.
Yes, there will be a lot of people who will be very unhappy with me but we are doing this because of the mission.We are not doing this out of spite; we are not doing this just to cut numbers."
This reorganisation has led to high-profile casualties. Two long-standing executives, managing director Caroline Anstey and vice-president Pamela Cox, stepped down after the Bank's annual meetings last month, after a combined 51 years of service.
This has caused uncertainty among the remaining executives, according to Bank observers. "There has been great turmoil over some of the personnel decisions," says Homi Kharas, deputy director at the Brookings Institution and a former World Bank economist.
Kim says there will be no more management cuts and insists it is vital the Bank trims expenses at a time of austerity.
"The Bank has no choice but to be smaller," agrees Ngaire Woods (pdf), professor of global economic governance at Oxford University.
"The lending that the Bank makes money from is drying up." Professor Paul Collier, author of The Bottom Billion, says the Bank "has to change – and change fast".
Now that middle-income countries no longer need its grants or highly concessional loans, the Bank must focus on the poorest countries that are "economically, socially or politically challenging" – the ones other donors are reluctant to touch. Kim has set ambitious goals.
Last month he pledged to slash poverty to 9%, from 18%, by 2020 after NGOs said his initial target for cutting it to 3% by 2030 was too slow. To achieve this, Kim is recentralising power by creating 14 "global practices" in areas such as education and agriculture that will cut across the existing country-based structure.
Woods warns Kim to be "careful not to overestimate the degree to which the Bank is perceived by its borrowers as a knowledge bank as opposed to a source of funds. What I hear officials in countries say is what they really value is experience, which is different to global practice and knowledge," she says.
"The challenge facing Kim is to understand the politics of implementation, which is very country-specific, while recentralising the Bank. How do you get these global policy experts to understand the politics of implementation?"
The 1818 Society, a Washington-based association of 6,000 former World Bank employees, goes further, describing the plan as "patently uninspiring and simply confusing".
Alan Gelb, senior fellow at the Centre for Global Development and former director of development policy at the Bank, is more positive, saying the strategy includes new metrics to measure success.
"I think that's what will really make a difference," he says, adding that a focus on technical areas will force the Bank to look at the quality of its service delivery rather than just whether it is spending money. But he warns that reorganisation will raise issues over staff incentives.
"The tensions between the needs of a country programme and the desires of a technical group are still there," he says. "It can work, but it's creating a lot of uncertainty among the managers and some of the regional staff who don't know how they will fit into this new structure.
"It could be used to streamline staff, essentially by pulling staff back into technical pools and then rationalising those pools. That process will require a lot of management."
So far, no quagmire. Kim's strategy was approved last month by all 188 member countries – its shareholders.
He is convinced this will end the debate over whether the Bank has a role in a world crowded with aid agencies, regional development banks and philanthropist organisations such as the Bill & Melinda Gates Foundation.
"We are going to be the best in the world at bringing global knowledge to a local context," Kim says. "No one combines knowledge with real money and real projects the way we do."
theguardian.com
But when it is the World Bank, a multilateral institution owned by 188 governments that aims to help the poorest in society, that is unveiling drastic reforms to fight off threats from cash-rich philanthropists, it risks becoming a political quagmire.
Jim Yong Kim, the Korean-born doctor who took over the Bank's presidency in 2012, wants to cut $400m (£250m) from its budget over three years – equivalent to a swingeing 8% cut.
"That causes alarm at first, but I have no doubt in my mind that we can find efficiencies," he says, sitting in the Bank's ornate headquarters in Washington. It is clear that will include job cuts.
"There will be staff reductions – there's no question. But we are going to do everything we can to keep our best people.
"We are here for a purpose, and everyone who is contributing to that purpose will stay. And for those who are doing less to contribute to that purpose, we are going to have find ways to exit them.
Yes, there will be a lot of people who will be very unhappy with me but we are doing this because of the mission.We are not doing this out of spite; we are not doing this just to cut numbers."
This reorganisation has led to high-profile casualties. Two long-standing executives, managing director Caroline Anstey and vice-president Pamela Cox, stepped down after the Bank's annual meetings last month, after a combined 51 years of service.
This has caused uncertainty among the remaining executives, according to Bank observers. "There has been great turmoil over some of the personnel decisions," says Homi Kharas, deputy director at the Brookings Institution and a former World Bank economist.
Kim says there will be no more management cuts and insists it is vital the Bank trims expenses at a time of austerity.
"The Bank has no choice but to be smaller," agrees Ngaire Woods (pdf), professor of global economic governance at Oxford University.
"The lending that the Bank makes money from is drying up." Professor Paul Collier, author of The Bottom Billion, says the Bank "has to change – and change fast".
Now that middle-income countries no longer need its grants or highly concessional loans, the Bank must focus on the poorest countries that are "economically, socially or politically challenging" – the ones other donors are reluctant to touch. Kim has set ambitious goals.
Last month he pledged to slash poverty to 9%, from 18%, by 2020 after NGOs said his initial target for cutting it to 3% by 2030 was too slow. To achieve this, Kim is recentralising power by creating 14 "global practices" in areas such as education and agriculture that will cut across the existing country-based structure.
Woods warns Kim to be "careful not to overestimate the degree to which the Bank is perceived by its borrowers as a knowledge bank as opposed to a source of funds. What I hear officials in countries say is what they really value is experience, which is different to global practice and knowledge," she says.
"The challenge facing Kim is to understand the politics of implementation, which is very country-specific, while recentralising the Bank. How do you get these global policy experts to understand the politics of implementation?"
The 1818 Society, a Washington-based association of 6,000 former World Bank employees, goes further, describing the plan as "patently uninspiring and simply confusing".
Alan Gelb, senior fellow at the Centre for Global Development and former director of development policy at the Bank, is more positive, saying the strategy includes new metrics to measure success.
"I think that's what will really make a difference," he says, adding that a focus on technical areas will force the Bank to look at the quality of its service delivery rather than just whether it is spending money. But he warns that reorganisation will raise issues over staff incentives.
"The tensions between the needs of a country programme and the desires of a technical group are still there," he says. "It can work, but it's creating a lot of uncertainty among the managers and some of the regional staff who don't know how they will fit into this new structure.
"It could be used to streamline staff, essentially by pulling staff back into technical pools and then rationalising those pools. That process will require a lot of management."
So far, no quagmire. Kim's strategy was approved last month by all 188 member countries – its shareholders.
He is convinced this will end the debate over whether the Bank has a role in a world crowded with aid agencies, regional development banks and philanthropist organisations such as the Bill & Melinda Gates Foundation.
"We are going to be the best in the world at bringing global knowledge to a local context," Kim says. "No one combines knowledge with real money and real projects the way we do."
theguardian.com
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