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Should You Benchmark?
Should you benchmark your marketing and operations?
Yes… Benchmarking is important as a measurement tool. It highlights
strengths and weaknesses. It provides tangible data for planning and
implementing change. Sometimes benchmarking by itself will improve a
company’s performance. Reviewing processes, procedures, and results can
stimulate productivity and inspire change by creating awareness.
…and no. Traditional
benchmarking with industry standards and best practices is dangerous
unless you understand every nuance. Benchmarking originated as a
methodology for comparing similar companies. It is useful for a company to
look at industry leaders and model best practices. Unfortunately, there
are few companies in the direct marketing industry with enough similarity
to effectively utilize traditional benchmarking.
The best benchmarks are
established internally and utilized as change agents to improve service,
productivity, and profitability. The first benchmarking initiative is a
three-step process. It begins by establishing a baseline. This is done
with an internal marketing and operational audit. Next, improvements are
planned, tested, and implemented. The final step is to perform another
audit and compare the results with the baseline. Once the initial process
is complete, audits should be performed on a regular basis to insure
continuous improvement.
Tips for successful
benchmarking:
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Plan the benchmarking
initiative carefully. What are the objectives? What needs to be
measured? Who are the players? When will it be complete?
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Define your objectives
by internal needs instead of external standards. There are common items
that should be included in every initiative: Order dynamics,
productivity analysis, and process review. There are also unique items
that should be included. Make sure that you include the items that
differentiate your company.
-
Be specific with
benchmarking expectations. Improve order turnaround 10%; reduce
fulfillment costs 15%; and increase acquisition 5% are all specific and
measurable. General goals usually result in no improvement.
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Reward employees for
successful initiatives. It creates excitement, improves morale, and
increases benefits.
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Present the initiative
as a method for improving work conditions and service. Employees are
less resistant to change when they are participating in the process and
understand the objective.
The key to successful
benchmarking is to clearly define the objectives and focus with
consistency and collaboration. Order and customer dynamics show how well
you are serving the customer. Fulfillment and marketing costs show how
well you are serving your company. Find the balance that keeps everyone
happy.
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