Download Financial and Operational Performance

Financial and Operational Performance
Improvement Programe (FOPIP)
Danube Water Conference 2017, Vienna, May 18
Training session on Local governments’ role in planning
investments and improving performance of WSS services
Trainers: Mr. Jane Vrteski, ADKOM, Macedonia and
Ms. Aida Jusufhodzic, AQUASAN, B&H
Learning objectives
Session’s learning objectives:
• To familiarize with the purpose, concept and methodology of the
Financial and Operational Performance Improvement
Programme (FOPIP).
• To be able to prioritize the Management Areas, those are in need
of improvement.
• To familiarize with the development of the Improvement plan for
prioritized management areas.
The need for FOPIP
• Inadequate HRM
• Low operational efficiency
 rising costs;
 high level on NRW;
 unreliable and low level of service.
 low productivity;
 staff performance not
evaluated;
 insufficient internal
communication.
• Tariffs below cost-recovery:
 insufficient revenues;
 poor maintenance;
 under-investment in infrastructure.
• Inadequate customer relations
 unsatisfied customers;
 unpaid bills;
 tools for customer relations
not used.
Why FOPIP?
• It is a systematic approach for achieving effective utility
management that can help PUCs improve their services,
increase community support, and ensure a strong and
viable utility long into the future.
• It is often required by international financial institutions,
to improve a utility’s performance, and capacity to sustain
that performance, prior to becoming eligable for
international funding.
Key Management Areas of improvement
Business
planning and
budgeting
Water
resource
adequacy
Product
quality
Financial
management
Mapping and
measurements
Effective Utility
Management
Nonrevenue
water
Tariff policy
Infrastructure
stability
Organistion
and
employees
Customer
relations
Conducting assessment and developing Action
plan 1
• Assessment of current situation regarding the institutional,
financial and operational performance, identify the
problems and their causes;
• Prioritisation of key areas of improvement according to
importance of each area to the Utility.
• Develop an overall and prioritized Utility Improvement Plan.
Conducting assessment and developing Action
plan 2
• Definition of real and measurable objectives;
• Proposal of activities/measures;
• Allocation of responsibilities for the proposed activities;
• Defining a time-frame for the actions;
• Assessment of the necessary lines of communication;
• Assessment of the optimal ways to measure and analyse
progress made (selection of key performance indicators).
Benefits of FOPIP
• It can educate utility staff and stakeholders regarding the
range of responsibilities faced by Utility managers.
• It can provide an additional framework for Utility’s longterm planning efforts.
“Plan-Do-Check-Act” methodology of
FOPIP
Interactive training exercise
Self-assessment for PUCs
• Assessing the current level of achievement for each
management area of Public Utility Company
• Tool: Self-assessment sheet for PUCs
Step 1 - Rating Areas
1.
Water resource adequacy and product quality
(e.g. clean & safe water)
Performance score 15
a. The system is able to meet the water needs of its customers now and for the reasonable future (in terms
of quantities for customers).
1☐2☐3☒
b. The utility or community has performed a long-term water supply and demand analysis.
1☒2☐3☐
c. The utility regularly monitors water quality, in accordance with regulatory requirements.
1☐2☐3☒
d. The system is in compliance with regulatory requirements related to water quality.
1☐2☐3☒
e. The system is in compliance with service reliability requirements (24 hours service).
1☐2☐3☒
f. Rural water systems are under management and control of PUC.
1☐2☒3☐
Performance score:Summarize the score for each management area
and look at the table below to see the overall performance score for
PUC – low, medium and high.
No.
Management area
Low
Medium
High
1
Water resource adequacy and product quality
1-6
7-12
13-18
2
Network mapping and measurements
1-9
10-18
19-27
3
Non-revenue water
1-6
7-12
13-18
4
Infrastructure stability
1-4
5-8
9-12
5
Customer relations
1-8
9-16
17-24
6
Organisation and employees
1-9
10-18
19-27
7
Tariff policy
1-5
6-10
11-15
8
Financial management
1-3
4-6
7-9
9
Business planning and budgeting
1-5
6-10
11-15
Performance score
No.
1
Key
Management
Area
Water resource
adequacy and
product quality
Management Area Description
a.
b.
c.
d.
e.
f.
2
Network
mapping and
measurements
a.
b.
c.
d.
e.
f.
g.
h.
The system is able to meet the water needs of its customers
now and for the reasonable future (in terms of quantities for
customers).
The utility or community has performed a long-term water supply
and demand analysis.
The utility regularly monitors water quality.
The system is in compliance with regulatory requirements
related to water quality.
The system is in compliance with service reliability requirements
(24 hours service).
Rural water systems are under management and control of
PUC.
The utility has electronic maps of primary water network
developed.
The utility has electronic maps of secondary water network
developed.
The utility has electronic maps of sewage network developed.
The utility has human capacities for mapping and GIS.
Water meters on all water connections established.
Water meters are regularly maintained and replaced.
Flow meters on water intake established.
The utility understands, has documented, and monitors key
operational aspects of the system (e.g., pressure, flow).
Performance
score
(Low Medium High)
H
M
Rank priority
(Low –
Medium High)
Step 2 - Ranking Areas
No.
1
Key
Management
Area
Water resource
adequacy and
product quality
Management Area Description
a.
b.
c.
d.
e.
f.
2
Network
mapping and
measurements
a.
b.
c.
d.
e.
f.
g.
h.
The system is able to meet the water needs of its customers
now and for the reasonable future (in terms of quantities for
customers).
The utility or community has performed a long-term water supply
and demand analysis.
The utility regularly monitors water quality.
The system is in compliance with regulatory requirements
related to water quality.
The system is in compliance with service reliability requirements
(24 hours service).
Rural water systems are under management and control of
PUC.
The utility has electronic maps of primary water network
developed.
The utility has electronic maps of secondary water network
developed.
The utility has electronic maps of sewage network developed.
The utility has human capacities for mapping and GIS.
Water meters on all water connections established.
Water meters are regularly maintained and replaced.
Flow meters on water intake established.
The utility understands, has documented, and monitors key
operational aspects of the system (e.g., pressure, flow).
Performance
score
(Low Medium High)
Rank priority
(Low –
Medium High)
H
H
M
H
Performance score
Step 3 - Match Results
High
1
Medium
2
Low
Low
Medium
Ranking
(Priority)
High
Step 3 - Match Results
Step 4 - Management Area Improvement Plan
List your top three Priority Management Areas – these should be drawn from the selfassessment activity.
List the Improvement Actions that you will undertake to address the priority
management areas – you should have at least one action for each priority management
area (actions may address multiple management areas).
Priority Management Areas:
Improvement Actions
1. Network mapping and measurements
1. To develop electronic maps of
secondary water network
2.
2.
3.
3.
Step 4 - Management Area Improvement
Plan
Improvement Action: To develop electronic maps of secondary water network
Description:
To develop electronic maps of secondary water network…

Action
Network mapping and measurements

Management Area(s) addressed
 Objective(s)
Timeline:

Start date

Milestones
 Target completion date
Responsible Party (or Parties):
Relevant Resources (on-hand or needed):
Challenges to Address:
Review Process:

Performance indicators or measures

Status reports and updates frequency/cycle
Other Notes:
Thanks a lot for your attention!