Governments are increasingly using benchmarking to improve organizational performance; to determine how well their organizations are performing through measuring and comparing their actual performance with others. This article provides examples of best practices and lessons learned for organizations looking to build capacity.
What is benchmarking?
Benchmarking is a process in which organizations assess their performance by measuring and comparing their processes and results to other organizations. This allows managers to identify improvements that will enhance organizational performance. There are several aspects to benchmarking:
- establishing rigorous performance measurement regimes;
- comparing an organization’s performance with other organizations; and
- using this information to improve the organization’s performance, including by learning from best-performance organizations.
Benchmarking can enhance the ability of governments and public organizations to reduce costs and improve service levels, as well as communicate their performance objectively, promoting accountability to stakeholders and citizens.
• The leading benchmarking centre in North America is the American Quality and Productivity Center in Houston, Texas (www.aqpc.org), which provides performance benchmarking services and best-practice identification for a wide range of private and public organizations.
• The State of Texas has mandated the Center for Organizational Excellence at the University of Texas to measure and benchmark the performance of all public agencies and institutions of higher education in Texas. The Center uses a Survey of Organizational Excellence to measure organizational performance. All state organizations are required to assess their organizational environment on a biannual basis and link the data to organizational improvement plans. Organizations that have made distinctive progress in performance are recognized by the Governor’s Texas Star Award. Best practices examples, such as Texas Real Estate Commission and Texas Applied Research Laboratories, were able to transform to “world class” by measuring and benchmarking performance and by taking action in the areas requiring improvements (http://www.utexas.edu/research/cswr/survey/site/).
• The Florida Department of Revenue (FDOR) has been benchmarking its internal and external performance for several years with similar organizations in the U.S. as well as with Ontario, B.C. and the Canada Revenue Agency. FDOR is a winner of the Florida Sterling Award, which is the highest award for organizational performance and management excellence in the state (http://dor.myflorida.com/dor/report/performance_measures_fy200708_q3.pdf).
• The City of Coral Springs, Florida, is another Sterling Award winner. It annually measures and benchmarks performance on both efficiency and outcome measures with other cities, and posts the information publicly on its website. In 2007, it became one of the few public organizations ever to win a Baldrige Award for organizational excellence, given by the U.S. President (http://www.coralsprings.org/baldrige/GettingStarted/index.cfm).
• The inter-governmental Institute for Citizen Centred Service has a national benchmarking service (http://www.iccs-isac.org/en/cmt/benchmarking.htm) built around the award-winning Common Measurements Tool (CMT), which measures satisfaction with government services. The Royal Canadian Mounted Police, Service Canada, Service British Columbia, and the Region of Peel are among the many public sector organizations using the CMT. Recently, other governments such as New Zealand, Singapore and South Australia have adopted the CMT, opening the potential for international benchmarking of service performance through the ICCS. For example, the New Zealand Police and the RCMP are now able to compare and benchmark their citizen satisfaction levels, since both are using the CMT in their annual citizen surveys. The RCMP has used the CMT in its national citizen-satisfaction surveys since 2003 and its latest national survey results show that 83 percent of Canadians were satisfied with their service. This is considered an outstanding performance for a police force, which generally score in the 65 to 80 percent satisfaction range, according to U.S. benchmark data.
• Benchmarking is also being applied in human resource management across Canada. The provincial, territorial and federal public service commissioners measure and benchmark employee engagement scores using a standardized list of nineteen common questions, built around the known “drivers” of employee engagement (see Schmidt and Marson in CGE, February 2008). In 2008, seven provinces and territories benchmarked their employee survey results with each other. Importantly, this benchmarking process demonstrated that employee engagement scores in a number of jurisdictions including British Columbia are steadily improving (see Lee Herrin in CGE, October 2008).
• The Ontario Municipal Benchmarking Initiative (OMBI) measures many areas of municipal service performance including efficiency measures. According to OMBI: “The Ontario Municipal CAO’s Benchmarking Initiative is the result of a CAO partnership effort to continuously strive for service excellence in municipal government. Participating municipalities are working together to identify and share performance statistics, operational best practices and to network in a spirit of innovation and entrepreneurship to push for even greater successes” (http://www.ombi.ca/index.asp).
• Within the Government of Canada, the Treasury Board has established the Management Accountability Framework (MAF), which identifies essential elements (followed by a series of indicators and associated measures) for sound management of federal organizations. It is both a tool to measure progress in management improvement and for reporting on the state of management performance across the public service. The MAF allows comparison among federal departments/agencies, and tracks the overall management performance of the public service (http://www.tbs-sct.gc.ca/maf-crg/index-eng.asp).
• The Organization for Economic Cooperation and Development in Paris recently launched a benchmarking initiative called “Government at a Glance” to help countries benchmark performance on a number of key indicators (http://www.oecd.org/document/12/0,3343,en_2649_33735_37688524_1_1_1_1,00.html).
Good practices in benchmarking
So what should public organizations do for successful benchmarking and performance improvement? Effective benchmarking requires that organizations adopt certain key practices, including:
• Consistent and regular measurement: It is important to ensure a rigorous and systematic approach to measurement. The approach should be sufficiently robust and consistent across organizations for successful benchmarking but flexible enough to meet the unique needs of each organization. In addition, the measurement approach should be “reporting light,” and primarily rely on surveys and strong information systems that don’t burden managers.
• Providing baseline information: Understand the starting point, and track progress over time. Baseline information is required to determine whether the progress is being made over time. This comparison can be made to an organization’s own performance, against similar organizations (business line, size, complement of workforce), or against a set of norms or standards that apply across several organizations.