Operating a business means knowing what makes your competitors tick, whether you are doing it the brick-and-mortar way or the online way. In the global marketplace, learning where you stand is vital in helping you write your flight plan for success. By comparing yourself to those with the same business, you get an idea on what needs to be improved. You learn better practices out there, and sometimes, you may adapt them to suit your own goals. Welcome to the World of Benchmarking!
The Benefits of Benchmarking
Do you really need to go through all the fuss of benchmarking? YES. Benchmarking helps you:
1. Get realistic goals for your business
2. Avoid being led by the big leagues in the global marketplace
3. Create a big room for challenges, new ideas, and improvements
4. Motivate your team for success
5. Identify the strengths and weaknesses of your people and business
6. Justify the need for a CHANGE
What Approach is Best for Benchmarking to Work for You?
What’s great with benchmarking is that there is NO one formula that works for all. It means letting your imagination do the talking. You can choose one, or combine any of these four processes:
- Strategic Benchmarking – is where you assess the strategies used by your competitors in the global marketplace, like checking their technology portfolio.
- Functional Benchmarking – is when you investigate how a business performs, without focusing on your direct competitors.
- Best Practices Benchmarking – is when you look into your competitor’s “best practices,” or the way they manage their employee and customer relationship.
- Product Benchmarking – is studying your competitor’s products, comparing it with your own. You may compare designs, functions, or even the cost of production.
Are There Ways to Benchmark for Success?
If you’re planning to expand your business, then, benchmarking is your golden key to success. All those data collection may take precious time and effort, but not without merit. To make benchmarking work for your global business, you need to follow these magic seven secrets:
1. Identify who your tough competitors are. The more you can get, the better you can learn where your business needs to improve.
2. Keep it legal when you do your comparison, especially in matters concerning fair business practices and exchange of sensitive data.
3. Be UPDATED. Keep your eyes wide open for changes, even in a millisecond.
4. Hiring someone to benchmark for your business? Choose wisely and always count experience as your top priority.
5. Try Variety. Don’t just play it safe and benchmark against competitors you know. Widen your horizons. Compare locally and globally.
6. Learn the value of courtesy and secrecy. Here is where the golden rule applies: Do unto others what you want them to do for you. Don’t sell data that is entrusted to you or use it for other purposes.
7. Stop being a Scope-Creep, or you might as well be the twin of the business you are comparing with. Give space for originality.
In the end, benchmarking should give your business that jump start to make unique products and services that will cater to the needs of your target customers. Try to avoid being another copycat of some big league industry you are trying to beat. Benchmarking should only be your reference point, nothing more or nothing less. Play It Fair!