Experiences of metering policy in Malaysia


By Zainuddin Md Ghazali and Zailan Shariff

Following the privatisation, customers’ expectations for better services and reliability of supply became more evident. An increasing demand for water supply was also observed through a substantial increase in customer numbers. As a result the company came under pressure to deliver quality services while also ensuring that the new demands were met.

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Figure 1 – Reading accuracy and reading efficiency trends

Prior to the privatisation, customers had been enjoying water supply with few restrictions and at a low tariff. It was their perception that water must be cheap and all matters pertaining to its supply were the sole responsibility of the agency concerned. Enforcement, however, was very weak, leading to poor implementation of the regulations.

Initially, even the staff had no clear idea of the mission and vision of the company. However, in running a fully privatised water company, drastic changes needed to be made in line with the high expectation of the customer towards service and the company’s goal to achieving its vision and mission. In order to meet these demands and to evolve into a customer friendly entity, the customer service concept and its understanding need to be cascaded down to all levels of employees. The first action by the management was to reorganise the company structure from a decentralised model to a functional, centralised model. Then new strategic goals were set up. This article reviews the metering policy that was adopted to support the strategic plan.


All departments were required to identify their responsibilities and to formulate an action plan and measures of their performance to meet customer expectations. The necessary standards and benchmarking of performance were then established. Some of these are:

  • Specifications and standard procedures
  • Key performance index (KPI)
  • Balanced scorecard (BSC)
  • Customer Charter Quality objectives
  • Skim Akreditasi Makmal Malaysia (SAMM) laboratory accreditation
  • ISO 9001:2000 certification
  • Central laboratory – the first of its kind in Malaysia.

Under the learning and growth programme, training to all levels of staff was emphasised to assist them to better understand the company mission and vision and the objectives of better services to customers.

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Figure 2 – Average collection period

Quality assurance
The Quality Assurance department is responsible for monitoring the company’s performance in complying to ISO 9001:2000, the internal and external auditors’ requirements, the Customer Charter and quality objectives. The department also regulates the specifications for quality standards within the company. The results of this monitoring are compared with the targets and comprehensively reviewed during the management retreat, which is normally held every six months.

Regulatory compliance
The need for perception surveys and their analysis was identified and has been implemented widely to ensure efficiency. Under state legislation the application for water supply for consumers is handled by licensed plumbers registered by the government. SAJH indirectly monitors the performance of the registered plumbers, in order to ensure that they strictly comply with the installation standard set by the company. With this commitment and such a monitoring system between the company and the appointed panel of plumbers has ensured that the quality of the water supply work, especially pertaining to plumbing systems, is well regulated.

Information technology
SAJH is also sensitive towards using effective IT tools to provide operational support. A Geographical Information System (GIS) was introduced in 2001 to register the water supply system, but ensuring utilisation of this tool across the company was a major challenge. To enhance the GIS as a management tool rather than just an asset register, an Integrated GIS system (IGIS) was introduced incorporating elements including customer accounts from the billing information system (BIS), level and flow monitoring from the remote monitoring system (RMS), water sampling test results from the water quality system (WaQIS), asset monitoring from the production control system (PCS), and complaints and pipe bursts/leakages from the job management system (JMS).

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Table 1 – Comparison of new metering policy

Non-revenue water
Setting up a non-revenue water reduction strategy was another important measure in expediting efforts to increase efficiency as well as initiating awareness on the part of customers. Initiatives such as the formation of district metering zones (DMZ), flow balance programme, reservoir cleaning programme, valve and meter service programme, meter testing, meter replacement and meter stand relocation, as well as customer awareness, were introduced noted to support the non-revenue water plan.

SAJH adopted a full metering policy in which all of its customers are metered and the meters are read on a monthly cycle. This policy has impacted positively on the collection efficiency, with an average of 99.8 percent of current bills paid within the next month. However, the company’s cash flow was not the only positive outcome of this policy. Some of the other outcomes experienced by SAJH are:

  • Reduced operating cost by improving meter reading efficiency
  • Provision of up to date billing information to customers
  • Improved level of customer service
  • Improved integrity of customer data
  • Greater control of meter reading operations
  • Reliable, dependable and proven spot billing system.

Planning and controlling the billing accuracy and collection efficiency meet both the customer satisfaction and company cash flow criteria. To control the billing accuracy through meter reading, the supervisor needs to have a strong character and to conduct the reading activities in a professional way.

