Collaborative Benchmarking, Transparency and Performance:

¶ … Collaborative benchmarking, transparency and performance: Evidence from the Netherlands water supply industry" by Okke Braadbaart investigates and explores the benchmarking efforts of The Netherlands water industry. These benchmarking efforts, Braadbaart asserts, represent a case of collaborative benchmarking in the public sector, and as such, Braadbaart's aim is to "address contesting claims regarding benchmarking effects espoused by the managed competition and collaborative benchmarking literatures" (p. 690).

In the beginning of the 1990s, numerous Dutch water utilities made forays into collaborative benchmarking efforts, but they were confidential. In 1997, the entire Dutch water industry conducted its first all-industry benchmarking effort. Its results were not confidential -- they were openly shared and published. There was a repetition of this effort in 2000. By exploring and investigating the consequences of these collaborative benchmarking programs regarding both transparency and economic performance, Braadbaart's study formulates four hypotheses.

Braadbaart's first hypothesis (H1) is that the Dutch benchmarking exercises would increase transparency, and indeed they did. The information from the benchmarking efforts reached individuals and positions across the board -- from utility managers to governing committees to the public at large. Not only did the benchmarking initiatives increase transparency, but the data generated from them "put boards of governors in a better position to judge the performance of utility managers and enabled customers to judge the effectiveness of their water services providers" (p. 690).

Braadbaart's second hypothesis (H2) is that the benchmarking initiative alone would not affect the organization's performance and efficiency until the results of the benchmarking efforts were published, shared, and made available to the public. This was confirmed by the study. As such, the performance of the water utilities that participated in the confidential benchmarking efforts of the early 1990s did not eventually or gradually outperform those that had not engaged in benchmarking exercises. An increase in performance and delivery of quality services was noticed only after the benchmarking efforts and results were made available to the public in the 1997 industry-wide benchmarking initiative.

The third hypothesis of Braadbaart's benchmarking study (H3) was that the benchmarking exercises would enhance the utilities' economic performance, but only after the benchmarking results were publicized, shared, and made available to the public. Braadbaart's study confirmed this hypothesis as well. Why might the utilities' economic performance show improvement only after the industry-wide study in public benchmarking that occurred in 1997? It is possible that utility managers at these organizations were not yet accustomed to benchmarking measures and as such could not employ their lessons effectively. Another explanation for the time lag in benchmarking improving performance is that the utility managers only became serious about reform and enhancing performance after the benchmarking information was made available to the public at large.