LOGO 1 APPLICATION OF BENCHMARKING FOR URBAN WATER SUPPLY SYSTEM: CASE OF HUE CITY, VIETNAM Student: Nguyen Thi Chau Huyen Committee: Dr. Vilas Nitivattananon (Chairperson) Dr. Edsel E. Sajor Dr. Do Ba Khang May, 2008

2 Contents Literature Review 2 Process of Benchmarking 4 Benchmarking findings 6 Recommendations for improvement 7 Conclusions and Recommendations 8 Introduction 1 3 Methodology Data collection 5

3 1. Introduction - Hue was changed from City Category II to Category I => More population, more development and water demand increase - The city suffers disaster seriously every year => impact to water system - The city lacks infrastructure and integrated management system => affect water main - The water system is developed separately, lacking of continuous improvement => low efficiency and lacking of sustainability - Application of Process Benchmarking, developed in 1980s, is limited in public sector => gap in knowledge - Vietnam have not applied benchmarking => gap in knowledge in the country => Process Benchmarking is applied for Hue city to close the gaps and improve existing situations.

4 Objectives of the study Sub-objectives: - To understand performance measurements used in water supply in Hue city - To develop process benchmarking, considering disaster +gender issues’ influences, encouraging local government and residents participation - To compare existing indicators of the utility’s operation process to other benchmarking partners’ seeking for the best process that the utility can apply - To develop recommendations by adopting best process from benchmarking partners and adjusting the process to be suitable with Hue context To develop environmental process benchmarking for water supply in Hue city => to close the gaps + ensure sustainable development

5 Scope of study Hue city Evaluate efficiency of facility operation and management Give recommendations for improvement rather than develop plan for improvement. Water supply Disaster Solid Waste Gender issues Air Pollution Waste water

6 2. Literature review - -“Benchmarking is a continuous, systematic process for comparing your own efficiency in terms of productivity, quality and practices with those companies and organizations that represent excellent. Benchmarking is also a systematic process which aims at seeking excellence in the world around us in order to learn and adopt its operative content and processes so that we can raise our own organizations to championship class.” (Karlof and Ostbom, 1993) Performance Benchmarking: comparison indicators related to a business as a whole or to the group of critical activities or process. Process benchmarking is selected to apply for Hue. Process benchmarking: comparison of process with a set of sequential activities, explicit comparison of both performance measures and work practices leading to the redesign of a new process.

7 3. Methodology

8 3. Methodology (cons.) Environment Water quality Service Operation process Finance and Efficiency Performance Benchmarking areas (Modified from Larsson et al., 2002)   Areas of process benchmarking

9 4. Process of benchmarking The process of benchmarking in the study includes 5 steps:   Step 1: Decide what to benchmark, covering four areas: Operation process, Environment, Services, Finance and efficiency   Step 2: Identify benchmarking partners: Singapore, Phnom Penh, Vientiane, Ho Chi Minh, Dalat   Step 3: Data collection   Step 4: Data analysis: almost the utility do not include gender issues in their activities   Step 5: Recommendations for improvement The methods of benchmarking are used including:   Performance indicators   Comparison with the Standards   Technology used   Management guidelines   Waste minimization   Professional judgment (Modified from The International Benchmarking Network for Water and Sanitary Utilities)

10 4. Process of benchmarking First meeting to decide what to benchmark Women in suburban areas get more burden because of no water tap Women are impacted directly from polluted rivers

11 4. Process of benchmarking Second meeting with stakeholders to discuss about recommendations Women and gender expert participation in the meeting

12 5. Data analysis - operation process Ho Chi Minh and Singapore are selected to benchmark operation process for Hue. % of test pass the standard of Ho Chi Minh and Singapore are better than Hue, especially in their process. Singapore has good awareness activities

13 5. Data analysis- environment - Wastewater and sludge are discharged directly into the environment. - Hazardous waste and solid waste are stored and disposed together. Urban environmental utility is responsible for collection. Ho Chi Minh is selected to benchmark wastewater and sludge treatment method for Hue city. - Ho Chi Minh is selected to benchmark wastewater and sludge treatment method for Hue city. - Professional judgment is used to benchmark hazardous and solid waste management. - Professional judgment is used to benchmark hazardous and solid waste management.

14 5. Data analysis- services - Customer complaint is 3, but it decrease rapidly from 54 last year to 3 in New customer rate in Hue is lower than other utilities.

