Benchmarking

Who’d have thought that Southwest Airlines could benchmark with NASCAR pit crews and drivers to get better at refueling planes and back into the air quicker?

Well, they did and got better. Today Southwest excels in turning their planes on the ground faster than any of their major competitors.

Webster dictionary defines Benchmark as (a) point of reference from which measurements can be made and (b) something that serves as a standard by which others may be measured.

Benchmarks alone are measurements, nothing more. While useful for setting goals, they provide little vision of what can be changed to improve performance and operational excellence.

Benchmarking is about learning, change, and improvement. It’s about identifying Best Practice, the techniques, methods, practices, technologies, incentives, and/or skills that lead to operational excellence.

Benchmarking alone, without the understanding the benchmark for operational excellence, is likely to lead to mediocre results. Benchmark, Benchmarking, and Best Practices are interrelated and co-dependent.

Benchmarking is a powerful management tool because it overcomes “paradigm blindness” and opens the mind to new methods, ideas, and tools to improve effectiveness.

In practice, benchmarking initiatives range from a continuous formalized procedure supported with dedicated resources to a one-off, one time event for a single project or application.

Xerox, an early pioneer of benchmarking (Benchmarking: The Search for Industry Best

Practices that Lead to Superior Performance ASQC Quality Press, 1989), is a good example of a enterprise wide benchmarking initiative with dedicated resources and support of senior management.

The short version of a benchmarking project is to first identify what to benchmark. What’s important to the business and provides competitive advantage?

Next, identify and collect the appropriate measures (benchmarks) for operational excellence, comparing your company to the benchmarks.

For many companies, just getting this far in a benchmarking project is an eye-opener, especially when the gap is large.

The last step is eliminating the gap and requires understanding Best Practices. Understanding alone doesn’t lead to change and improvement. Application, adaptation, and creative solutions lead to the pay off.

Benchmark your way to operational excellence…

John A. Miller

April 14, 2008

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