Deafening Silence — Failing to communicate in times of chaos…

Posted on November 9, 2011 by Bob Champagne

Climate chaos wreaks havoc again…

Once again, the Champagne family has fallen victim to climate change in the Northeast, or at least two unfortunate weather incidents, whichever your personal/political inclinations require. First came hurricane Irene, and then, last week, the early fall snowstorm. Fortunately for me, I only suffered two days without power, as I was traveling on business for the week. Unfortunately for my family, they were asked to endure almost a week without power, as the outages in the Northeast lingered and local utilities struggled to get customers back in service. But, as of last night, the lights have come back on and life has gotten more or less back to normal.

As I wrote a few weeks back in my “Eye of the Storm” post, nearly every customer understands the nature of uncertainty and can recognize what are, and what are not, predictable/preventable and unpredictable/unpreventable circumstances. Hurricanes and early-season blizzards certainly fall into the latter category. But let’s face it, while we all get angry and frustrated, we are also able to temper, at least somewhat, our emotional responses when we recognize that such events are beyond anyone’s control. There are, however, aspects of such situations that ARE within our control. And failing to deal with these in the face of unfortunate events…no matter how controllable or predictable…can leave us with a feeling of legitimate anger and frustration. Such was the case with the extended power outages this past week.

Crisis management — it’s all about eliminating uncertainty…

I’ve talked a lot in recent months about sources of satisfaction, and, perhaps more importantly, dissatisfaction. But I keep coming back to “fear and uncertainty” as the biggest driver in today’s world, and perhaps the most critical in times of crisis, whether it be natural disasters, political upheaval, or simple technological failure (three whole days of no Blackberry service?). And while we may view much of this as being “out of our control,” as CCO’s, our response in terms of customer communication is ALL within our control.

How to #FAIL

So imagine the frustration of customers when they experience the following (all of which are real examples my family encountered during the recent storm event):

– A website with detailed outage map showing the number of affected customers in each town, and a link (which turned out to be just “bait”) to outage status updates. The status update reported that 95% of customers would be restored within five days. It wasn’t until you clicked a few more towns on the map (assuming you did) that you realized this was a “general” update and not specific to anything. Moral of the story — if you know nothing definitive about the situation (which they clearly didn’t because they were still assessing damage), then admit as much and state, instead, when you DO expect to have meaningful information to share. Lame (and possibly misleading) attempts to suggest that you’re providing legitimate and specific updates when you are not is easily seen through.

– The company’s use of social media during the peak parts of the outage was virtually non-existent. Less than ten Twitter messages during the first 24 hours of the outage, conveying insightful information like “We know there’s an outage”, “This was a really big storm”, and “Stay away from live power lines” could have been administered by my 95 year old grandmother, in terms of content provided (she apparently knew as much as they did) and technological savvy (she may very well know more than they do about how to leverage social media). IRONICALLY, my wife learned that our power was restored by a FRIEND via FACEBOOK!!! And when the information from the company did start coming out, it was hitting their feed well after the updates had already unfolded. And instead of displaying the feed prominently on their website, they buried it behind the “Follow us on Twitter” button (if you personally didn’t go track their Twitter page, you were “SOL,” as they say). In their defense, I suspect there may have been just one single employee responsible for managing all of these updates, but that’s a subject for another post. The company clearly spent tens of millions on the recovery effort. How much effort did they expend on communications and messaging throughout the crisis? Feels like very little.

Now THIS was a useful message!!!!

– A 500+ word letter from the CEO of the company explaining to us in lengthy, florid prose pretty much the same thing — This was a big storm, it was unprecedented, we are trying our best, and reasserting the general commitment of 95% by x date…which means NOTHING to an individual customer. To add insult to injury, we had to listen to the CEO pontificate about how this was the most challenging thing he’s experienced in his career, and how proud he is of his staff, and how concerned he is about his puppy who is out in the cold (OK, the latter is an embellishment of what was really said, but you get the idea). Spare me the lecture on what you can’t do and tell me what you can!!!

– An outage center (automated phone line) that asks (begs) you to report the outage and risky situations, but offers NOTHING else during the automated call, not even the most general, non-specific, non-committal statements, which, admittedly, would have frustrated me…but let’s at least be consistent. All that told me was that they cared a lot about what I could do for them in terms of providing information, but very little about what they could do for me. Heck, it would have been nice if they’d at least asked me to tell them if I’d seen repair work in my area. This might have suggested that they had some interest in learning about the status of restoration (even if they didn’t know themselves).

This entire ordeal, which plays out every time there’s a natural disaster or big crisis event (be it flight delays, hurricanes, or war zones), is becoming an interesting one. We are witnessing a sea change (or maybe it’s a teachable moment) in how we can and should deal with such situations. And it’s becoming clearer that customers (not companies) will probably be the best sources of information during these events. Social media offers a great conduit into that feedback and has proven time and again to be the best medium to solicit and report real-time feedback. The process has clearly changed, perhaps unbeknownst to the company. That, to me, is not only the emerging solution given today’s technology, but the most obvious.

How about we beat the incumbent at his own game?

What is not so obvious is the degree to which companies that we have entrusted to be the “custodians” of information — companies whose primary role is to service customers — remain so clueless as to the most effective ways of providing that service. They appear to be, at best, blind to, and, at worst, simply resistant to using these new channels and changing their internal processes to accommodate them. They are in the best position to aggregate customer information from the variety of channels available, merge it with what they know operationally, and report relevant and meaningful information in real time. Oh and, by the way, imagine the customer engagement you’ll achieve along the way!!! — the ultimate in crowd-sourcing for customer service. But, sadly, this doesn’t happen, and probably isn’t even on the radar screens of most firms. Instead, the more likely scenario is that they will be bypassed completely by some more agile and responsive third party (or perhaps an unseen competitor) that sees in this challenge an opportunity to leverage information and create a unique and refreshing new solution to an age-old problem.

