What is Benchmarking?

Introduction

Wake Tech is North Carolina’s largest community college, serving more than 74,000 adults annually, with six campuses, three training centers, multiple community sites, and a comprehensive array of online learning options. Wake Tech is accredited and offers more than 200 associate’s degrees, diplomas, and certificates that prepare students for university transfer or immediate employment. The college also offers short-term, non-degree programs in IT, healthcare, hospitality, public safety, skilled trades, and more. Their vision is to reach out to the entire part of Wake County and let them know that Wake Tech can help them go as far as their dreams, talents, and resilience take them. Wake Tech structures its operations, training and educational programs around the core values of accountability, respect, responsibility, critical thinking, communication, and collaboration (“About”, 2020).

Wake Tech community college currently uses the contemporary management technique of sustainability. Currently, Wake Tech balances its short and long-term social, environmental, and financial goals to maintain its performance. Wake Tech community college would benefit from using the Benchmarking contemporary management technique. The benchmarking technique would allow Wake Tech to be able to use their critical success factors that have been identified, along with viewing how other community colleges at their same level achieve their critical success factors and implement techniques that would help them to maximize their performance compared to their competitors.

Benchmarking

Benchmarking is the process through which a company measures its products, services, and practices against its toughest competitors, or those companies recognized as leaders in its industry. Benchmarking is one of a manager's best tools for determining whether the company is performing particular functions and activities efficiently, whether its costs are in line with those of competitors, and whether its internal activities and business processes need improvement. The idea behind benchmarking is to measure internal processes against an external standard. It is a way of learning which companies are best at performing certain activities and functions and then imitating or improving on their techniques. Benchmarking focuses on company-to-company comparisons of how well basic functions and processes are performed. Among many possibilities, it may look at how materials are purchased, suppliers are paid, inventories are managed, employees are trained, or payrolls are processed.

Benchmarking will enable Wake Tech Community College to determine what the best practice is, to prioritize opportunities for improvement, to enhance performance relative to customer expectations, and to leapfrog the traditional cycle of change. It also helps Wake Tech to understand the most accurate and efficient means of performing an activity, to learn how lower costs are actually achieved, and to take action to improve cost competitiveness. Because of the many things benching marking can help a company accomplish, benchmarking has been used in many places as a tool for obtaining a competitive advantage. Wake Tech can undertake benchmarking with a view towards the many improvements that it may offer. These benefits include reducing labor cost, streamlining the work flow through reengineered business processes and common administrative systems, improving data center operations through consolidation and downsizing, cooperative business and information technology planning, implementing new technology, outsourcing some assignments and functions, redesigning the development and support processes, and restructuring and reorganizing the information technology functions. Wake Tech Community College would benefit from using the benchmarking technique to help their college grow and become a better, and more efficient workplace.

The goal of benchmarking is to identify the weaknesses within an organization and improve upon them, with the idea of becoming the 'best of the best.' The benchmarking process can help Wake Tech to find gaps in performance and turn them into opportunities for improvement. Benchmarking would enable Wake Tech to identify the most successful strategies used by other companies of comparable size, type, or regional location, and then adopt relevant measures to make their own programs more efficient. Wake Tech can apply benchmarking as part of a broad strategic process. Using the benchmarking process, benchmarking can find breakthrough ideas for improving processes, support quality improvement programs, motivate staffs to improve performance, and satisfy management's need for competitive assessments. Benchmarking focuses on these things in order to point out inefficiencies and potential areas for improvement. Benchmarking targets roles, processes, and critical success factors and this will benefit Wake Tech to better achieve their long-term goals and future plans.

Implementing Benchmarking

Knowledge comes in many forms. One such form is the knowledge that is distilled from comparing one organization’s performance against another’s in order to gather critical information about business processes, risks, and controls, and develop metrics by which to improve performance. This is called benchmarking. Effective benchmarking requires that you are wise enough to realize your organization has weaknesses, which translate into business risks and determined enough to do something about those risks. Benchmarking must be managed correctly and methodically to be successful. It is not simply a venue for collecting data, rather it is a tool for critical insight, which can motivate change and lead a company to more efficient, effective and innovative business practices. “Benchmarking has been described as a “structured process” that enables organizational improvement. The emphasis on embracing a structured approach during benchmarking is a fundamental tenet of best practice benchmarking” (Al Nuseirat, El Kahlout, Abbas, Adebanjo, Punnakitikashem & Mann, 2019).

When beginning the benchmarking process, Wake Tech needs to select the business process to benchmark and build support from both upper and middle management in order to gain the appropriate resources and to foster the spirit of participation required in an effective benchmarking initiative. Not targeting a specific process to examine or attaining management support will almost certainly mean that the benchmarking attempt will fall short of its goals. Selecting the process means determining which processes or issues are critical to the goals of Wake Tech, and whether benchmarking is the appropriate method to determine the efficacy of the process. In this initial process, it is important to gain commitment from management, process owners and staff to participate eagerly on the benchmarking project, and then to develop an action plan to focus efforts and keep information organized.

In the next process, it is crucial to determine the state of the current business environment. Too often, companies embark upon benchmarking efforts because they want to achieve the well-known results other companies may have had with this process. This is misguided because benchmarking is company and issue specific. Without a clear understanding of the business environment and the impact of specific business processes on overall business performance, benchmarking will fail to yield meaningful results. Before benchmarking Wake Tech against another to discover how they achieve high levels of business performance, one must understand their own performance. An initial self-assessment should include questions to determine if the process has been flowcharted; if the process owners have been correctly identified; where key handoffs exist within and outside of the process; if automated and manual activities have been identified; and finally, if redundancies or inefficiencies have been targeted.

During the time spent learning more about the business process under examination in the previous process, there will have been some suggestions for improvement. The next process will compare the improvement suggestions quantitatively and qualitatively to other processes, internally, externally or both. The first part of this process should be to determine the “should be,” and choosing potential benchmark partners. Benchmark partners are organizations, including Wake Tech, that are successfully executing the process being examined. Determining the “should be” is where the company begins to focus on examining the process from an external perspective, conducting secondary research to supplement internal exploratory efforts and discovering which criteria are important. This understanding will lead Wake Tech to the most appropriate benchmark partners. Being prepared by gathering quantitative information in advance of the benchmarking efforts will balance the odds in Wake Tech’s favor so that the benchmarking initiative will be a success.

The next process is to consider where Wake Tech should be and subtract where Wake Tech is at. This difference is the performance gap. The larger the gap, the higher the priority to narrow it. In this step, it is important to consider a host of issues and try to analyze them logically. For example, examine a process from a cost, quality, time and productivity perspective, with the understanding that strength in one area does not necessarily indicate strength across the board. For performance gaps to be useful, they must be logically identified, organized, and categorized. This means in part that the causal factor behind the gap should be attributed to people, process, technology, or cultural influences. In addition, each gap should be ranked based on a priority indicator.

The next process to consider is to design an action plan. There are several ways to ensure that the benchmarking efforts produce positive results. One way is to use goal-oriented, attainable, and detailed action plans to plot the improvement course. An action plan template should include a description of the overall action plan detailing each specification step and each problem the actions are targeted to solve. The action plan should also describe the chronological steps to implementation, defining requirements and specifications, and allotting an appropriate time frame for the implementation. Finally, the action plan should identify those accountable for implementation and describe rewards if their efforts are on time or ahead of schedule. Perhaps most important is to ensure the action plan has been accepted by all key parties, including management, process owners, and those affected by the proposed change. 

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