Stuart Lindsay of Pitcher Partners, Melbourne says benchmarking involves the identification and analysis of best-practice within an organisation and, where possible of external competitors. The application of these insights leads to improved performance and results. Establishing Key Performance Indicators (KPIs) across a range of areas in a business, including financial indicators, service delivery and efficiency as a set of measurable performance standards allows organisations to not only assess individual performance, but to identify areas for growth against competitors.
Lindsay says comparing your business to other operators in the market provides a comparable benchmark. While care must be taken when comparing the performance of a small business to a significantly larger organisation or one with different operating conditions, looking to the achievements of other businesses can provide direction as to where performance can be improved.
How can benchmarking assist your business?
Small businesses incorporating benchmarking as part of their planning process, are more likely to see an increase in sales and profitabiity compared to those who fail to benchmark. The benefits of consciously identifying outstanding methods and procedures can have a clear impact on a business' financial bottom line. Rather than unnecessarily diverting resources, benchmarking can significantly improve a business' effectiveness over a period of time.
Lindsay says industry groups should encourage the use of benchmarking in order to grow efficiency in their industry and stimulate growth. Achieving high performance levels should be the overarching aim of all business opertors, and collaboration can be a way to achieve improvements. This leads not only to increased profits, but higher customer satisfaction and safety across the industry, a win-win situation for both business operators and customers.
We have access to benchmarking data and reports so please contact Helen at our office on 9388 2532 to arrange an appointment.
Source: Pitcher Partners Contact Newsletter Winter 2013