Malaysian water utilities performance with the presence of undesirable output: A directional distance function approach

Norbaizura Kamarudin, Wan Rosmanira Ismail, Noor Asiah Ramli

Research output: Contribution to journalArticle

4 Citations (Scopus)

Abstract

Non-Revenue Water (NRW) is water losses in the distribution process and it affects water supply management worldwide. Malaysia is not excluded and the authority has put a high priority on NRW as it affects the revenue collection. Consequently, NRW is established as one of the Key Performance Indicators (KPIs) to assess the efficiency of Malaysia water supply industry. However, the current policy is impractical; the assessment of all the water utilities is against a single NRW target. Moreover, NRW should be considered as an undesirable product in the water supply system. Therefore, an alternative to Data Envelopment Analysis (DEA)-based approach called Directional Distance Function (DDF) is applied to measure the performance of the integrated production of desirable and undesirable outputs. The result shows that the measurement of water technical efficiency is more explicit using DDF model, where the potential reduced level of NRW for each inefficient water utility can be determined in order to improve their performance. This is in line with the government’s aim to reduce the NRW level countrywide.

Original languageEnglish
Pages (from-to)17-22
Number of pages6
JournalJurnal Teknologi
Volume78
Issue number4-3
DOIs
Publication statusPublished - 2016

Fingerprint

Water
Water supply
Water supply systems
Data envelopment analysis
Water levels
Industry

Keywords

  • DDF model
  • DEA model
  • NRW
  • Undesirable outputs

ASJC Scopus subject areas

  • Engineering(all)

Cite this

Malaysian water utilities performance with the presence of undesirable output : A directional distance function approach. / Kamarudin, Norbaizura; Ismail, Wan Rosmanira; Ramli, Noor Asiah.

In: Jurnal Teknologi, Vol. 78, No. 4-3, 2016, p. 17-22.

Research output: Contribution to journalArticle

@article{e21b460c22d74e1f8a76fbc036e76521,
title = "Malaysian water utilities performance with the presence of undesirable output: A directional distance function approach",
abstract = "Non-Revenue Water (NRW) is water losses in the distribution process and it affects water supply management worldwide. Malaysia is not excluded and the authority has put a high priority on NRW as it affects the revenue collection. Consequently, NRW is established as one of the Key Performance Indicators (KPIs) to assess the efficiency of Malaysia water supply industry. However, the current policy is impractical; the assessment of all the water utilities is against a single NRW target. Moreover, NRW should be considered as an undesirable product in the water supply system. Therefore, an alternative to Data Envelopment Analysis (DEA)-based approach called Directional Distance Function (DDF) is applied to measure the performance of the integrated production of desirable and undesirable outputs. The result shows that the measurement of water technical efficiency is more explicit using DDF model, where the potential reduced level of NRW for each inefficient water utility can be determined in order to improve their performance. This is in line with the government’s aim to reduce the NRW level countrywide.",
keywords = "DDF model, DEA model, NRW, Undesirable outputs",
author = "Norbaizura Kamarudin and Ismail, {Wan Rosmanira} and Ramli, {Noor Asiah}",
year = "2016",
doi = "10.11113/jt.v78.8232",
language = "English",
volume = "78",
pages = "17--22",
journal = "Jurnal Teknologi",
issn = "0127-9696",
publisher = "Penerbit Universiti Teknologi Malaysia",
number = "4-3",

}

TY - JOUR

T1 - Malaysian water utilities performance with the presence of undesirable output

T2 - A directional distance function approach

AU - Kamarudin, Norbaizura

AU - Ismail, Wan Rosmanira

AU - Ramli, Noor Asiah

PY - 2016

Y1 - 2016

N2 - Non-Revenue Water (NRW) is water losses in the distribution process and it affects water supply management worldwide. Malaysia is not excluded and the authority has put a high priority on NRW as it affects the revenue collection. Consequently, NRW is established as one of the Key Performance Indicators (KPIs) to assess the efficiency of Malaysia water supply industry. However, the current policy is impractical; the assessment of all the water utilities is against a single NRW target. Moreover, NRW should be considered as an undesirable product in the water supply system. Therefore, an alternative to Data Envelopment Analysis (DEA)-based approach called Directional Distance Function (DDF) is applied to measure the performance of the integrated production of desirable and undesirable outputs. The result shows that the measurement of water technical efficiency is more explicit using DDF model, where the potential reduced level of NRW for each inefficient water utility can be determined in order to improve their performance. This is in line with the government’s aim to reduce the NRW level countrywide.

AB - Non-Revenue Water (NRW) is water losses in the distribution process and it affects water supply management worldwide. Malaysia is not excluded and the authority has put a high priority on NRW as it affects the revenue collection. Consequently, NRW is established as one of the Key Performance Indicators (KPIs) to assess the efficiency of Malaysia water supply industry. However, the current policy is impractical; the assessment of all the water utilities is against a single NRW target. Moreover, NRW should be considered as an undesirable product in the water supply system. Therefore, an alternative to Data Envelopment Analysis (DEA)-based approach called Directional Distance Function (DDF) is applied to measure the performance of the integrated production of desirable and undesirable outputs. The result shows that the measurement of water technical efficiency is more explicit using DDF model, where the potential reduced level of NRW for each inefficient water utility can be determined in order to improve their performance. This is in line with the government’s aim to reduce the NRW level countrywide.

KW - DDF model

KW - DEA model

KW - NRW

KW - Undesirable outputs

UR - http://www.scopus.com/inward/record.url?scp=84964031520&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84964031520&partnerID=8YFLogxK

U2 - 10.11113/jt.v78.8232

DO - 10.11113/jt.v78.8232

M3 - Article

AN - SCOPUS:84964031520

VL - 78

SP - 17

EP - 22

JO - Jurnal Teknologi

JF - Jurnal Teknologi

SN - 0127-9696

IS - 4-3

ER -