Use of formal and informal evaluation in institutional strengthening: The case of a village hydro project in Sri Lanka

Evaluation is an important management tool used by managers and beneficiaries of development projects. However, until recently, only the managers and external agencies evaluated project benefits, and there was little interaction with the beneficiaries. This approach to evaluation ignores the locally available evaluation capacity that could be harnessed not only for meaningful evaluation, but also for rational decision-making at the project level. This article, using some experience from a Village Hydro Project in Sri Lanka, demonstrates the value and relevance of using local capacity in project evaluations. When local capacity is combined with external formal evaluation exercises, not only does the evaluation become more enlightened and participatory, but more importantly, the beneficiaries become partners in development. The article argues that such local capacity could start as an informal evaluation system that could gradually be transformed into a formal evaluation system.