PNP Tracking Tracking the Negotiations and Performance of Partnerships for Sustainable Development

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1 Tracking the Negotiations and Performance of Partnerships for Sustainable Development

2 PNP methodology etrack software platform Sustainability Benefits Realisation

3 To achieve sustainability objectives and policies, many businesses, government agencies and international NGOs are experimenting with new forms of strategic alliances and partnerships that bring together the private sector, public authorities and civil society groups. Some leadership organisations have now moved beyond this experimental phase and are looking to embrace multi-sectoral partnerships as a modus operandi for the way in which they contribute to sustainable development.

4 Partnership Performance As an organisation becomes more dependent on partnership-based initiatives, it is important to have an internal capability to track the performance of individual partnerships over time. Managers need to be able to: track the real costs involved in the deployment of an organisation s assets, cash or staff competencies in a partnership arrangement; react to project-creep so as to maintain the intended balance of project outcomes between different internal organisational objectives: policy delivery, risk reduction, compliance, cost savings, new businesses etc; as well as between these objectives and those of the other partners; integrate activities involving partnerships with unilateral actions undertaken by the organisation.

5 Partnership Negotiations In addition, the front-end process of negotiating the terms of a partnership objectives, resources commitments, decision-making rules etc. - can be lengthy, from a few months to a number of years. Negotiations are often periodic, piecemeal, and their objectives prone to change. It is therefore important to have an internal capability in capturing the results of partnership negotiations and feeding this into subsequent negotiations. Negotiators and Brokers need to be able to: identify from where in an organisation different financial and in-kind resources and competencies can be drawn to contribute to a partnership; know how an organisation s resources will complement or duplicate those of other potential partners, and where there are gaps in the overall project design; achieve clarity on the underlying strategic interests of each partner, and how performance against these interests will be measured.

6 PNP Tracking - some options Can be used by an individual partner or all partners together. Can handle both unilateral and partnership based activities. Can generate a single Benefits Register, enabling comparisons to be made between different financial and non-financial outcomes, and between different partners. Can be used to generate progress reports of both partnership negotiations and partnership performance

7 The Building Blocks Benefits Register Financial Accounts/ Budget Deployment of Resources, Assets and Competencies Leverage of Resources from other partners Partnership project activities Outcomes: objectives shared by all partners Each partners strategic objectives for the partnership policy delivery risk management standards compliance financial benefits new business

8 Benefits of PNP Tracking for Businesses closely follows the efforts of a business to enhance its sustainable development performance through the financial accounts (Balance Sheet, Profit and Loss Account and Case Flow), ie follows the results chain all the way home. provides credible information to satisfy senior managers and investors that the efforts of the business to enhance its sustainable development performance through partnership is either cost neutral or of commercial benefit. helps to integrate financial reporting with social, economic and environmental reporting.

9 Benefits of PNP Tracking for Government Agencies and NGOs closely follows the efforts of the organisation to enhance its sustainable development performance through the related expenditure frameworks and budgets. provides credible information to satisfy senior officials and managers that: the policy goals of the organisation to enhance its sustainability, development or poverty reduction impact is begin achieved; the organisation s resources are being used to leverage additional resources from the private sector; and that this leverage of private sector resources is contributing to public goods and is aligned with the organisations policies and goals.

10 An Illustration Application of PNP Tracking to the Supplier Enhancement Programme of a mining company: support to local contract cleaning companies Overseas Development Institute/eTrack Products 2004

11 Strategic Objectives/Outcomes for the Partnership Benefits Register Outcomes: objectives shared by all partners Partnership projects Each partners strategic objectives for the partnership policy delivery risk management standards compliance financial benefits new business Overseas Development Institute/eTrack Products 2004

12 Design Requirements and Competencies Design Requirements Resource deployment by company Overseas Development Institute/eTrack Products 2004

13 Tracking Costs Tracking costs Overseas Development Institute/eTrack Products 2004

14 Rolling-up Costs and Benefits Benefits Register Outcomes: objectives shared by all partners Each partners strategic objectives for the partnership policy delivery risk management standards compliance financial benefits new business Overseas Development Institute/eTrack Products 2004

15 Benefits Register Benefits (and costs) to KMC Inc of adopting a partnership approach to support local contract cleaning companies Q4 of Q12 Category Description Anticipated (Q12) Realised Variance (%) Financial Non-financial Financial Non-financial Financial Non-financial Benefits Financial cost savings on contract cleaning bill from Q1 80,000-2,300-3 Commercial Contractor Reliability % improvement from Q Contractor Quality % reduction from Q Compliance Social Management Plan % improvement in local supplier satisfaction Reputation Positive media reports local new spapers Positive media reports national new spapers ,000-2,300 Costs Captial costs Office equipment 10,000 12, Operational costs (NPV) Office-space 60,000 17, Finance Director 15,000 8, Book-keeper 21,000 6, Technical skills training 18,000 5, Interest (on loan = $0.1m) 33,000 8,000 43, ,000 20,000 36, Net financial Benefit 37,000-22, On track w ithin 5% Non performing > 5% Over performing > 5% Overseas Development Institute/eTrack Products 2004

16 Further PNP Tracking information For further information contact: Dr Michael Warner Overseas Development Institute 111 Westminster Bridge Rd London, SE1 7JD Tel: +44 (0) Overseas Development Institute/eTrack Products 2004