Our reputation for integrity and confidentiality enables us to collect and analyse comparative business data that is accurate and highly valuable.
This has been developed into a more formal service known as Prime Numbers TM under which we conduct a variety of Benchmarking activities.
Read on for a critique of the overall value of benchmarking, a general explanation of how we conduct it and how the results are displayed. Also there is a significant area devoted to the UKASTA Benchmarking initiative which is supported by the DTI's Sector Challenge.
What and Why?
Benchmarking can take a variety of forms -- essentially it involves the sharing and analysis of critical business data or practices through a third party intermediary to preserve the confidentiality of individual submissions and to produce aggregate results.
It is a technique which is being used increasingly throughout the international business community and public-sector organisations.
A recent study by Professor Chris Voss and his colleagues at the London Business School, looking at the relative performance of UK and US service businesses, provides an important insight into the value of Benchmarking. In particular, it was found that the financial performance of a company tends to be significantly higher among those that embrace benchmarking wholeheartedly.
The presentation below gives a summary of this work and provides a powerful endorsement of the value of a business culture which is outward looking, learning oriented and self critical.
Insert Voss presentation
How we do it
Typically, companies are asked personally to participate in a particular Benchmarking exercise. This can either be on a pooled cost basis or, for ad hoc ones, a particular client meets the cost involved.
In both cases, participants receive both the relevant forms and a full set of accompanying notes to make filling in the data as easy and painless as possible. The data involved can either be hard quantitative information or can relate to qualitative assessments or scores.
Increasingly, we are automating the process rather than sending out paper forms. This ensures that there are no transcription errors at this end and turnaround time is minimised. Furthermore, use of passwords and encryption mean that confidentiality is not only preserved but only PMS can "decode" the data.
Similarly, we can make the results available electronically so that the recipient database can be easily and immediately updated. In the future, we anticipate using e-mail for such communication.
An important point is that our detailed knowledge of the sectors in which we operate Benchmarking means that we know the real world ball park for the data. In turn, participants know that any duff data (whether by accident or design) will be recognised as such. This inside knowledge materially affects the accuracy of the input data.
In each survey, PMS undertakes not to disclose any individual results to third parties -- companies know that we cannot be "pumped" for confidential data. This trust, built up over many years, is vital to obtaining maximum participation and a meaningful sample.
These are normally in Average, Maximum and Minimum form, together with an indication of position in the league table. But, just as important, is our ability to look at sub sets of the data -- e.g. Small v. big companies, cooperatives v. family firms, predominantly full service agrochemicals distributors etc..
We also make full use of graphic analysis to maximise clarity of communication.
Benchmarking and Strategic Insights
Finally it is worth noting that we often use this approach as part of a wider, usually strategic, study. We might be wanting to confirm current margin levels or distribution costs. Quick and powerful insights can be gained by pooling data from key players on just a few parameters.
In this way, strategic insights can be more persuasive and internal norms can be challenged.
Indeed our current focus on Benchmarking in its own right has grown out of our use of the technique during consultancy assignments.
Our knowledge of the sectors in which we operate and the trust we have built up mean that we get high participation, accurate data and meaningful results.
This, in turn, means that the companies involved get high pay off and real insights.
Have a look at the UKASTA Benchmarking part of this site to get a real flavour of the kinds of activities we undertake in benchmarking.