15 5. Data analysis- services Professional judgment is used to benchmark PR activities for public awareness improvement and customer satisfaction because there is no specific process from benchmarking partners - -Hue has good performance in public awareness and women involvement - - PR activities have not focus on all residents and women

16 5. Data analysis- Finance and efficiency Ho Chi Minh and Singapore Utilities have the best performance Ho Chi Minh and Singapore are selected to benchmark. Cost/revenue ratio of Hue is higher than Ho Chi Minh and Singapore Chemicals cost and labour cost of Hue is higher than HCM and Singapore

17 5. Data analysis- Process indicators Comparison of process indicators

18 6. Benchmarking Findings   Strengths - -Hue has the lowest water loss in Vietnam - -The water main system is stable in pressure with eleven water factories located in different points of the city - -Water treatment system is improved and automated - -The utility got ISO 9001:2000 for water quality and ISO/IEC 17025: 2005 for laboratory in The utility develops plan to cope with disaster with clear responsibilities for leaders, staff and workers. - - Ensure women rights in Vietnamese Labour Law - -Involve women in planning process

19 6. Benchmarking Findings   Weaknesses - - No water supply in suburban areas => impact to women - - The utility gets raw water from Huong river which has no water source reserve evaluation plan - - Raw water pipe system is controlled together with water supply pipe system - - Gender issues are not considered appropriately - - The process of setting tariffs is conducted by some selected officers - - Separately management in catchments management, sewerage system, drainage system and human health.

20 7. Recommendations for improvement   Recommendation to the utility: 1. Operation process: - Construct storage tank to decrease impact of disaster and balance water source - Separately control raw water pipe and supply main system - Adopt water treatment method of HCM, include chlorine and fluoride in the last step of storage tank - Encouragement public participation via campaign and surveying - - Supply water to suburban areas, ensure access of women and the poor - - Highlight women role in water saving, involve women in decision making - - Widen relationship with experts in universities - - Cooperate with city government in infrastructure construction

21 7. Recommendations for improvement 2. Environment - Use sedimentation method for wastewater - Apply compressing machine for sludge treatment, reuse the sludge - Separate hazardous waste with solid waste, inform the collector about them - - Educate staff in waste minimization. 3. Services - Conduct customer expectation survey in suburban areas - Develop other bill collection systems: collecting via bank transfer, collecting each two months or six months, collecting at the same time with meter reading - Widen public awareness campaign to all residents, especially women

22 7. Recommendations for improvement 4. Finance and efficiency: - Attract private participation in some activities for more capacity - Improve supply capacity in order to satisfy human demand in suburban areas => unit water cost will decrease - Develop more tariffs, subsidize for the poor, women and suburban areas - - Reform the utility from State owned to privatization for more efficiency.

23 7. Recommendations for improvement   Recommendations to city government: - - Widen foreign relationship, having project with other city to exchange experience in environmental management. - - Improve drainage, sewerage and wastewater treatment system. - - Increase efficiency in planning process, change into bottom-up planning. - - Highlight disaster management: drainage dredging, construct dam and reservoir, planting trees, management the areas along the river, etc.

24 8. Conclusions – Contribution of the study From studying existing situation of the utility, the study has achieved: - - Process benchmarking is applied with five steps without recommendations implementation => No model and evaluation - - Recommendations for improvement are developed for the utility and city government - - Gaps in knowledge and gaps of performance benchmarking are filled - - The study raise women role, inform the managers about other factors’ influences to the sustainability of the water system and city development - - The study has combined specific areas and sub-processes and adjusted the process according to public sector and existing context of Hue city

25 8. Recommendations   Utilization of study result: - - City government commitment is necessary in include recommendations in the planning process - - Different department should coordinate together in integrated infrastructure planning and implementation - - The utility can consider and apply recommendations in the operation activities for improvement - - Process benchmarking can be applied for other cities, Hue is a benchmarking partner.

26 8. Recommendations   Further studies: - Developing detail plan for improvement for the utility - - Develop benchmarking model pilot test, model modification and finalization - - Study on application process benchmarking for other cities - - Study on application process benchmarking for wastewater, solid waste, etc. - - Study on application of integrated benchmarking and governance in public sector.

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28 Pictures of site visit

29 Pictures of site visit

30 Specific Methodology   Data collection - - Indicators about operation process, environment, service, finance and efficiency, and gender issues are developed - - Quantitative data is used to compare utility’s efficiency - - Process data is used to benchmark for Hue utility - - Data collection always involve women in meetings, workshop, face- to-face interview in appropriate time - -Data analysis - All factors of data related to financial management, water quality, system operation, service quality, system management, gender issues… will be analyzed together with system efficiency etc. - Gender analysis focus on main issues: Women vulnerability, women and men needs, accessibility to the water supply and services, ability to make change, etc.

31 Decide benchmarking partners Table 5.2 Analysis of criteria meeting Singapore, Phnom Penh, Vientiane, Ho Chi Minh and Dalat Utilities are selected