Sound management development programs are a major technical assistance need of Third World water and sanitation institutions. This manual presents a three-phase training program which teaches the modern management concepts and skill-building techniques needed to enhance management effectiveness. Based on successful field work in Sri Lanka, the manual is designed for use by project designers, managers, and trainers, and includes handouts, case studies, and other materials needed for a complete training program. Also included is practical guidance to enable users to adapt the manual to specialized uses. Phase I introduces basic management theories and methods: organization and delegation of work, monitoring and follow-up, collaboration and feedback, effective communication, team building, conducting productive meetings, and applying management skills on the job. Phase II reviews the on-the-job implementation of these skills and discusses them in greater detail. This phase highlights difficulties in achieving managerial behavior change, as well as problems in implementing new management systems. A new theme is then introduced: improving team performance by developing unit and mission goals, by defining performance standards, and by planning for application and follow-up. Phase III provides a practical synthesis of the program's concepts and skills in an effort to operationalize the unit and organizational-wide performance standards that were developed in Phase II. Session topics discuss goal establishment, using performance indicators, and clarifying management priorities.