What is benchmarking? An article in Personnel Today
, the second of two, sheds some light on this, while acknowledging that there are numerous definitions. The author, Ray Wilkinson, director of The Best Practice Club, says, " It is widely accepted that benchmarking can be formal or informal in nature, and focused on either performance or best practice."
He goes on to explain the difference between these two broad types of benchmarking:
"Performance benchmarking is the comparative analysis of key performance indicators, while best practice benchmarking requires understanding of a best or superior practice in order to adapt it for your own organisation. The former can be carried out at a distance from your benchmarking partners as what is required is a reference group against which your performance is judged. The latter has to be done "up close and personal" as the level of understanding you need to gain of best practice can only be achieved by engaging directly with a benchmarking partner."
Wilkinson also provides a useful check list of "Top tips to ensure a successful benchmarking exercise":
- Take care to select the process to benchmark that will give you the best return.
- Put in place the right amount of skilled resources taking care not to over or under resource the project.
- Plan the benchmarking project thoroughly and adopt a formal project management process to maximise your chances of success.
- Train your benchmarking team properly so that they adhere to an accepted benchmarking code of conduct, eg the European Code developed by the Benchmarking Institute.
- Research and engage benchmarking partners from the widest possible sources.
- Collect, exchange and store data adhering to the benchmarking code of conduct you have adopted.
- When analysing performance gaps do so objectively and do not be tempted to defend and justify your current performance.
- Make sure you adapt the best/superior practice you identify so that it can be implemented within your organisation.
- When you implement the new process use change management principles to introduce it effectively.
- Review the results you achieve and take any remedial actions required.
- Do not be embarrassed about celebrating your success.
The article also looks at how benchmarking can help an organisation to improve and what is the best way to learn from benchmarking, including who you should benchmark with.
Among the useful advice in Wilkinson's argument are a set of key questions to ask before you embark on benchmarking.
The article is the fifth in a series on using data and statistics more effectively in HR:
XpertHR offers an online benchmarking service
covering pay and benefits, absence and leave, recruitment, training, equality, employee relations and work organisation.