Anang Muftiadi Department of Business Administration, Faculty of Social and Political Sciences, Universitas Padjadjaran, Indonesia.
Email: anang.muftiadi@unpad.ac.id
Yoga Putut Afandi Bandung Institute of Technology, Indonesia.
Email: yogapututa@gmail.com
Anang Muchlis Ministry of Public Works and Public Housing, Indonesia
Email: anangmuchlis@pu.go.id
Quyen Minh Pham Thu Dau Mot University, Viet Nam
Email: quyenpm@tdmu.edu.vn
Valendya Rilansari Sumatera Institute of Technology, Indonesia
Email: valendyarilansari@gmail.com

Abstract:

The market share of clean water companies in Indonesia (PDAMs) are very small compared to the demand growth as well as threat of scarcity of clean water occur. The clean water companies market share is around 28.85%. Many of companies are not able to provide drinking water services that meet the standards, as clean water companies in Indonesia are still inefficient Therefore, fundamental solutions are needed to increase efficiency. This research aims to develop a comprehensive model of efficiency measurement of clean water companies in Indonesia and develop it’s generic strategy to reduce inefficiency, based on two models by using multiple regression techniques with data from 398 companies. Model-1 categorises the efficiency level of the company using standard and frontier equations based on cost curve, and Model-2 uses factors that determine cost efficiency based on four clusters of scale production. The results of the look at display that many organizations are inefficient due to the have an impact on of manufacturing scale and different affecting elements in every cluster, mainly administrative elements, trendy expenses and water loss/ leakages. This is a essential hassle because easy water production is capital in depth with standardised generation. For practical tips, companies need to boom production manufacturing through growing new potential or thru mergers & acquisitions among small size organizations. To support the strategy, each employer additionally desires to solve its own micro-partial problems. For government and groups affiliation, it's miles recommended a coverage to cope with many elements to growth efficiency, which includes variations in the production scale and the big number of inefficient companies. The health of the operational system requires careful management when implementing institutional reforms which emphasize increased governmental responsibility. The strategic focus on these sectors enables smooth water companies to boost operational efficiency apart from self-performance improvement. additionally make a contribution to the critical intention of making sure sustainable get admission to to smooth water for all of Indonesia.

Keywords:Business Governance, Clean Water, PDAMs, Efficiency, Frontier’s Efficiency.