The Bank needs to make substantial changes to the matrix system to realize its full potential and reduce its downside by addressing three inter-related sets of recommendations on incentives, processes, and structural issues:
- Incentives. To operate the current matrix system effectively, the World Bank needs to enhance incentives and resources to promote sharing of knowledge and revamp the performance management system to reward quality and results.
- Processes. The Bank needs to replace sector strategy papers by more modest “state-of-the-sector” reports and invest more in strategic economic and sector work and business development. The Bank also needs to enhance the focus on technical quality by strengthening the mechanisms and accountability for quality of lending and knowledge products and simplifying budgetary rules for collaboration across organizational units.
- Structure. There is a need to develop and implement a plan to enhance matrix effectiveness that addresses existing constraints in the sector and network architecture, strengthens links among the Regions and anchors, and rebalances the relationship between country and sector units in the Regions. Key organizational constraints in the Sustainable Development Network also need to be addressed.