Benchmarking helps you measure "apples with apples" to see what your business really needs.
We all want to improve our business performance. We all set goals and targets to achieve this. But, how do we know if our targets are reasonable and achievable or just “guesstimates”; whether our 10%target improvement should realistically be only 5% or could be 30%?
- How do we perform against our competitors?
- How do our clients really see us and our service against other offerings?
- Are we offering the best price-to-value solutions?
- What could we be doing better and how?
- What do other industries do in similar circumstances?
- Do we have any sustainable competitive advantages?
These vital questions for long-term business success - even survival are answered and addressed through the process of benchmarking.
Striving for best practice is like running in a race without a finish line"
Benchmarking should be undertaken regularly to compare our performance against best-in-class practices, determine how other companies achieve their performance levels and use this information to improve our own performance. Most importantly, benchmarking must be integral with your business strategy - not just an add-on. If it is not, then the results will be meaningless to your management, workers and customers.
"You must learn from the mistakes of others. You can't possibly libe long enough to make them all yourself."
Even with benchmarking, drawing the wrong conclusions can lead us down the wrong commercial path with potentially catastrophic results for our business.
So what are the important questions to ask and when we have asked them and have the answers, what changes should we make for optimum effect?
Obtaining the right information from the right sources and deriving the right conclusions for your business requires a benchmarking strategy formulated with sound knowledge of your business and the industry you work in.
"There is nothing so useless as doing efficiently that which should not be done at all."