While there is extensive literature on measuring efficiency at project and programme levels, less attention has been paid to defining and assessing it at organisational and system-wide levels in the multilateral context.
The Organisation for Economic Co-operation and Development (OECD) defines efficiency as “how well are resources being used” or “the extent to which the intervention delivers, or is likely to deliver, results in an economic and timely way”.3 Assessing efficiency involves three interrelated dimensions:
· Economic efficiency: How cost-effectively resources are converted into results;
· Operational efficiency: How well resources are allocated, adapted to changing needs and supported by effective decisions and risk management;
· Timeliness: The extent to which results are achieved within a reasonable timeframe and delays are effectively managed.
Improvement in any of these dimensions can free up resources, avoid unnecessary costs and/or enhance the quality of deliverables.
This brief focuses on the concept of efficiency as defined above. While “value for money” is often used interchangeably with efficiency, it is, in fact, broader, encompassing economy, efficiency, effectiveness and, sometimes, equity (OECD DAC Glossary, 2019; DFID, Approach to Value for Money, 2011). Given the lack of a single agreed definition across the multilateral system, this brief focuses its analysis on the concept of efficiency.
The brief acknowledges that effective cost-recovery strategies are key to an organisation’s efficiency and financial sustainability. The diversity of cost-recovery strategies is referred to in the various sections. A more in-depth and comparative analysis of cost-recovery strategies would require additional data collection and analysis.
This brief aims to offer insights into elements of efficiency and cost-saving measures within and across UN entities. In line with the UN80 efficiency workstream and in light of announced staff cuts, the brief examines:
· how administrative support processes and systems contribute to operational efficiency;
· how organisational structures and human resource management can be rationalised to create leaner, more efficient institutions;
· how principles of economic efficiency and timeliness are integrated in operational management.
While the brief looks at administrative collaboration between agencies, efficiency gains from programmatic collaboration, such as aligned business processes or clear division of labour, will be explored in a separate thematic brief on comparative advantage and collaboration. Funding-related impacts on performance are addressed here from an efficiency perspective, while the forthcoming thematic brief on results and mandate implementation will examine them more holistically.
The analysis draws on 15 recent MOPAN assessments of UN organisations,4 primarily of organisations in the UN80 clusters for development, humanitarian and specialised agencies. Evidence has been extracted from the assessments’ main reports as well as selected MOPAN micro-indicators (MIs) in the assessments’ technical annexes.5 Additional external documentary resources have been consulted and are referenced in footnotes. The insights presented are informed by the available evidence, which varies in depth and detail across the assessments and external studies reviewed. Annex C summarises evidence for each organisation.