1. Understanding context
The factor mentioned most often when asked about the success or failure of a BDS engagement was whether or not the BDS provider had a robust understanding of the context shaping the FSP’s business. In addition to basics, such as sharing a working language with staff and understanding the country of operations, multiple FSPs mentioned the need for providers to tailor their understanding and recommendations to individual circumstances, rather than applying a one-size-fits-all approach.
Or, as one FSP eloquently submitted, “prescribing a solution without taking into consideration the context.”
Sharing their experience, one respondent wrote, “The key elements were engaging the clients and the staff to be able to ascertain the needs of the clients and the right solution to address the needs.”
Another respondent identified “the ability for BDS not to assume a lot of things or to try to bring their experience from other areas into the business. Once we got them on board regarding our real realities and context, they were able to provide services that assisted, especially in loan officer training.
2. Expertise and credibility
Unsurprisingly, another key success factor is the expertise and credibility of the BDS provider. When asked what contributed to poor BDS outcomes, one FSP decried “unclear deliverables, lack of professionalism, incompetent consultants.” While another discussed their positive experience with “consultants [from] a branch of the World bank – key element: their professional authority.”
When structuring BDS engagements, donors and FSPs should strongly consider to what extent the BDS engagement will integrate with and strengthen existing business processes.
As one respondent volunteered, “External BDS providers that are embedded within our FSPs are the most functional, particularly when they are available to implement recommended processes and changes.”
Similarly, a different respondent identified their key challenge as “short-term BDS providers that present vague frameworks and do not implement in-line with our teams.”
4. Buy-in and alignment
Finally, and particularly important for donors that fund BDS services for FSPs, was the issue of buy-in. Multiple respondents discussed experiences in which externally funded BDS did not match the FSP’s perception of their own needs—as one respondent summed up, “imposed on us by donor and bad alignment.” Without the necessary buy-in within the organization, respondents flagged scenarios in which there was “no attention from the management, no commitment, and no political support of the management.” A participatory approach to determining the appropriate BDS or capacity building solution for a particular FSP can help avoid scenarios in which fees and effort lead to disappointment rather than success.