| The first step of performance management and assessment is to establish a suitable and international performance indicators system (PIs) for water supply service in China. It is important that PIs are widely used as a necessary tool to enhance water industry efficiency, development and privatization reform. It is not only used for performance assessment, but also for monitoring and guiding the development of water industry. It also is a necessary tool for water utility investors, operators and regulatory authorities to manage water supply industry.The difficulties of performance indicators system research for water industry of the China is the establishment of performance indicator (PI), as water treatment technology, water company geographical conditions and management level are different in China. So it's hard to find a unite standard to measure and compare the market's performance.In the view of the difficulties and problems, the PIs was established in this study, by reviewing and investagating the most popular international PIs, analyzing the frequency of every PI and using Delphi and Statistic method. The PIs of China maintain a comprehensive, balanced and representative, and have many sdvantages such as practical and international consistency. On the other hand, the data used for PIs were researched in order to enhance the vevacity of informantion, such as the definition of data reliability and accuracy, the way of data collection and checking method. At last, the weight of each PI and evalution factors were identified by using Analytic hierarchy process (AHP) and Delphi method. The result of this paper is helpful to performance assessment and comparation among the water supply industries in China.
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