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Table 2 – Key parameters before and after privatisation

Spot billing through the use of handheld terminals (HHT) was introduced in 2000. Issuing an accurate consumption figure through accurate reading and billing every month helps customers to plan their usage and indirectly to manage their cash flow.

Problems highlighted by the meter readers in their daily reports receive immediate action. Factors that restrict access or reading, such as rain, locked gate, dirty dial, faulty meter, obstructions, vandalism, and water theft are all identified.

Outcomes of the new metering policy in terms of meter reading accuracy and efficiency and the average collection period are shown in Figures 1 and 2.

A comparison of the new metering policy with the previous system, detailing the benefits that have accrued and a comparison of the operational parameters, are presented in Tables 1 and 2.

To ensure that all the issues that arise are not overlooked, they are highlighted for review by management during its operation meetings held twice a month. The actions and resolutions adopted are then conveyed to the middle and lower management for implementation.

Conformance to the quality standards is measured on a monthly, quarterly, half yearly and yearly basis. These quality standards are monitored using KPIs, balanced scorecard targets, quality objectives and Customer Charter index. Examples of the quality and Customer Charter targets are presented in Tables 3 and 4.

This data is reviewed regularly by the management. In order to ensure that corrective and preventive actions have been carried out as required, an internal audit trail and risk management assessment are also conducted periodically.

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Table 3 – Quality objectives

On an annual basis the company undertakes a training needs analysis (TNA) to define staff skills and identify special training needs. Customer service staff have undergone many customer service, development and special purpose training sessions. Special purpose training courses are started with awareness sessions before the detailed training is carried out; examples include total asset management awareness, knowledge management awareness, succession planning, and mentorship.

Specifically in the customer service area, the workshops and training programmes have been arranged prior to competency testing for each level of staff, aimed at indicating the human capital strengths and values. Factors that are considered include:

  • Number of staff/1,000 accounts
  • Number of accounts to be read/meter reader
  • Statistics on the area reading capacity, e.g. whether a squatter area, housing estate, village, industrial area, etc.
  • Average collection period.

To enhance customer relations and to be closer to them, SAJH has opened up avenues for customers to convey their grievances concerning the company. These are:

  • Satellite agencies such as Pasir Gudang, Kulai, Tangkak and Yong Peng
  • Operation centre (available 24/7) and toll-free lines
  • Key customer courtesy visits
  • Public awareness campaign.

Satellite agencies were set up to alleviate the difficulties faced by customers who have to travel a long distance to the SAJH office. Location, objective and focus group are the prime factors considered in ensuring that customers are able to gain front counter access.

Enquiries and complaints from customers are collected and recorded through the JMS at the 24-hour operation centre. Jobs are assigned online to remote maintenance depots as well as via online SMS to the officers in charge for action. The complaints and enquiries are also analysed for further planning and operation improvements. One example from this analysis is that the response time of repairs of pipe bursts has dropped from 24 hours to 18 hours to completion, illustrating the outcome of a continuous commitment to ensure customer satisfaction and job efficiency.

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Table 4 – Customer Charter objectives

A few key customers are assigned to each supervisor to visit to discuss matters pertaining to the service level and water bills. To promote better rapport with customers and to improve customer service by getting direct feedback, SAJH also launched a road show initiative named Mesra Pelanggan. Management leaders are available on-site to have open dialogue with the public and the community. The purpose is to provide awareness and information on water supply and the on-going water supply development programmes that serve the community as a whole. Participants include politicians, government officers, representatives of corporate bodies, community and village leaders, schools heads and other stakeholders. This programme is scheduled to take place at least four times a year.

To get nearer to customers, other initiatives that have been undertaken are visits to schools and higher education institutions. SAJH also interacts with the media through local radio programmes and a column in the local papers providing the latest information on its services. Seminars and conferences have also been organised to solicit feedback on the services provided and issues affecting customers.

The water industry has to be innovative and creative in addressing the challenges of meeting customer needs and providing customer satisfaction.

The needs of internal customers and expectations of external customers must be balanced in line with global standards. Tariffs are critical – while a tariff increase will trigger criticism from customers, it is also an important element to balance customer satisfaction and the operational costs incurred by water operators.

A comprehensive metering policy, including a full metering programme and strict adherence to billing cycles, can prove valuable in supporting a company’s strategic plans. Spot billing can also play a role in enhancing company cash flow and providing bottom line efficiencies.

Supported by the commitment from all levels of staff and the implementation of reliable monitoring systems, it is possible to achieve targets and goals that satisfy both the customers and the water companies.