The APQC Blog

The Many Reasons to Benchmark 

The Many Reasons to Benchmark 

A surveyor's mark cut in a wall, pillar, or building and used as a reference point in measuring altitudes. A standard or point of reference against which things may be compared or assessed. 
What am I talking about? A benchmark, of course. The later definition is where we will focus our attention.  

In the corporate world, benchmarking is the practice of comparing business processes and performance metrics to industry leaders and leading practices from other companies.  
Why do companies benchmark?  
Benchmarking helps organizations improve by giving them the information they need to effectively identify breakthrough levels of performance and the business processes which drive them. The why part of benchmarking is easy to understand - every organization wants to improve.  
Who to benchmark is not as easy to determine – the easy answer is to identify organizations in the same industry. Why not, they perform the same or similar operations, so let’s see if they do it the same way we do and if they don’t, is their way better. Plus, it makes for easy comparisons. Makes sense, right?  Yes, but don’t forget the reason why organizations benchmark, to improve. They want to learn a better, faster, smarter way to work, so finding other organizations that are doing the same thing isn’t providing value. They need “fresh eyes.”  
In a recent benchmarking study, the sponsor organization was skeptical when seemingly unrelated organizations were suggested as study partners. What can we learn from them? They don’t do anything remotely related to what we do. Exactly! We aren’t interested in the product; we are interested in the how. This is where the true learning takes place, when the high-level process is the same, but the approach and methodology is different. 

Do they have more or less steps?  

  1. What order do they perform the steps?  
  2. Who controls the process? 
  3. How many people are involved? 
  4. Is the process automated? 
  5. What software is used? Was it purchased off the shelf or developed inhouse? 
  6. Efficiency rating – how is it determined? 

Once you determine your benchmarking criteria, pull off your blinders and identify organizations that perform the same process regardless of their industry. Their terminology may not be identical but the lessons you can learn (leading practices) are invaluable. This is the true power of Benchmarking. 

Get Started with APQC's Benchmarking Basics

This collection contains the main items you will need to start a benchmarking initiative, including templates, tools, a glossary, APQC's Process Classification Framework, APQC's Benchmarking Code of Conduct, and other articles that explain the steps required for successful benchmarking.