A fashionable management concept, Benchmarking is often misunderstood or misapplied. Benchmarking is about attitudes that are curious and open to change - simply put, it is the means of focusing on business improvement through learning and applying best practice from other organisations. Yet, without the desire for integration into the business planning cycle, benchmarking is no more than an expensive, academic exercise. In the public sector, this is a particular problem in that it is often viewed as a means to gain publicity rather than a vehicle for real change.
In benchmarking, there is a need to be realistic in what one can achieve against the background of organisational culture, especially where either high level policy decisions have already been taken or significant investment has already been made in systems. Underpinning this realism is a need to establish appropriate protocols for exchanging information, especially where one is dealing with cross boundary tendering or potential competitors.
The involvement of senior management and end users is vital in that studies have consistently shown that on average, organisations in which senior management vigorously supports benchmarking, more consistently gain operational benefits and see higher financial paybacks than do other organisations.
Data collection is not enough - it is crucial to understand the reasons for performance so that improvements can be made. Simply copying other people's practices probably won't work. Post-war Japanese industry grew famous not for copying but for successful adaptation of Western management theory and industrial technique. Most public sector organisations compare themselves with traditional comparisons, yet the most productive benchmarking comes from imaginative sources.
Put simply, it is a management tool that helps managers objectively identify areas for improvement within their own operations and to work with others to improve them. One of the key issues facing managers today is the difficulty...