Output. The average number of visits per CBD agent in some given period of time is the optimum output variable. The reason for this is that higher remuneration presumably encourages workers to spend more hours on the job and to produce more visits (i.e., to make contact with a greater number of potential clients), irrespective of other aspects of the job environment, including the demand for services and other program policies that affect whether contraceptives are provided or referrals are made during a visit.
Of course, CBD agents make many types of visits: In some, they provide methods; in others, they make referrals; and in still others, they attempt to motivate women to accept family planning services. The last category includes contacts in which women accept methods, as well as those in which they do not. The goal of any program is to increase contacts in which new acceptors are recruited, continuing users are resupplied or a referral is made that leads to a clinic visit. Whether visits prove "successful" is therefore affected by both the worker's effort and the potential client's interest, and thus by demand factors that are unlikely to be related to workers' remuneration.
However, only one of the three programs (SDA) had information on total visits made by agents. Consequently, we were forced to use a less-satisfactory index of work performance, based on the number of visits in which a client was provided with contraceptives or was referred to a clinic for family planning services. (Referrals for other services were excluded from the analysis.) This measure may be affected by demand-side factors; thus, the impact of remuneration on work performance may be somewhat obscured. However, other analyses show that agents' performance is similar regardless of an area's prevalence, so the role of demand in affecting agent performance may be small.5
The average number of visits made by agents varies by gender, and the programs vary in their mix of male and female agents. We therefore adjusted the output variable to control for this difference: On average, female agents make 8.2% more visits than male workers.6 Thus, under the assumption that all agents were female (as in SDA) and that differences in productivity according to gender were the same for each program, we inflated the number of visits per agent in the FPU and UMATI programs (where agents are both male and female) by 8.2%.
While it might seem appropriate to use couple-years of protection as the measure of output, this turns out to be a poor choice because it is affected by supply factors that are independent of remuneration. These include variations by program in the number of oral contraceptives and condoms distributed during an average visit and in the method mix. A program that distributes more of any method per visit may produce more couple-years of protection and therefore may appear to be more cost-effective, but the reasons are unrelated to remuneration. Another supply issue concerns method mix. SDA provides mainly pills; in the other programs, the mix is more evenly distributed between pills and condoms. One reason for this difference may be that the ratio of male to female agents varies; females tend to provide more pills than males, while both provide about the same number of condoms.7
Data Collection
We obtained data on costs from program managers and financial records for 1995 and 1996 for UMATI and SDA, and for 1995 only for FPU. Costs were divided by the number of agents working in each year to calculate the annual cost per agent.
SDA was the only program that paid a salary to its agents. FPU provided a small allowance to some agents for bicycle maintenance. The three programs made different types of in-kind contributions to their agents. Each contribution can be classified as a capital good. To make costs comparable with those for items that are used up in a year, we annualized the cost of capital goods or spread it over the useful life of the item.* The annualized cost was divided by the number of agents in each program to determine the value of in-kind contributions per agent.†
Each CBD program has two types of supervisors. Immediate supervisors are responsible for regularly checking on agents, while upper-level supervisors generally are responsible for managing immediate supervisors. Payments to supervisors include salaries and benefits, travel allowances and transportation costs for time spent on field visits. In the UMATI program, selected CBD agents worked as immediate supervisors. To facilitate the analysis, we treated all supervision costs incurred by these agents (including travel costs and the cost to train them to be supervisors) as payments to agents.
Information was obtained from program managers on the salaries and benefits paid to immediate and upper-level CBD supervisors. Many of the supervisors have additional duties that are not related to CBD activities, and it is therefore not appropriate to charge their total remuneration to the CBD program. To address this problem, we interviewed supervisors in two districts in each program and asked them to estimate the proportion of time they spend per week on CBD activities. We used this information (shown in Table 2) to allocate a proportion of the salaries and benefits of supervisors to the CBD program. Remuneration attributed to CBD supervision was then divided by the number of agents to determine the cost per agent of salaries and benefits.
