Drivers for performance improvement originating from the Dutch drinking water benchmark

Abstract

The Dutch drinking water sector has been benchmarked every 3 years since 1997, and the sector has significantly improved performance since then.Based on interviews withCEOs and financial managers of drinkingwater companies five drivers for improvement as a result of this benchmark are identified: 'learning effect', 'enhanced transparency', 'managed competition', 'avoidance of negative consequences' and 'personal honour of director'. Different developments have caused stagnation of further improvement: The variation on the benchmarked performance indicators has decreased, participation in the benchmark became mandatory for all Dutch drinking water supply organizations, it lacks a focus on the future, and participating organizations experience high financial pressure. These developments decrease the influence of the drivers. Four possible new impulses for the benchmark are identified and their influence on the effect of the drivers is analysed. The two most promising new impulses are tomake the benchmark adaptive and to involve consumers in the process of benchmarking, both have a positive influence on the effect of almost all drivers. This study contributes to the understanding of how benchmarking leads to improvement and to the analysis of the impact of design choices, leading to well-founded decisions for re-design of the Dutch drinking water benchmark.