Evaluation is the analysis of data collected throughout the monitoring process. While monitoring is almost always done within the organization by its own staff, sometimes the donor requires that the evaluation is done by outsiders like consultants as objectivity can be important.
With the evaluation, organizations want to find out if the project was worthwhile, achieved its goals, and was implemented efficiently. Normally this happens at the end of the project cycle. In an evaluation you also see if there have been any unintended outcomes and if they were negative or positive.
The evaluation normally comprises a cost-efficiency analysis to see if the money was spent responsibly and efficiently. In the case of underperformance in specific outcomes, the evaluators analyze the reasons for this underperformance to be able to know if they were external or internal.
Why does a donor require you to do an Evaluation?
In general, during the evaluation process, it is determined what should be learned through the implementation and what are lessons for the future and for future projects. An evaluation makes it easier to learn from past experiences, as mistakes will not be repeated. Particularly unintended outcomes will come to the surface.
With the results of the evaluation process, project planners decide if an approach is worth repeating or if it needs adjustments. Results will also be reported to the donor and other stakeholders to prove that resources have been used economically and successfully. A good evaluation strategy gives legitimacy to your organization and your projects.