In each program, the upper-level CBD supervisors are provided with vehicles and travel allowances for transportation to meet immediate supervisors. The programs do not support transportation used by immediate CBD supervisors. We also measured per diem expenses and vehicle operating costs associated with supervisor transportation.‡ The sum of these costs was divided by the number of CBD agents to calculate the supervisor transportation cost per agent.
Information on annual training costs and the number of agents and supervisors trained was obtained from program expenditure accounts between 1993 and 1996. Training costs include those for travel and per diem for both trainers and trainees, the costs of supplies and any rental fees. The costs of the training seminars were annualized.§ The cost of training immediate supervisors was divided by the number of agents to determine the supervisor training cost per agent. All programs use either personnel from FPU or their own staff to carry out training sessions, but the costs of these staff are not available and are excluded from the analysis.
Data on the output variable—agents' visits—were obtained from the headquarters of each program. The annual number of visits produced by each program was divided by the number of active agents in the same period to calculate the average annual number of visits per agent. (The annual number of CBD agents was adjusted to account for agents who did not work for the entire year—agents who dropped out or who received their initial training during, and not at the beginning of, the year.)
Results
Cost per Agent
SDA agents receive compensation totaling US$398—about nine times the total received by UMATI workers and 12 times that received by FPU agents (Table 3).
Total per-agent payments to supervisors also are higher in SDA ($239) than in FPU ($214) or UMATI ($33**). However, while supervisors' salaries are higher in SDA than in FPU (not shown), the ratio of agents to immediate supervisors is also higher in SDA; as a result, supervisor costs are spread over a greater number of agents, and supervisors' salaries and benefits, calculated per agent, are 27% lower in SDA than in FPU. Average travel costs per supervisor are highest in SDA ($75, compared with $5-11 in the other programs), reflecting that area managers travel frequently because they are responsible for a large number of agents.
Training costs per agent vary greatly; total costs at FPU ($312) are substantially higher than those at the other programs ($64-78). It is difficult to explain why these costs vary so much. The main difference is in the costs of refresher training (not shown), although policies regarding refresher training are the same in all three programs. Some combination of the following factors may also contribute to the variation: FPU may incur higher costs for venues, travel and per diem, and may have smaller class sizes, than the other programs. Training costs of supervisors per agent are far higher for FPU ($80) than for SDA ($8). FPU supervisors spend only 40% of their time supervising agents; therefore, more supervisors must be trained for FPU to have a training coverage rate similar to that in other programs. Also, only FPU provides refresher training for supervisors. UMATI supervisors are selected from among agents, so there are no additional training costs.
Total costs per agent are far lower in UMATI than in the other two programs (Table 3). In fact, the cost per agent in UMATI ($155) is only slightly more than 25% of the cost per agent in FPU ($558), even though payments to agents are higher in UMATI than in FPU. Furthermore, total per-agent costs at SDA ($701) are only about 25% higher than those at FPU, even though SDA's per-agent compensation is more than 10 times that of FPU. Thus, a program that makes only small payments to its agents will not necessarily have the lowest total cost per agent, and a program that spends a lot on agent compensation may not have commensurately higher costs per agent.
Output per Agent
Not unexpectedly, the annual number of visits per agent is by far highest (425) in the SDA program, in which agents are full-time, salaried workers (Table 4). FPU and UMATI agents make 105 and 132 visits per year, respectively. (These numbers rise to 113 and 143, respectively, when adjusted for gender differences.) In addition to remuneration policies, location may explain some of the difference in the number of visits made by SDA workers and others, since SDA agents work in urban areas, while most agents in the other two programs work in rural areas.††
Effects of Remuneration Policies
Costs per visit are lowest in UMATI, somewhat higher in SDA and far higher in FPU (Figure 1, page 194). While SDA has the highest number of visits per agent, UMATI has far lower costs per agent, so it also has the most favorable cost-per-visit ratio. If only payments to agents are considered, then FPU has the lowest cost per visit. However, when indirect effects are taken into consideration, UMATI's cost per visit is the lowest.‡‡
While it seems intuitive that higher agent compensation would lead to higher costs per visit, this often turns out not to be true, as shown by the results of simulations assuming varying levels of spending on training and supervision. When the sum of training and supervision costs is high (as in SDA), an increase in compensation to agents leads to a reduction in costs per visit (Table 5).§§ This occurs because indirect effects dominate; that is, the larger number of visits made by more highly compensated agents more than outweighs any increase in costs that arises because agents are more highly paid. By contrast, when training and supervision costs are low (as in UMATI), the cost per visit varies little by difference in compensation of agents.
