How to Source Data for Benchmarking? Once you know what to benchmark the next step is actually to start the benchmarking process...
The Importance of Training and Business Advise in Benchmarking
While benchmarking is an essential part of growing businesses within an industry by measuring their progress the key to successfully doing that is active participation. Members need to actively participate by providing valuable data about critical areas of their business. Each individual company needs to make a contribution without which even the best software can’t guarantee actionable results.
Training and advice when it comes to benchmarking help encourage participation by giving business owners the information they need to make the best of the data they get. By creating awareness associations can encourage more member businesses to take part in the process. However, when it comes to training and workshops, the quality matters more than the quantity. That’s something we’ll be discussing this article.
Tip: Associations which have never run benchmarks should start by educating members about its benefits. It should be assumed that member businesses don’t know much about benchmarking and need to be educated in most industries.
What the Stats Show?
In the majority of benchmarks, an average of 15% of participating businesses is using the outcomes to their advantage. The rest of the members and participants are perhaps just reading the report, may or may not be getting insight and moving on with their daily routine. Over time these people will stop participating in our experience.
Associations need to encourage businesses to do more with the results they get. They should use it to start competing mainly based on the results. That is after all the objective of the Compare to Compete method which compares performance so that a business can compete. So, the goal of these businesses should be to beat the benchmarking performance indicators and in turn, become the benchmark for their industry or niche. Though achieving that requires training and workshops which are actively run by the association.
Organising workshops and Training Sessions
Benchmarking is like GPS; it can tell a member organisation where they are in terms of their potential to grow, current situation and which way is the best way to go. All participating businesses want to improve their performance, but that’s only possible if they know where the competition is coming from in this regard. So, a top-quality report is the very first step. But they also need to know how to make sense of the report, and that’s where organizing workshops and training sessions come in.
The sessions should teach how to use the outcomes of the benchmark to improve a business’s strategy. That will help companies to get insights from the report which they may otherwise be missing out on. It will for all intents and purposes encourage them to do a little more than they usually do to compete. For instance, businesses may start discussing the outcomes of the benchmarks with their teams, perhaps brainstorm ideas to improve sales or marketing, etc. all of which will lead to better performance.
Various Types of Training Sessions
Before we go into training member businesses, it is essential to understand that whether it is a webinar, in-person training, a workshop or an one-on-one training session the quality matters. Another thing that matters is what your potential members are receptive to for instance some may prefer an in-person seminar compared to a webinar. So, your choice should be what the majority of members want for the most part.
The best type of training and webinars are those that offer simple, direct and practical advice to businesses. They would be like business advisors but in this case, provide a more general type of advice. Things that should be covered are how to interpret the results of the report, what data matters and how to use it, what needs to be done to improve performance, how to evaluate where the business stands in the grand scheme of the industry etc.
Every forum, workshop or webinar should have a discussion on performance improvement with all the participants both offline and online. Plus, the experts should be available for Q&A.
Always Discuss the Outcome of Benchmarking
During any benchmarking discussion with members, one of the things that should be discussed is the outcome of the benchmarks. Discussing the outcome will include teaching the participants about the report, how it is laid out and what should matter most to them and why. This aspect of benchmarking discussion will motivate members to take a closer look at their report and chalk out strategies. It will also drive them to participate.
During our years of offering benchmarking services, we’ve also provided training. The training was and is mainly focused on teaching members or participants on how to go from being just a static to the benchmark themselves. If anything it motivates them to compete with the competition instead of accepting that there is nothing they can do to beat often larger competitors with more resources.
Associations will want to bring in trainers with a diverse background which ranges from marketing to finance, and HR. Also, trainers who are specialists in a particular industry have a significant impact.
It is also imperative that the training is interactive so that people learn from trainers but also can learn from each other. Discuss best practices, difficulties and address various concerns.
Note: Having more than one trainer may also work. The number of trainers does not matter so as long as they help member businesses.
Analysing individual and Collective businesses
Now apart from group training and webinars associations should also offer some individualized services. One such service that works very well is an individual analysis of a company along with expert business advice. You may have already decided to offer this and if you have then now is the time to deliver.
The expert whether he or she is in-house or a consultant should be familiar with the industry, be a reputed expert and have a portfolio showing success of their own. Once you have made sure that this is the case, they should sign an NDA as business owners, i.e. your members will be sharing a lot of information with them. After all, that information is required for the expert to offer good advice.
The expert should read the benchmark report, then perform a thorough performance analysis and find areas of improvement for each business that participates. Sure! This is often difficult even if the report is very well done and relevant but because interpreting the results and understanding why a particular business is underperforming is a challenge it is also time-consuming. So, extra time may be required for the expert to speak with the business owner and find out a couple of more things before advice can be given. However, at the end of the day, the time and money spent in this endeavour are well worth it.
Finding the Reason for Good or Bad Performance
Individual analysis helps to discover why a business is doing well or if it is underperforming. That will give participants some insight into what features, policies or elements can be changed in order to improve performance. It is these insights which make benchmarking so imperative.
Various indices like the revenue per employee is an excellent basis for doing proper analysis. If you don’t have indices, it is hard to run a good analysis. Various base values like how many employees a business has and the revenue it generates provide insight about its structure. The trend analysis also helps provide information relating to growth relative to competitors in the industry. That said the most information can be had with cross analysis on the indices for both a given period as well as its development over a period of time.
The Job of the Business Expert
The business expert will take the report and write an analysis which takes all variables into account. However, he or she will not use reports which are not already available with the participants that means he has the same information as the members. This expert then either meets with the participant or has a video conference to explain what they found and discuss steps which can be taken with the business owner.
It is only with thorough expert analysis that a participant is able to see why their business is behind and what can be done to improve. Plus discuss alternative action steps to boost areas of improvement like sales. All of this also helps motivate the business owner and their employees to work towards growing the business and participating in similar performance benchmarks.
Taking the step from analysis to consulting and advice is a small step. However, it holds significant value for business owners and members who see themselves struggling without expert help. Perhaps the most effective is if all this effort leads to drafting a comprehensive action plan for each business based on their strengths and unique approach. That is what contributes to the growth of the industry and helps associations become increasingly larger and profitable too.
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