Knowledge and capacity development (KCD) is increasingly acknowledged as critical for water supply development. Since KCD aims to improve institutional performance, it is often measured using technical performance targets. This paper cautions about the misleading nature of this measurement. The authors argue that technical performance improvement should be separated from competence development because the latter does not always directly translate into the former in a short time period. Drawing on empirical evidence about the management contract between Aqua Vitens Rand Limited and Ghana Water Company Limited, the paper demonstrates how the process of integrating and using competences is a necessary condition before KCD interventions can result in performance improvement. As this process often takes time, KCD providers and beneficiaries should set realistic performance targets. Not doing so creates unrealistic expectations and often leads to underestimation of the actual impact. This paper finds that knowledge management concepts common in the private sector are equally applicable in the public sector but that the latter may be constrained by short term goals and lack of insight in management processes. It is concluded that technical performance-based assessments should be complemented by capacity-based assessments in order to show fairly the contribution of KCD interventions.

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