Governance & Organization Structure

CBDC ORGANIZATIONAL MODELS

MODEL 1: INTERNAL PROGRAM
├── Location: Within central bank structure
├── Reporting: To existing department head
├── Staff: Mix of existing and new hires
├── Budget: Central bank operational budget
├── Best for: Initial research, smaller banks, limited scope

MODEL 2: DEDICATED ENTITY
├── Location: Separate unit or subsidiary
├── Reporting: To governor or board directly
├── Staff: Dedicated hires, secondments
├── Budget: Ring-fenced allocation
├── Best for: Serious implementation, larger banks

MODEL 3: PUBLIC-PRIVATE PARTNERSHIP
├── Location: Joint venture or consortium
├── Reporting: Shared governance
├── Staff: Mixed central bank and partner
├── Budget: Shared funding model
├── Best for: Technology development, capability gaps
```

RECOMMENDED CBDC PROGRAM STRUCTURE

┌─────────────────────┐
│ GOVERNOR/BOARD │
└─────────┬───────────┘
│
┌─────────▼───────────┐
│ STEERING COMMITTEE │
│ Monthly meetings │
└─────────┬───────────┘
│
┌─────────▼───────────┐
│ PROGRAM DIRECTOR │
│ Full-time, senior │
└─────────┬───────────┘
│
┌─────────────────────┼─────────────────────┐
│ │ │
┌───────▼───────┐ ┌───────▼───────┐ ┌───────▼───────┐
│ TECHNOLOGY │ │ POLICY/LEGAL │ │ OPERATIONS │
│ STREAM │ │ STREAM │ │ STREAM │
└───────────────┘ └───────────────┘ └───────────────┘
```

DECISION RIGHTS MATRIX

LEVEL 1: BOARD/GOVERNOR
├── Go/no-go for major phases
├── Launch decision
├── Major policy decisions
├── Budget allocation (annual)
└── Frequency: Quarterly

LEVEL 2: STEERING COMMITTEE
├── Phase gate approvals
├── Scope changes
├── Timeline adjustments
├── Resource reallocation
└── Frequency: Monthly

LEVEL 3: PROGRAM DIRECTOR
├── Day-to-day prioritization
├── Staff assignments
├── Vendor management
├── Technical decisions
└── Frequency: Continuous

LEVEL 4: STREAM LEADS
├── Implementation choices
├── Task assignment
├── Quality assurance
└── Frequency: Continuous
```

CBDC PHASE GATES

GATE 0: INITIATION
├── Decision: Proceed to exploration?
├── Deliverable: Exploration mandate
└── Approver: Board

GATE 1: FEASIBILITY
├── Decision: Proceed to development?
├── Deliverable: Development proposal
└── Approver: Board

GATE 2: DEVELOPMENT COMPLETE
├── Decision: Proceed to pilot?
├── Deliverable: Pilot-ready system
└── Approver: Board

GATE 3: PILOT COMPLETE
├── Decision: Proceed to production?
├── Deliverable: Production-ready system
└── Approver: Board

GATE 4: PRODUCTION LAUNCH
├── Decision: Go live?
├── Deliverable: Live CBDC
└── Approver: Board
```

CBDC CORE TEAM (Pilot Stage): 25-35 FTE

LEADERSHIP (3-5 FTE):
├── Program Director
├── Technology Lead
├── Policy Lead
└── Operations Lead

TECHNOLOGY STREAM (12-18 FTE):
├── Platform team (4-6)
├── Security team (3-4)
├── Testing team (3-4)
└── DevOps (2-4)

POLICY/LEGAL STREAM (5-8 FTE):
├── Legal counsel (2-3)
├── Policy analysts (2-3)
└── Economist (1-2)

OPERATIONS STREAM (5-10 FTE):
├── Project management (2-3)
├── Communications (1-2)
├── Support (2-3)
└── Training (1-2)
```

RECOMMENDED TEAM SOURCING MIX

Internal transfer: 40-50%
├── Culture knowledge
├── Relationship capital
└── Institutional continuity

External hire: 20-30%
├── Specific expertise
├── Fresh perspective
└── Industry knowledge

Contractor: 15-25%
├── Flexibility
├── Peak capacity
└── Specialized skills

Vendor resources: 10-15%
├── Platform expertise
├── Implementation experience
└── Training support
```

ORGANIZATIONAL FAILURE PATTERNS

FAILURE 1: PART-TIME TEAM
├── Symptom: "CBDC is part of my job alongside..."
├── Impact: Delays, quality issues
└── Fix: Dedicated resources

FAILURE 2: WRONG LEADERSHIP
├── Symptom: Leader lacks authority or credibility
├── Impact: Governance paralysis
└── Fix: Senior, capable, dedicated leader

FAILURE 3: INSUFFICIENT BUDGET
├── Symptom: Constant funding requests
├── Impact: Corner-cutting, delays
└── Fix: Realistic budgeting with 50% contingency

FAILURE 4: GOVERNANCE PARALYSIS
├── Symptom: Decisions take months
├── Impact: Missed timelines
└── Fix: Clear decision matrix

FAILURE 5: ISOLATED TEAM
├── Symptom: Core departments uninformed
├── Impact: Internal resistance
└── Fix: Integration roles, communication

FAILURE 6: SCOPE CREEP
├── Symptom: "Just add one more feature"
├── Impact: Never-ending project
└── Fix: Strict scope control
```

CBDC BUDGET FRAMEWORK (5-Year Program)

PHASE 1: EXPLORATION (Year 1)
├── Team: 10-15 FTE
├── Annual budget: $3-8M
└── Focus: Feasibility, planning

PHASE 2: DEVELOPMENT (Years 2-3)
├── Team: 25-40 FTE
├── Annual budget: $15-30M
└── Focus: Build, integrate

PHASE 3: PILOT (Year 3-4)
├── Team: 35-50 FTE
├── Annual budget: $20-40M
└── Focus: Test, learn

PHASE 4: PRODUCTION (Year 4-5+)
├── Team: 50-100+ FTE
├── Annual budget: $25-50M+
└── Focus: Scale, operate

TOTAL 5-YEAR: $100-250M+
Add 50% contingency to estimates
```

✅ Dedicated resources are essential: Part-time teams fail consistently.

✅ Leadership quality matters: Program director capability correlates with success.

✅ Integration prevents resistance: Isolated programs face internal opposition.

🔴 Underestimating resources: Creates quality problems costing more to fix later.

🔴 Governance complexity: Overly complex structures create paralysis.

🔴 Part-time leadership: Insufficient attention guarantees problems.

Time investment: 2-3 hours

Q1: Minimum FTE for CBDC pilot stage?
A) 5-10 B) 25-35 C) 75-100 D) 150+
Answer: B

Q2: Most common organizational failure pattern?
A) Too many resources B) Part-time team C) Over-governance D) Too much integration
Answer: B

Q3: Who should chair steering committee?
A) External consultant B) Vendor C) Deputy Governor D) Junior manager
Answer: C

Q4: Budget contingency recommended?
A) 10% B) 25% C) 50% D) 100%
Answer: C

Q5: Realistic 5-year CBDC investment?
A) $10-20M B) $50-75M C) $100-250M+ D) $500M+
Answer: C

End of Lesson 7