I’ve participated in a lot of projects where one of the first questions is: How are our competitors doing it? Are there any benchmarks or nationally-recognized “best practices?”

While this may give a team a sense of security, or help to push stretch goals, sometimes I think it stifles creativity.

If we are developing, or redesigning, a process in the best interest of what OUR customers value, do we really care how others do it?

As I said to a group of leaders recently: “Who cares how someone else does this? Let’s US be the benchmark!” (OK, I was challenging them to think outside the box, not to ignore the competitive environment!)

When I present or teach, there’s a great demand for case studies. And while seeing how others do things can bolster our confidence (if they can do it, we can!), sometimes I think it’s taking the easy way out – just seeing what others have done so we can copy that – instead of inventing our own, least-waste process with our our unique customers in mind.

In fact, I have a mentor (Chuck DeBusk, thank you!) who does not use the term “best practice” as it may be “best” in the organization that developed it, but it’s not “best” for us unless we have the same customer diversity, value concepts, leadership, organizational culture, physical layout, vendors, computer systems, etc.

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So my question for the day is, what has your experience been in regards to benchmarking? Good, bad, indifferent? Helpful to set stretch goals, or perhaps you were led to set a target beyond your capability? A way to garner new ideas or something that suppresses innovation? I’m curious to know your experiences!

Comments 6

  1. michael cardus

    I agree the challenge is how are the others teams doing it comes up.
    My context is different – yet the idea is the same. When working with groups I use many team building activities (active learning simulations, systematic team development initiatives, etc… what ever you call them)
    These are used to highlight certain goals and objectives such as cycle time reduction, data graphing, team leadership etc..
    It always happens the question of "what is the fastest this has ever been done?"
    1 of 2 things happen.
    1) because the time/height etc.. is so massive the group feels that the benchmark group cheated
    2) they give up because it is so high.

    You are right often times people feel a comfort of saying "well at least we are better than xyz company"
    The challenge is how do you motivate them to be the industry standard. That takes time, money, set-backs, dismissed ideas, challenge to status-quo.
    Is the trade off really a desirable state? or is just beating and being in the range of our competitors enough?

    I feel that often time it is enough, UNLESS the company is ready to go through a full process of setting industry standards, and is fully aware of the pros and cons.

  2. taaxx

    (if they can do it, we can!),

    thank you ..

  3. Fang Zhou

    First, I have to clarify what I mean by "benchmarking" and "best practices."

    Benchmarking is about the best performance in meeting the CTQ, or customer requirements. It is "how WELL" a process meets the need, not "how" it does it.

    Best practices are best ways to perform specific tasks, which may or may not have anything to do with what the customer needs.

    The difference to me is similar to that between the process Y and x’s, or between Key Process Output Variable (KPOV) and KPIVs.

    I believe that benchmarking challenges our limits, courage and imagination, but it doesn’t stifle creativity.

    I use benchmarking when improving a process at the value-stream level or when designing/redesigning a process. Changing the end-to-end process can create innovative solutions to best meet customer needs. So knowing the best-in-class performance by benchmarking is critical to setting the right target (or stretch goals). My experience is that such changes are highly complex, time-consuming and costly. In pharmaceutical R&D where I support, it’s extremely difficult to define the right performance metrics to benchmark. Designing a value-stream level process based on wrong benchmarks can be fatal.

    Most improvement projects I have seen (even if involving value stream mapping) are at a lower level than the value stream. They often focus on efficiency or waste reduction. In these cases, learning and implementing the best practices in similar operations is a quick way to achieve savings and free up resources for subsequent improvement. The goal here is not to be the best, but better than we were. In this aspect, learning from others absolutely helps.

  4. Sue Kozlowski

    Fang Zhou makes a great point about the distinction between benchmarking for results and evaluating best practices for methdology.

    taxx, in your succinct way you have given us a way to use benchmarking as a motivational lesson!

    I have also seen some great examples of cross-industry comparisons (Who else besides hospitals handles bed turnover issues? Hotels – so can we go study them for learnings?)

    Thanks for your insights –
    Sue K.

  5. Narayan

    "Best practice" can vary in impact with context. It can only be a generic reference example to evolve one’s own best practice.

    Benchmark is about what has been achieved by others. The concern here seems to be that with a high benchmark comparison, one may become complacent. This may apply to a small % of companies. From benchmark we should derive our percentile position. Those high on the percentile may find satisfaction. But it certainly drives a major part of the industry who are below. You suggestion is suitable for those who have reached a high level in all fronts.

    Striving to be the best is likely to become the goal of the leaders. The wiser ones would obviously strive to be better than the best. That is how every thing has improved all along.

    I welcome benchmarking as it is a base lining process to know where we stand in the world. It certainly prevents laggards into thinking they are doing their best and hence it is OK.

    Improvement should always be with respect to customer expectation. If customer needs are far above the best benchmark, even achieving high benchmark levels are not enough. Kano model tells us that in hygiene factors there is no more customer satisfaction to be obtained than being high in the benchmark. In performance factors, better than benchmark performance can be targeted.

    I used the word customer need above, and not customer expectation. Expectations are set by reference to what has been achieved by the industry. Needs can often be higher. As low as possible, as high as possible, and a target number with some tolerance band about the target are three ways we express results. Wherever we have AHAP and ALAP, there is a need for being better than the best benchmark.

    There are also occasions where a expectation can be set at a unrealistically too high level. I once faced a situation where, an unattainable cycle time metric that included some external factors was high in my customer’s mind. Since external factors dominated this and were beyond control, we had to show benchmarking to focus on other worthwhile factors.


    Benchmarks tend to be a good reality check. Good or Bad. As i’m currently consulting a company and shared these metrics it’s more of the understanding of how it effects their overall bottom line. Either with service levels or cost pers’ provides an open opportunity to evaluate their current position.

    Other assignments saw area’s where they out performed the benchmark. Analysis on customer behavior were almost inline. Here’s food for thought…. As we continue to have everything within…seconds…. Is our customers behavior turning into individuals with A.D.D.? I’ll be first to raise my hand especially when reviewing websites. If it’s not pleasing to my eye, even if you have a good product…. I’m off to the next until I resonate with it.

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