How to write your own value for Money case study
Accountability in Tanzania Programme
How to Write your own
Value for Money
Case Study
To be used together with the main report
‘Value for Money of AcT Partners Results’ accessible at
http://www.accountability.or.tz/?attachment_id=1035
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How to write your own value for Money case study
Background
As the case studies were being shared for
discussion with other partners, it also became
clear that partners would benefit from a much
more detailed example of how the metrics and
explanations for the different VFM elements
were derived.
This short note provides clarity on the basic
information that is needed to demonstrate
value for money (VFM), along with a step-bystep sample calculation of VFM, based on Case
study 1 of the main VFM Report. It shows how
the different VFM elements were established as
a guide for others who wish to use the approach
to document their own case studies.
Why you might want a case
study
In 2012 AcT intensified efforts to work with
partner organisations to strengthen their
capacity to document all the necessary details
needed to establish VFM of their interventions.
Such capacity building has been organized by
way of general and tailored training and has also
been in-built in various reporting requirements.
How to establish the different
VFM elements
In addition, AcT commissioned a study to
examine a sample of partner results with a
view to develop a set of case studies which
demonstrate the value of what is being achieved
by partner organisations. The intention was also
to develop an approach for establishing VFM
and to determine how it can be adopted for
application by partners more widely. To that
effect, the study identified specific metrics and
methods for calculating and explaining whether
or not a programme represents VFM.
The exercise documented five case studies from
different partner organisations. From that
experience, we have found that the exercise has
the potential to throw some useful light on the
work Civil Society Organizations (CSOs) and
donors do. However, we also recognise that
there are costs involved in the dedication of time
and energy to this process.
An important prerequisite to the documentation
of the five case studies was the availability of
clear information about the results that are
being achieved and the processes leading to their
achievements. This includes both the qualitative
and quantitative aspects of the results and the
mix of strategies employed. After all, VFM is not
just about numbers and quantitative measures as
sometimes the most important results do not
have monetizable or quantifiable value.
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To demonstrate the cost effectiveness of what
your organisation is doing, to demonstrate the
value of governance work to other programmes,
as well as to compare two kinds of similar
projects within your own organisation.
STEP 1: Produce an overview of the results
chain
When this overview is comprehensive enough it
provides an important starting point for accurate
estimation of the costs and benefits. The overview
needs to provide details of strategies employed
and justification for their choice because if the
reader does not understand the programme well
enough or the working context it can be too easy
to rush to incorrect judgment about the choices
made.
What to do:
 Conceptualize and document your results
chain from inputs to the specific higher level
result
 Ensure that your overview includes a
summary of the time taken, the costs
and benefits at each stage, together with
key aspects of the strategies and possible
alternative strategies that could be used in
delivering interventions.
STEP 2: Estimate the cost of the inputs to
produce the result
This step is where most of the work lies, especially
when cost estimates are not easily produced (e.g.
in the case of shared staff and activities). Clarity
on how these costs are estimated is important
because it will facilitate making comparisons
between programmes.
How to write your own value for Money case study
What to do:
 Identify the quantities and costs of each
input identified in your results chain. This
may include staff time (for all programme
and support staff ), materials, communication
and all logistics involved in undertaking
related activities by (a) your organisation
and (b) others e.g. community members’
inputs in form of time, money and material.
If the costs that are directly attributable to
the intervention are not easily determined,
then identify what is a reasonable basis for
calculating the costs. For example, is it
reasonable to attribute a proportion of ‘back
office’ time and costs? If so, what basis will
be used to attribute a reasonable proportion?
Similarly, when results are achieved by the
AcT partner working in partnership or in
a sub-contracting relationship with other
organisations, is there a justifiable way of
apportioning costs to get a full view of the
total inputs that contributed to achieving the
results in question?
STEP 3: Collect data on the monetary,
quantifiable and qualitative value of the result
(outputs and outcomes)
What to do:
 Collect accurate data on numbers of direct
and indirect beneficiaries (include clear
documentation of the assumptions made)
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 Clarify the basis for the estimates (whether
actual counts from programme offices or
estimates on the basis of a normally accepted
multiplier e.g. of 5 people per household,
or 250 people per water point as defined in
service standards).
 Where the results cannot be monetized or
quantified, explain why. It is important to
keep records of the qualitative aspects of
the intervention in terms of the qualitative
outcomes such as empowerment and rule of
law, because these have value even where it
can’t be quantified.
STEP 4 (Optional): Where feasible extrapolate
from the qualitative aspects to derive estimates
of value by using valuation methods.
What to do:
For the qualitative outcomes in Step 3 above,
determine if there are appropriate valuation
methods to estimate monetary value e.g.
contingent valuation methods.
Good examples of how you can achieve that are
available from www.sroi-africa.com
How to write your own value for Money case study
How to translate the VFM elements into a VFM analysis???