One possible explanation for these findings is that agents respond to increases in compensation by working longer hours and making additional visits, and that training and supervision may affect the quality of visits without increasing their quantity. This explanation seems reasonable, given that the number of visits is largest in SDA, the organization with the highest compensation per agent, and smallest in FPU, the organization that has the lowest compensation per agent.
The important conclusion from this part of the analysis is that the impact of agent remuneration on cost per visit cannot be evaluated by focusing on compensation alone. When the effects of supervision and training costs are taken into consideration, UMATI and SDA have lower costs per visit than FPU, because they have either low costs for these program functions (UMATI) or a high number of visits over which they divide these costs (SDA). In the latter case, the high compensation of agents in SDA likely results in a large number of visits per agent. When training and supervision costs are high, as they are in both SDA and FPU, a large number of visits is necessary to generate a reasonably low cost per visit. This is the case for SDA but not FPU. SDA's higher compensation is more than offset by its higher number of visits, resulting in a much lower cost per visit at SDA than at FPU.
Conclusions
When only payments for agents are considered, FPU has the lowest cost per visit. However, when other costs are taken into account, FPU turns out to have the highest cost per visit. This is because low compensation results in a low number of visits; the indirect effect is high costs per visit, when the costs of supervision and training are taken into consideration.
In the three programs we analyzed, remuneration was positively associated with the number of agent visits. Although agents in both UMATI and FPU receive only in-kind compensation, the higher payments in UMATI are associated with a greater number of visits per agent than occur in FPU. In SDA, the program in which agents are paid a salary, visits are far more numerous. However, we were unable to control for factors that affect job performance over and above those analyzed in this article. Program factors that are hard to measure, such as the loyalty of workers and their willingness to work long hours with small rewards, simply cannot be captured in this kind of analysis. Moreover, the greater amounts spent on training and supervision in SDA and FPU may have had a positive impact on both the number of visits and their quality. Previous research, however, indicates that reducing supervisory visits may not affect agent performance.8This is because supervisors may use their visits to collect revenue and resupply agents rather than to provide them with motivation to improve their output. However, research from Mali suggests that refresher training may have a positive impact on the performance of CBD agents.9
The UMATI program has the lowest cost per visit because it has consistent policies regarding remuneration, training and supervision. Remuneration is low because agents are volunteers and select their own hours of work. At the same time, in designing its supervision and training strategies, the organization either explicitly or implicitly recognizes that its agents do not work full-time. Supervision and training strategies are low-cost and are consistent with a program that does not have very high output per worker.
By contrast, FPU pays its agents little, and like UMATI workers, they select how much time they wish to spend working. However, FPU's high costs of supervision and training seem inconsistent with a program that employs workers who receive little compensation. SDA has high payments to agents, and spends about the same per agent on supervision and training as does FPU. However, it makes more sense for SDA to invest in training and supervision, as its agents produce more output and work for a longer time.
Costs vary in these programs, and much of the variation may be explained by policies not associated with remuneration; this is apparent in that the two programs that pay agents in-kind have very different cost structures. This finding suggests that a broad focus should be taken in examining costs of CBD programs. While it is important to examine the impact of remuneration, such a focus may be too narrow. For example, programs may spend little on remuneration but large amounts on training or supervision. The challenge is not simply how to compensate agents so as to get the most output per dollar spent on compensation. The larger concern is how to allocate funds for the CBD program among the various strategies for improving performance: agent compensation, supervision, and agent and supervisor training. Some programs that spend little on compensation might improve performance by spending more on compensation but less on training or supervision. For example, FPU could consider using more of its budget to compensate agents while reducing other costs.
Our results have important implications for the financial sustainability of CBD programs. In preparing for declines in donor funding, programs need to take a broader approach than simply slashing salaries or payments to agents. The full budget should be examined so as to determine how the program could best survive with less funding from donors.