Perspectives on Utility Benchmarking

1. Perspectives on Utility Benchmarking Piers Cross

2. What is Benchmarking? • Systematic tool that allows comparative performance assessment (indicators for organizational processes, outputs) against best practices • Traditionally measures performance on same organization/processes over time • Can be used internally, competitively within similar or different industries or collaboratively

3. Performance Assessment + BM Actions to Improve Performance Performance Improvement Types of Benchmarking • Metric BM – showing quantitative measurement of differences in performance indicators indicators over time, e.g IBNET – shows gaps Doesn’t necessarily explain causes of gaps • Process BM – management analysis of selected processes, comparing and learning from highest performers. Process BM uses metric data but selects and studies key processes. Focus on single processes, can miss context • Consumer/Customer/Citizen Perceptions - Report Cards, surveys can reveal gaps between consumer and provider perceptions, over time helps policy-makers evaluate utility performance. Needs repeated, independent surveys, hard to finance. • Model Approach – Comparative performance analysis against an theoretical or ideal “model company” of efficient processes Can miss context influences

4. Vision of WSS Utility Benchmarking • Utilities are entry points to improve WSS management and meet MDGs and beyond • Benchmarking can improve performance of WSS Utility operators by: • Creating knowledge for informed decisions • Improving the impact from investments • Sharing comparative knowledge, especially successes • Tool for sector analysis and advocacy • Building capacity of weaker utilities and incentivizing high performers • Mutual support between utilities

5. Agree or Disagree? • The diversity of WSS Utilities in Africa makes them well-suited to benchmarking • Competitive performance data of water utilities in Africa provides the incentives make the tough decisions to improve utility performance? • Utility performance in Africa is significantly related to access and use of comparative performance data? • The experience of twinning between high performing and improving utility shows a marked improvement in weaker utility performances?

7. Range of Utility Institutional Arrangements

8. Evolution of Urban Water Supply in Africa Patterns of Water Access in African Cities

9. Challenges for BM of WSS Utilities in Africa • Diversity, scale, language • No shared customers.. not real competitors • Little incentives to gather and analyze quality data • Little capacity for analysis • Not always an evidence-based environment

10. Coverage Against Sector Performance in Africa Utilities

11. Twinning has a Mixed Track Record Many launched, few survive and show impact Consult contract not deep partnership Utility may have little say or ownership

12. Main Messages • Performance improvement of utilities is critical to service improvement in developing countries • Performance improvement is a complex and interrelated management challenge: political will, institutional reform and financial viability are important • Benchmarking – especially consistent applied and used innovatively - can stimulate the reform and financing process and be of great use to management: better data, analysis, communications, ownership of actions, and stronger consumer voice can make a difference • Need to incentivize use of benchmarking for it to be effective • Since effect is varied, be strategic in selection of application of benchmarking innovations and link to reform processes for impact