EAP - The Pacific Infrastructure Challenge - World Bank (2006).pdf

Some of these reforms have already been tried in the Pacific, with mixed success. We
discuss each reform below, highlighting past successes or failures, and attempt to
identify the criteria for success. Below, we examine the full suite of policies which, if
consistently implemented, would result in:
Improved rural infrastructure access
More efficient service provision, and
Appropriate pricing.
7.2.1 Benchmarking
Benchmarking infrastructure performance will help to identify whether reforms are
actually necessary, and if so, in what areas.
Although this sounds straightforward, governments often embark on programs that
include a ‘checklist’ of sector reforms, without stopping to consider whether each
specific component is actually necessary. Benchmarking helps to avoid a ‘cookie
cutter’ sector reform strategy, which may be unsuited to the specific issues a country
faces.
Benchmarking involves measuring a company or utility’s performance against key
performance indicators. IBNET 16 , (a benchmarking ‘start-up kit’, funded by DfID
and managed by the World Bank), defines two forms of benchmarking:
Metric benchmarking: Quantitative measurement of performance against
other organizations over time. Metric benchmarking provides utilities with
information on performance gaps. However, it does not always provide an
indication of explanatory factors, such as geography, weather or social
customs that impact performance
Process benchmarking: The analysis of a utility’s own business processes and
comparison with those of organizations with exemplary performance in
those processes. Process benchmarking recognizes that the best
performance for one utility may not be equal to the best performance of
peer utilities, given a unique set of explanatory factors. It involves
measuring the best performance that can be achieved under the particular
constraints and circumstances that exist for a specific utility. This includes
tracking the utility’s own performance over time to identify trends and
improvements.
Regional benchmarking has already been initiated in the Pacific in the electricity and
water sectors. Electricity utility performance is benchmarked annually, and WSS
utilities are benchmarked every few years.
These programs have faced some challenges:
Many utilities lack the human resources capacity to undertake the required
data gathering, even on an annual basis
Utilities do not adopt a common approach to measuring performance for
each indicator; therefore comparisons are not always accurate.
Currently the benchmarking analysis and results are produced by the Pacific Power
Association (PPA) and Pacific Water Association (PWA). The regional nature of
these benchmarking initiatives does help to alleviate the capacity and capability
constraints. The PPA is also helping to train utility staff on measuring performance
to achieve more consistent results.
16 www.ib-net.org
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