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HeidenhofGUENTER HEIDENHOF recently joined the MENA Vice Presidency as Sector Manager for Public Sector Governance, bringing with him comprehensive expertise on governance issues, institutional development and managing change, with a special focus on the procedural and institutional underpinnings of public sector reform. His previous post was Governance Advisor in India, where he oversaw the Bank's extensive lending program. Mr. Heidenhof has also held Bank positions as Cluster Leader for governance, public sector, and public finance reforms in African countries, including Madagascar, Mozambique, Mauritius, Namibia, and other countries in Sub-Saharan Africa. In a recent interview with GN&N, Mr. Heidenhof shares some reflections and insights from his work experience on governance and public sector reform.


Recalling one of the most influential experiences of his time in Africa, Mr. Heidenhof describes the ‘leadership program,’ which was established in collaboration with the Center for Leadership Development at Harvard University. This program, he explains, was aimed at assisting government leadership in translating overall strategies into practical measures.


Through regular roundtable discussions at the Cabinet level and progressive participation of stakeholders in policy development, the leadership program helped facilitate the development of a reform strategy fully owned by the government, the administration and many stakeholders. At the level of the ministries, departments and agencies, dedicated change management support was provided to facilitate the implementation of the reform strategy. “You can see from this example how valuable a well organized change management process is,” he notes.


After moving from the Africa region, Mr. Heidenhof was most recently stationed in India which is one of the biggest clients of the World Bank. The Bank, in close collaboration with the Government of India (GoI) realized the importance of improving the quality of the India portfolio of the World Bank, also by introducing a stronger emphasis on public sector governance issues. Mr. Heidenhof’s appointment as Governance Advisor was a direct response to the realization that the Bank must better understand the challenges of World Bank support to large and complex countries such as India where issues around institutional development and capacity constraints often undermine reform efforts. 


Mr. Heidenhof explains his focus at that time as having been to “clarify the Bank’s stance on governance,” shifting away from fraud and corruption to a more holistic and comprehensive understanding that these two elements are consequences of weaknesses in the governance system. These weaknesses, he explains, stemmed from: 1) weak policies or strategies; 2) a weak public institutional framework; 3) unclear, outdated or overly bureaucratic procedures; and 4) insufficient implementation capacity at the level of the executing agencies. In coordination with the GoI, the Bank decided to put more emphasis on strengthening public institutions and on improving capacity building. “Working closely with the government,” Mr. Heidenhof states, “the overall portfolio risk in the India program declined from 35 percent to about 15 percent in just two years.”


India left a lasting impression. “Most fascinating is the country’s dynamics and huge human potential. It’s remarkable to think of what has already happened, but at the same time many public sector governance challenges still remain unsolved,” he states. “These challenges indicate how difficult it is to establish a clear way forward on public sector development and how hard these issues are to be tackled.”


Mr. Heidenhof sees similar challenges facing the MENA region, but also similar potential for reform. “There are clear visions in MENA, a dynamic private sector, and significant human resource capacity. And while the public sector is often seen as a stumbling block rather than a facilitator, India can be a good comparator on what is possible.” Like India, he explains, “I see a gradual shift in some countries in MENA from a self-centered civil service to more performance-oriented public institutions. Also similar is the reluctance to talk about governance,” he adds, “because of its implicit link to fraud and corruption. Understanding these issues as consequences of institutional or capacity weaknesses is essential to addressing their root causes.”


“Governance has a lot do with institutional development and change management. I find these issues to be both intellectually and professionally challenging,” he explains. These issues comprise the basis of his interest for public sector reform, focusing specifically on the identification of potential ‘drivers of change’. According to Mr. Heidenhof, “there is often a rather dogmatic discussion about good versus bad governance”. He notes that, while there is a diverse array of positions on these issues, there is no real ‘right’ or ‘wrong’ approach. To establish a clearer methodological approach for institutional development, he stresses “there’s still a lot of ground to cover.”


“At the same time, governments are interested in increasing the value-for-money of public spending and improving the delivery of public services. In my experience,” he states, “successful reforms in these areas require adequate policies and strategies, strong institutions, good procedures and the right people to translate the reforms into concrete action. This provides a simple framework to better understand the complex notion of governance and to identify the right entry points.”


On thinking forward, Mr. Heidenhof is interested to see the applicability of his own international experiences to the MENA region. While acknowledging the value in cross-regional knowledge-sharing, he notes that the most rewarding learning experiences often come from within. He acknowledges that there is a lot of work to be done, but ‘demystifying’ the notion of governance is an important first step. “What is the right strategy on public sector governance?” he asks.  Such a strategy is not “pre-cooked,” nor an “Anglo-Saxon or American model. I’d like to think about governance as a multi-dimensional concept within which good policies, strong institutions and procedures as well as adequate human resource capacity contribute to better service delivery and development outcomes. Public sector governance support programs must take into account country specifics. An ideological debate will not help to address changes so it is important to keep it practical, focusing on improving the value for money of public spending, maximizing the development impact through improving the delivery of public services, and creating an enabling environment for private sector-led growth.”


He stresses the importance of pragmatic and implementable public sector governance programs that are based on a clear understanding of outcomes and deliverables. “The Bank,” he states, “can help design such programs, as our experience is very broad on what works and what doesn’t. The debate is on how to get there.”


A German national, Mr. Heidenhof began his career as a Magistrate.  Prior to the joining the World Bank he worked for the German Federal Government and has held several senior positions mainly in the area of change management and institutional development. His working experience also includes the German-Finnish Chamber of Commerce in Helsinki and the Indo-German Chamber of Commerce in New Delhi, where he worked as an Arbitration Judge. He holds degrees in international law, public administration, and economics.


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