Based on Case Study 1: Oxfam’s Chukua Hatua programme in Mwime Village
Data Area
Specific Items
Overview of the
Result Chain
Mwime Village is adjascent to the Barrick Gold Mine Site in Shinyanga. For some time the village
has been working to set an appropriate mechanism to receive agreed sums of money from the mine.
After receiving Oxfam training as an animator, Maimuna, used the skills to inform other villagers to
organise and demand for action from village goverment. Villagers used their political representatives
and other allies to get the engagement of all parties and eventually the govenment and the mining
company responded and money was paid to the Village. For detailed information See page 4 of the
main report ..Background to Oxfams Intervention in Mwime Village
Quantity and cost
of inputs
Value
Description
Programme Costs
A. One Training session
for the animators
Tsh 6 Million
The entire training costed Tsh 6 million for 30 animators. Cost per animator is therefore Tsh 200,000/= (A1)
B. Two Mentoring
sessions for the animator
in two different districts
Tsh 10 Million
Two mentoring sessions were organised in two different
districts each costing Tsh 5 million. 10 animators
attended & therefore cost per animator was Tsh
1,000,000/= (B1) for both sessions
C. Ongoing costs borne
by the animator and community members
Not Valued
Time and resources spent in various meetings and
follow-ups and mobilising other community members.
Unfortunately there was no proper recording of this and
hence it is difficult to estimate the costs accurately
D. Cost borne by the
Tsh 500,000/=
parliament committee to
support community members efforts
Given as a gift to support opening of the village account
Back office costs
E. Oxfam’s staff costs
Quantity and
value of outputs
and outcomes
E. Operational & office
costs
Tsh 4.8 Million Oxfam estimates that admin costs including staff costs is
approx. 30% of programme costs (i.e 30% of 16 Million
invested for training and mentoring of animators). For a
single animator, the admin costs will be 30% (A1 + B1)
= Tsh 360,000/= (E1)
F. Initial payout to the
village account
Tsh 180 Million
G. Additional annual
payout amount for subsequent years
Tsh 60 Million
The company will continue to pay the Village Tsh 60
Million annnualy for the duration of the contract
H. Number of Direct
beneficiaries
3480 (1710
M,1770 F)
The funds are managed by the village government for
the benefit of the entire population of Mwime Village
. It is unlikely that the funds will be distributed among
villagers. Collective decisions on what the money will
be invested in will be made using normal planning and
budgeting procedures at the village level.
I. Indirect Beneficiaries
/ population of entire
Kahama District
1.3 million
Population of Kahama District, where Mwime Village
is located. These are considered indirect beneficiaries
because the expereince gained by Mwime Village and
the services or goods purchased by the funds is likely to
spill over to other adjascent villages
J. Value of infrastructure
from the funds received
This refers to the value of benefits that the villagers
are receiving as a result of the investment in above.
Information not yet available at the time of the study.
K. Ongoing costs borne
by the animator and community members
This refers to what the received funds were used for. This
information was not available at the time of the study
Other qualitative L. The intervention empowered the animators and eventually villagers in Mwime, strengthened
aspects/outcomes informaiton flow and networking between villagers and their elected reprsentatives and also
of the intervention strengthened the rule of law where provisions in the mining contracts were followed up and effected.
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How to write your own value for Money case study
Table 2: Estimating the VFM elements for the Mwime
Case based on data on Table 1 above
VFM
Category
Link to
Economy
Inputs
Key Questions
3. Is the result monetisable?
What is the cash value of the
gain?
3.2 Over five years
F+(G × 4yrs)
4. What is the ratio of input:
output? Towards cost per unit
output
(A+B+E)/F
Yes
3.3 Over 10 years
5. Can number of beneficiaries
be quantified?
5.1 direct beneficiaries
5.1.1 cost per direct beneficiary
5.1.2 value of gain per direct
beneficiary
5.2 indirect beneficiaries
5.2.1 cost per indirect beneficiary
5.2.2 value of gain per indirect
beneficiary
6. Can the outcomes be
monetised? (eg putting a cash
value on access to clean water)
7. Can the outcomes be
quantified?
Effectiveness Outcomes
F
F+(G × 9yrs)
H.
(A1+B1+E1)/H
unit costs as only
one of the trained
animators worked
in Mwime (F/H) for yr 1 + (G/H)
yr 2 onwards
I.
(A1+B1+E1)/I.
(F/I) for yr 1 + (G/I) yr
2 onwards
No –( J and K)
No ( J and K)
7.1 Over one year
7.2 Over five years
7.3 Over 10 years
8. Are the outcomes qualitative?
8.1 What are they?
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Judgment
Background to the
intervention and
comparison with
other programmes;
challenge to find
direct comparability
F
3.1 Over one year
Outputs
Basis for answer
and evidence
1. (a) What did it cost? -Total
(a) A+ B+E=Tsh 20.8m
programme costs
(b) Cost per unit input? - Cost
(b)
for the one village animator
A1+B1+E1=Tsh1.56m 2. Could the same input have
been generated for less?
