UNDP innovation efforts during 2014-2019 were characterized by a widespread and rapid experimentation across the organization. The Innovation Facility (IF) has been instrumental in this effort by catalyzing rapid experimentation and building organizational muscle for innovation. Governments and partners in over 70 countries built up new skills (ethnography, design thinking, foresight), adopted new approaches to complex issues (behavioral insights, new data) and were exposed to a larger network of non-traditional partners. For UNDP, this first phase of the facility brought innovation from the margins into the core of what we do. However, changes in internal and external contexts during the last 18-24 months necessitate rethinking of the focus from more tactical (rapid prototyping, answering the ‘how’ do we solve a problem) to more strategic efforts (the ‘why of policy design, portfolio approaches). In its new phase, the premium is on building a new set of core capabilities both within UNDP and government and other partners around system transformation. One of the critical learnings from UNDP’s experience in innovation to date is that organization’s ability to design and dynamically manage structured portfolio of interventions (as opposed to a focus on a single-point interventions) is likely to become an important capability to bring about change in face of deep systemic issues. This response is a recognition that development and public policy address complex issues with high degrees of uncertainty and ambiguity and as such requires an entirely new set of decision-making frameworks, capabilities, structures and performance indicators. This is validated through both our own work with Deep Demonstrations but also collaboration with our many partners - from traditional donor countries to foundations, to innovation outfits. Assignment UNDP is currently actively engaged on a number of “deep demonstrations” to explore the different facets of portfolio approaches in the context of development work and gradually define its own way of implementing them. What is coming out of this emergent work is that “portfolio” in a UNDP context and from a program development perspective is likely to be quite different from the way the term is traditionally understood in the financial sector or in innovation literature. It also signals a significant departure from “business as usual” when it comes to programming. Most notably a portfolio approach indicates the need to: - Shift from single point solutions to a set of interventions/probes that learn from each other over time, as a way to deal with emergence and as the understanding of a system evolves - Move beyond a siloed, projectized logic to embrace system approaches and long-term thinking/investment - Replace the “funneling logic” (trying out many things, hoping to get to one solution that will scale) with a layering logic (accumulating learning and insights over time from a set of evolving probes/interventions) - Move from a transactional to a relational logic of interaction with partners, so as to build over time a “movement” of different constituents with a stake in system transformation This programmatic layer in the new “stack” will need to be complemented by a financial and governance/monitoring layer. If the objective is to bring about systemic change, there is a need to design financial instruments that are coherent with that intent, including a shift towards a long-term investment perspective (whilst delivering results in the short term that can build momentum). Governance and monitoring and evaluation mechanisms will also need to be rethought to be consistent with the objective of system transformation. This might entail, for example, the design of financial instruments that allow different organizations to invest in a portfolio on a peer basis, and of monitoring approaches that allow for dynamic management of the portfolio and reporting on its results over time. This type of financial and institutional innovation will not happen overnight. To accelerate the process, an important task at this stage is to help open up possibilities, create a vivid picture of what are viable options to do things differently and get both UNDP and partners engaged in a process of reimagining what financing development work through a portfolio logic can look like. It is in this context that UNDP is looking for a consultant with a financial background that will support the work of designing the financial and monitoring/governing “layer” of the stack described above, and help with communication the principles for financial instruments that facilitate portfolio approaches to system transformation.
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