The Social Performance Task Force (SPTF) just released documents from the concluded annual meeting of the task force this year in Panama. Reviewing the issues raised and discussed at the meeting, we at PFTAS can claim that we are advanced in our approach in SPM mainstreaming. We not only shared the concepts of SPM but have addressed the issues raised in the annual meeting. We have conducted assessment, facilitated strategic planning to integrate SPM in the long-term plans and have assisted our partners in initiating the mainstreaming of changes that they have identified and prioritized. This forward looking stance is our comparative edge over other consulting firms.
I would like to reprint the message of the SPTF Secretariat verbatim on the main issues discussed during the annual meeting:
1. We need a new approach to strategic planning: To many people’s surprise given the prevalence of strategic planning, it turns out that this is still an area of weakness in our industry. Two key themes arise here. Firstly, the need to integrate SPM into the very fabric of strategic planning. SPM isn’t a line item in the strategic plan – it IS the strategic plan. Unless this happens, SPM will always exist in parallel with in the organization, and we’ll always be fighting to operationalize it. The second theme is this: death to the five-year plan. In the context of rapidly changing institutions and markets, the plan should not be set in stone for five years, but a living breathing document. To facilitate this, managers need to build in time on a regular basis to take a pause from day-to-day operations and focus instead on critical self-reflection and the strategic vision.
2. We need a new approach to change management: The Universal Standards for SPM set out WHAT we need to change within our institutions to achieve our social mission, but MFIs also need guidance on HOW to manage the organizational change process. This is a real skill gap among organizations (which also relates to the gap in strategic vision among leaders). Two key ideas emerged during the meeting: organizations need to consider whether an SPM Champion and an SPM Board Committee are appropriate to their individual context. While having these functions offers visibility and accountability to the SPM agenda, they also bring the risk of marginalizing or “silo”-ing” it.
3. We need to unpack the issue of balanced returns: A range of stakeholder interests come into play when talking about the interaction between prices and profits. Firstly, we need to focus at the role of investors in terms of driving expectations. Secondly, we need to understand client preferences and outcomes. Thirdly, we need to ensure that MFIs are deliberate and skilled in the challenge of setting prices – because evidence suggests that it is not an automatic trade-off.
4. Harmonization is key: In the coming years, the SPTF will be making a big push towards harmonizing data collection and reporting processes, and aligning them to the Universal Standards. Assessors and auditors have also worked to harmonize their tools to the Universal Standards. At an institutional level, the Universal Standards can and should be used to guide and shape the work of external technical support that MFIs receive, to ensure that efforts to strengthen institutional systems and processes support rather than hinder Universal Standards compliance.
Where SPM is fully integrated into the strategic planning process, this can be facilitated.
5. We need to understand the linkages between Universal Standards compliance and improved client outcomes: This issue came up in several sessions – notably the balancing returns discussion – which absolutely need to be grounded within an understanding of what’s happening at the client level.
6. MFIs need practical guidance each step of the way: Again, the need for practical guidance to how to implement the Universal Standards came up as a strong message from members. Important here to reiterate the commitment of the SPTF to delivering on this promise and highlight progress made to date.
PFTAS will continue to provide quality and relevant technical assistance to its partners consistent with industry and global standards.