The Productivity Initiative is a 10-year program launched by the King County Wastewater Treatment Division to make sure that ratepayers are getting the best return for their investment in wastewater treatment services.

Balanced Scorecard

• Overview
• How ratings are applied to measurements
• 2010 summary of overall results

Overview

WTD uses a Balanced Scorecard (BSC), a performance measurement tool often used in private business, to measure its overall performance. Balanced scorecards were developed in the 1990s as tools for businesses and organizations to evaluate performance, beyond just financial measurements, by providing performance feedback from multiple perspectives. WTD uses the scorecard as a management tool – to monitor how well the programs and strategies developed as part of the Productivity Initiative are working. The scorecard ensures that pilot program decisions take into account different perspectives, including financial performance, business practices, customer focus, and employee management. These four areas of performance are measured by four corresponding quadrants of the scorecard.

In 2001, WTD management identified performance indicators in each of the four quadrants and began collecting data so that year-to-year comparisons could be made during the 10 years of the pilot program. The targets are set to be very aggressive and comparable to results reflecting the performance of the best wastewater programs in the nation.

A performance measurement system such as this allows a public utility to align its service levels with operational and financial performance. With it, a utility can get feedback needed to guide planning efforts. The four quadrants and their key measures are shown and described on the following pages.

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How ratings are applied to measurements

A green rating is achieved when the performance-to-target ratio is equal to or greater than 100 percent; a measure is rated yellow when the performance-to-target ratio is 90-99 percent; and a measure receives a color rating of red when its performance-to-target ratio is less than 90 percent. However, any performance for environmentally critical measures that falls below 100 percent of target will receive a color rating of red.

• ‘Green’ indicates that the target was satisfactorily met. A green rating is only achieved when performance is at 100 percent of the target.
• ‘Yellow’ indicates performance was within 90-99 percent of established target. For environmentally-critical measures, such as NPDES compliance, there is no yellow rating. For those measures, a rating of red is given for any performance falling below target.
• ‘Red’ means performance has fallen below 90 percent of established target. For critical measures in which performance must be maintained at or above 100 percent, red indicates failing to meet 100 percent of target. However, any performance for environmentally critical measures that falls below 100 percent of target will receive a color rating of red.

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2010 Summary of Overall Results

In 2010, all four quadrants of the Balanced Scorecard were rated yellow. There were several measures in each quadrant with green ratings; however in order for the entire quadrant to be rated green all measures in the quadrant must meet their established targets. Summaries of performance results in each quadrant are provided on the following pages.

Financial Performance Results

The Financial Performance quadrant of the BSC includes measures that indicate the overall financial health of WTD and the efficiency with which the division provides services to its customers and stakeholders.

The Financial Performance quadrant was rated yellow overall. In 2010, preliminary results show that the wastewater program will meet its targets for four of six financial measures, including the annual productivity operating expenditures, debt service coverage ratio, sewer rate comparisons to other agencies and accomplishment rate for capital expenditures. WTD did not meet the efficiency measure (the cost per pound of pollutants removed in the wastewater treatment process). WTD calculates a target rate based on inflation using a ten-year rolling cycle. The actual rate for 2010 was more than 10 percent higher than the target rate, resulting in a rating of red for that measure.

Business Practices Results

The Business Practices quadrant of the BSC includes four categories of measures that are key to WTD’s business practices: permit compliance, operational performance, resource recovery, and effluent non-degradation. Included in these categories are measures of WTD’s compliance with its NPDES and other permits, its stewardship of public health and water quality (in terms of keeping down sewer overflows and conducting sediment cleanups), resource reclamation efforts, and maintaining high standards for the quality of treated wastewater effluent.

Business Practices was rated yellow overall. In 2010 WTD achieved 99.9 percent compliance with National Pollutant Discharge Elimination System (NPDES) permits for effluent quality, 99.4 percent compliance with reclaimed water permits, and 94.5 percent compliance on its air quality. The division had one notice of violation for a spill in its conveyance system and did not meet the target for number of avoidable sanitary sewer overflows in a year. There were no Construction Stormwater Permit Notice Violations in 2010.

WTD performed better than the target for environmental quality of treated wastewater effluent. WTD also met or exceeded targets for two of its resource recovery measures; biosolids recycling and reclaimed water volumes. The measure for recovery and reuse of biogas did not meet targets and was rated red. This is due to removing cogeneration equipment that had exceeded its useful operating life from the West Point Treatment Plant. A project is currently under construction to replace the equipment by 2012, which will bring biogas utilization rates back up to target. WTD met and exceeded the energy conservation measure, achieving more than 2 percent energy conservation (normalized from 2007).

Customer Focus Results

The Customer Focus quadrant of the BSC includes measures that look at how component agencies view the quality and value of their contract services with WTD. This quadrant also looks at how neighbors to WTD facilities, both residential and business, view WTD as a neighbor. A contract customer survey is sent out annually to customers and a “Near Neighbor Survey” is administered every other year. Questions in the contract customer surveys are rated on a scale of 1-5, with 1 being poor and 5 being excellent. The target established for these measures is 4, a rating of very good. The results of the Near Neighbor Survey are calculated as a percentage of neighbors and businesses who view the West Point and South Treatment Plants as good neighbors. The target established for this measure is 75 percent.

The Customer Focus quadrant maintained a yellow overall rating and saw only very minor decreases in specific measures. Local agency satisfaction with the Metropolitan Water Pollution Abatement Advisory Committee (MWPAAC) process dipped slightly from 3.94 in 2009 to 3.92 in 2010. The customer satisfaction rating slid from 3.92 in 2009 to 3.73 in 2010. The local agency satisfaction with contract services was steady at 3.63. The overall response rate to the annual customer feedback did not change – meeting the 50 percent goal.

Employee Management Results

The Employee Management quadrant of the BSC includes measures tied to results from an employee survey conducted every other year. Measures from the survey include overall satisfaction with jobs and employee ratings of respectfulness in the workplace and employee satisfaction with workplace safety.

The Employee Management quadrant also includes measures for the employee retention rate, percentage of employees with professional certifications or licenses, and a safety measure that looks at the percentage of employees with time-loss injuries that are able to return to transitional duty or regular duty within three days of medical release.

The Employee Management quadrant was rated yellow. Employee retention and rate of transfer of employees with time-loss injuries to transitional duty assignments were rated green in 2010. The percentage of employees with professional licenses and certifications dropped from green to yellow in 2010. Employee satisfaction with workplace safety, job and a respectful workplace were all rated yellow.

Follow-up on Results

WTD takes ratings of yellow seriously, and while the standards for achieving a green rating are very ambitious, we are committed to achieving green ratings by:

• Examining all operating costs. (For example: Reducing the use of polymer through more-efficient dosing).
• Initiating additional training, accountability measures and capital projects to eliminate any compliance issues.
• Continuing to work closely with our component agencies to address any concerns they may have.
• Following through on any and all areas identified as less-than-satisfactory in the employee survey.

View the entire 2010 Annual Report and 2010 Scoreboard Summary.

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