Efficiency
Answer
Yes
L
How to write your own value for Money case study
VFM FAQs
1. Where can I get learning materials on Value
for Money?
AcT produced some for explaining the concept to
partner organisations in the programme. They are
available at: www.accountability.or.tz/learningprogramme-2/ - including a presentation and some
case study material
2. Producing a case study like this looks like a lot
of work! How could I use it?
Internally within your organisation (both the
executive and the Board) you could use it to
compare different programmes and different ways
to achieve your results. Sometimes organisations
carry on doing the same thing year after year
just because they always have done. It can be
a very refreshing way to look again at what you
do, and to assess which of the things you do are
most efficient and effective. Hence it provides
good evidence from which to make planning and
budgeting decisions.
 VFM is an increasing concern of donors at the
moment. Having a well documented case study
of this sort can be a very good way of showing
them that you are not only thinking about how
best to manage the costs of your programme
(always a good management practice that they
will be pleased to see!) but also that you are
looking further into issues of the effectiveness of
your work and being able to justify investments
made in terms of longer term results. If you are
able to take this even further into being able
to quantify some of the difficult concepts like
empowerment, you would really be getting ahead
of the game, including internationally! (see
for example, Jeremy Holland, ed (2013) Who
counts? The Power of Participatory Statistics,
Practical Action Publishing, Rugby UK. )
3. How do I go about calculating core costs?
Core costs are difficult to attribute because
they are, by definition, costs that persist
regardless of the projects that an entity
chooses to undertake. Examples of core costs
include rent for office space, communications
& IT, the cost of an annual audit and costs
of support staff. These costs benefit the
organization as a whole but their contribution
to specific projects is indirect. Even though
these costs are indirect, they must be factored
into VfM calculations because they are a real
cost of implementation.
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There are quite a number of legitimate
methods for allocating core costs and the
selection of an appropriate method is an
internal decision that is influenced by any
number of unique factors, including the
stage of growth that your organization has
reached.
In terms of VFM, the credibility of
your calculations will depend on your
organization’s ability to demonstrate a
fair and realistic allocation of core costs
across projects. It is also important to
remember that the decisions you make about
apportioning core costs will affect your VfM
either positively or negatively. Therefore,
it is important to look for the appropriate
methods to estimate true cost of an initiative
without overstating or understating the core
costs that are attributable to it.
4.How do I assign or estimate monetary
values for qualitative aspects of
programme results? –
Arguably this is one of the most challenging
aspects of establishing VFM but one
that must be taken care of especially for
governance related programmes since
the expected results will include a good
number that are qualitative in nature e.g.
Empowerment or strengthened rule of law
and human rights.
Some qualitative results will be easier to
assign monetary value to than others; ones
where there are already clear established
standards. For example, if the result is an
observable general improvement of older
persons health as a result of advocating for
their rights to free medical services, one
could adopt the use of Disability Adjusted
Life Years (DALY), an approach that was
developed in 1993 by Harvard and the World
Bank and adopted by WHO. It is possible
to attach a monetary value to DALYs
and there are standard values developed
for different countries and for different
conditions available in the WHO website.
Because DALYs are non-financial metrics
you need to attach a monetary value to it
and Lvovsky et al (2000) is a good reference
for approaches on how to attach a monetary
value to established DALYs.
How to write your own value for Money case study
What is required is to determine the most
appropriate valuation method to estimate
a monetary value. Good examples of how
other programmes have done this are
available from www.sroi-africa.com. From
the examples it will be possible to determine
which of the approaches is most suitable for
your own case.
5.
Doesn’t this force me to claim my
organisation caused a result on its own,
when we know what we did was make a
contribution to a process in which others
were involved?
It has to be admitted that this is a risk. Two
important steps are
(a) to make very clear in the write up to your
case study that you value the contributions
from others that have been involved - that
the result could not have been achieved
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without them, and that you are not setting
out to ‘over claim’ what you have done.
(b) wherever possible try to calculate the
value of those contributions. Particularly
important is to put a value on ‘community
contributions’, as these are often assumed in
development projects but not made explicit.
For example, the time community members
spend collecting data for community
scorecards can be assessed. The very
minimum would be at the rate of casual
labour in that area, but actually the work is
more technical and demanding than that,
and requires a level of education to do well.
One way would be to ask those doing the
work what is the ‘opportunity cost’ of getting
involved – i.e. what would they have been
doing if they hadn’t been participating in
the activity and what could they have earned
doing that other work?
How to write your own value for Money case study
For further informantion:
Programme Director
Accountability in Tanzania (AcT)
11th Floor, PPF Tower | Garden Avenue/ Ohio Street | P.O. Box 1160
Dar es Salaam, TANZANIA
Phone: +255 22 2122003 | Fax: +255 22 2113343
Website: http://www.accountability.or.tz