"If it is not broken, do not fix it... |
Friday, 13 September 2002 | |
Do we need to make society more aware of the benefits of the land administration system? We are all convinced that a functioning land administration system is an essential part of the legal and institutional framework of all European countries. The European Human Rights Convention prescribes its establishment and maintenance. Economic activities, investments into real property, housing development, agriculture, land use planning, build-out of infrastructure and urban development require an effective land administration system. I recognize that in some countries the Government is reluctant for various reasons (politics, incompetence, lack of funds) to set priorities for the improvement and further modernization of the land administration. („If it is not broken, do not fix it.”)
Suggestions for an awareness campaign and a business plan
Reinhold Wessely UN ECE WPLA Workshop 13 September 2002, Vienna Introduction and background We are all convinced that a functioning land administration system is an essential part of the legal and institutional framework of all European countries. The European Human Rights Convention prescribes its establishment and maintenance. Economic activities, investments into real property, housing development, agriculture, land use planning, build-out of infrastructure and urban development require an effective land administration system. The question in front of us essentially wants to address the need for continuous investments into the land administration system. It leads to the next questions:
If these questions are being answered in the negative, the land administration system will not obtain the funds needed to maintain and improve the system, with all the negative consequences for the economy. 1. Analysis - the awareness in Western European and reform countries
In Western European countries we can observe:
In the reform countries, additional problems exist:
The dangers of such conditions are manifold. Necessary investments for the improvement, maintenance and further development are difficult to finance. As a result, services need to be reduced or – conveniently – further privatization of services is called, for which might lead to less accuracy, less timeliness of data availability, or less reliability of data necessary for economic activities and transactions, or – to avoid that – to a substantial increase in the user fees.
2. Personal opinion on the privatization of land administration services
At this point I want to express a personal opinion on the ongoing discussion about privatization of land administration services. This opinion is based on observations made as advisor or project manager in a variety of countries in Central and Eastern Europe and Central Asia. I recognize that in some countries the Government is reluctant for various reasons (politics, incompetence, lack of funds) to set priorities for the improvement and further modernization of the land administration. („If it is not broken, do not fix it.”) On the other hand, the private sector might be more effective to run a land administration system – or parts thereof – but is much more susceptible to (1) overcharging for services (which would lead to an „under-use” of the system with all the consequences) or (2) corruption. Control mechanism is difficult to establish and to maintain. For all of these reasons, I would plead for a general model, which could briefly described as follows:
3. Why do land administration institutions need a marketing plan?
Land administration systems still – to a large extent – are financed by government budgets. Increasingly, budgets are restricted by austerity measures and determined by – sometimes more glamorous – political priorities. The collection of fees for the use of the system in many instances also is limited for popular political reasons. As a result of the limitation of resources, services might have to be reduced, services privatized and the overall quality and the extent of the services is provided by the land administration system might suffer. In the reform countries, the reconstruction of the land administration system is not completed yet and needs a huge amount of funding through budgets, international programs and loans and fees. In order to overcome these deficiencies, the land administration system needs to turn to the decision maker in a professional manner to create understanding of the underlying problems and to influence the decisions by arguments. A business/marketing plan is the professional tool for such a campaign.
4. Suggestions for business/marketing plan
A business plan of a land administration system is a joint effort of all institutions, public and private, involved. The first step, therefore, is to create a community of joint interests between the government agencies (cadastre and real property registration agency) and the private sector intermediaries, as notaries, surveyors, attorneys, realtors and banks. Such a concerted effort also would make the funding any campaign easier. A business plan of a land administration system has to determine (1) the target group to whom the efforts are directed, (2) the products and services provided, (3) the tools and instruments used for the operation and (4) the desired results of the business.
4.1 Target groups
Obviously, a land administration system in its effort to win understanding has to address several different groups: (1) the parliament and governmental institutions, which decide on its budget, (2) the general public, which has to understand that the operations and the development of the land administration system has to be financed increasingly by user fees, and (3) special partners, as the notaries, attorneys, surveyors, realtors, banks as their business is closely related – and dependent upon – the functioning of the land administration system.
4.2. Products and services
The products and services offered by the land administration system – in part as through outsourcing of the original services, or through public/private partnership constructs – and the benefits to the target groups constitute the arguments used in a business plan and marketing campaign. Such a campaign has to explain – on a cost/benefit basis – how important and beneficial the provided products and services are for the overall economy and for special interests of the target group.
4.3. Desired results
Such a campaign should achieve the following results:
5. A marketing concept for a land administration system - business approach
In order to conduct an effective marketing (awareness) campaign as described above, the land administration system should develop a business plan similar to any commercial entity. It starts with the identification of its position in its specific market as schematically shown on the table below. The land administration system, which is historically determined by government structures and methods of operation has to assume the character of a business in terms of management, clients (not applicants), products and services (tailored to the needs of the clients), pricing of products and services based on costs (cost recovery) or values perceived, on revenues to obtain for the lifelong existence of the system.
5.1. Consumer market vs. producer market?
Historically, a land administration system produced products according to a legal command. It was a distribution of a product, not a service provided upon the demand of clients. In a modern, democratic society, citizens have become clients. And, thus, also a land administration has to ask for what its clients want and need. People expect from the administration system immediate execution of the application (for registration), or prompt availability of information, which has to be accurate and cheap. At the same time, though, clients do not recognize easily anymore the value (and the related costs) of preparing and maintaining the core functions and data of the cadastre and the real property rights registration institutions, because they use the privatized services of intermediaries (notaries, surveyors, attorney, realtors, banks).
5.2. Analysis of needs
An analysis of the needs of the land administration system, clients probably (it should be ascertained by a professional marketing survey) would yield the following results:
5.3. Analysis of products and services The principal products and services the land administration can offer are:
5.4. Analysis of competitors
Although the core of the land administration system is in the public domain, and, thus, constitutes a monopoly, certain, privatized peripheral functions might develop faster than the core basis, which is being neglected or underdeveloped due to lack of funds. To remedy the situation, the relationship between the public domain core function and the privatized peripheral services has to be monitored and a balanced development has to be secured. The land administration system has to be kept competitive by innovation through new investments into technology and the customer orientation of services. A business plan as the instrument to meet these challenges has to be developed.
5.5 The lifeline of an enterprise
In the business world we are used to cyclical development of a business. From a modest start-up, a business is being developed to the peak of its existence. It is where complacency sets in and competitors start to attack the market position. If the warning signs are not seen early enough, a business will slide down the path to death. The critical (turning) point is at the peak where new products and services, new clients or other new innovative means have to be developed to stay alive. These rules also are valid for a land administration system, although the process of development might differ in terms of time and absoluteness of sequences, but the pattern itself should be a warning to consider always new ways, products and services and approaches to stay in business for the clients.
6. Mission, goals and strategies
6.1 Mission of a land adminisitration system
The mission of a land administration system is:
6.2. Goals of a land administration system
The goals of a land administration system can be determined along the TOR of the UNECE WPLA Guidelines in essence as follows:
6.3. Sample strategies for a land administration system
Strategies have to be developed on how to achieve these goals. Highlights of such sample strategies are:
6.4. Marketing instruments
We have several instruments for the marketing of the land administration services at our disposal:
Summary conclusions
From the above, clear conclusions can be drawn: |