Benchmarking Rooted in Social Comparison

Humans are social creatures. We observe and make comparisons. Sometimes hoping to fit in and other times wanting to stand-out. Comparisons give us a sense of both what is most common and the range of views, processes and outcomes. We observe those whom we admire and adopt their attitudes, repeat their opinions, and imitate their behavior often without realizing it. Benchmarking takes what we naturally do as individuals and makes it a deliberate, systematic process. We formally compare ourselves or our organization to others who share a common role, situation or industry.

Best Practice Benchmarking

Benchmarking is the process of comparing one's business processes and performance metrics to industry bests or best practices from other industries. Dimensions typically measured are quality, time and cost. In the process of benchmarking, management identifies the best firms in their industry, or in another industry where similar processes exist, and compare the results and processes of those studied (the "targets") to one's own results and processes. In this way, they learn how well the targets perform and, more importantly, the business processes that explain why these firms are successful.

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SimpleBenchmarks Approach focuses on informal self-reported benchmarks. The focus of a particular benchmark may be a common process within an industry or profession, a resource allocation issue, adoption of an emerging technology or compliance with new regulations. Almost, anything that a business owner or professional might "talk shop" with a colleague from another company while at an industry conference could form the nucleus of a benchmark.

One of the challenges with benchmark reports is determining whether the people or organizations to whom you are comparing yourself share enough in common that the comparison is valid and useful. SimpleBenchmarks helps the individual person or organization define who is their "peer" and then personalizes the report for each participant so that they see what their peers had to say on each benchmark question.


Definition from Business Dictionary