COULDN'T SOMEONE PLAY THE ROLE OF AGGREGATOR OF UPDATE AND STATUS INFO, AND THEN DISTRIBUTE IT TO THE MASSES USING BOTH SOCMEDIA AND CONVENTIONAL CHANNELS????

History has shown us that customers react favorably and swiftly to this sort of innovation, by shifting their loyalty and their dollars to those who demonstrate a willingness and ability to solve problems. All of which leaves me wondering how it is that the company I’ve entrusted to solve these problems for years could be so utterly incapable of recognizing the possibilities and seizing upon the solutions that have been staring them in the face all along.

I recognize that this is a tough assessment and a somewhat emotion-driven “rant” at an industry I’ve spent considerable time advising over the years. And, make no mistake, there are some awesome utilities out there that will step up to the challenge with these and other creative solutions. But, at the same time, there are many who prefer not to rock the boat, to play by the old rules rather than invent new ones. And it’s these organizations I would like to see upstaged quickly by a more innovative and competitive force. Not to wax too lyrical here, but in the stormy waters of competition, your boat is rocking whether you want it to or not!

Fear and uncertainty — Make it go away with clearer, more relevant, and timely communication. You’ll overcome the barriers that stand between you and a base of engaged, satisfied, and loyal customers.

-b

Author: Bob Champagne is Managing Partner of onVector Consulting Group, a privately held international management consulting organization specializing in the design and deployment of Performance Management tools, systems, and solutions. Bob has over 25 years of Performance Management experience and has consulted with hundreds of companies across numerous industries and geographies. Bob can be contacted at bob.champagne@onvectorconsulting.com

Metrics that make you go…YAWN…

Posted on October 28, 2011 by Bob Champagne

Inspiring or Uninspiring? -It all starts with the strategy…

On each client engagement, regardless of type (Business Planning, Assessments, Turnarounds, Process Improvement, etc.), we invariably find ourselves working extensively with what I call the company’s or business unit’s Strategic Performance Framework (i.e., the specific goals, objectives, and KPIs of the area in focus). That is because these three critical elements serve as the foundation for everything that follows. It essentially answers the proverbial question “For the sake of what? (FSOW?). FSOW are we making this or that investment? FSOW are we developing a new product? FSOW are we consuming resources to improve a specific business process? FSOW are we changing our organization chart (again…)?

Without a thorough analysis and understanding of goals, objectives, and KPIs, any plan that is developed will simply be a formalized road map for throwing darts at a wall. Goals and objectives tell us the destination. KPIs give us continuous feedback as to whether or not we’re on course for our journey, or if deviations from plan are occurring.

This shouldn’t be new to many of us, as any manager worth his salt understands the basics of strategic thinking and performance management. Yet, when we step back and look at the organization or business unit in total, it’s not unusual to observe some big “cracks” in the foundation. And often it is often the KPI’s and metrics that are the first indication that the strategic underpinnings of the business unit are starting to get shaky.

Strategies vary…and so should KPIs…

Working with as many organizations as I do, you would naturally expect the destinations of each client to be different. Take “customer contact” organizations, for example, where there are clearly a myriad of contributions that the organization can be set up to achieve — providing purely reactive service, converting leads, driving participation in customer programs, increasing market share, retaining customers, building loyalty… the list goes on. And most often, these goals and objectives do, in fact, differ from company to company (although there is a growing tendency among managers to “follow the pack” where goals and objectives are becoming more about “maintaining the course” than about providing new and inspiring destinations — a subject for another day!)

But despite the wide array of strategies we expect, and often see, we still find that nearly every customer service organization focuses on the same operating metrics. Back to the Call Center for a moment, here’s a list I can almost guarantee that EVERY company focuses on.

Speed of Answer/Service Level
Abandon Rate
Call Queue Length
Average Handle Time
Agent Satisfaction
Agent Availability/Productivity

The list goes on…

No matter how different the objectives are for the Customer Service channels, the measurements (the things the reps care most about since they influence everything from raises to career progression) remain the same. Don’t believe it? Next time you see your call center manager at the coffee machine, ask them what the top three measures of success are for their group. Try the same question with the reps themselves.

How can that be? Dramatically different destinations, yet metrics that tell you little about progress toward the destination, assuming your mission is something other than churning calls, tasks, and shifts.

Are you “de-motivating” your workforce?

This is clearly a sad state of affairs, because it not only tells us how disconnected our day-to-day activities are from our strategy (read PURPOSE), but really exemplifies how intellectually lazy our strategic planning processes have become. Assuming the organization has developed a compelling and inspiring purpose (which many have, but most still lack), very few have a set of KPIs that track with it. Worse yet, most of these KPIs (the ones above that have been measured for decades) scream for more clarity, consistency, and targets based on something other than “finger in the wind” aspirations or the “annual 5% improvement.”

And as these KPIs trickle down into the organization, their relevancy begins to wane exponentially. What can a call center manager or rep do from one day to the next to drive an outcome like average service level? Sure, there are long term strategies to “course correct” when negative trends emerge (better forecasting of workload, more flexible staffing strategies, etc.), but what about day-to-day behavior? Most often, this is left to the intuitive feel of the operating manager and their motivational style, which can affect consistency and effectiveness over time. Even if you end up measuring things that are “conventional” or somewhat dated, failing to link these in some coherent and causal manner to the organization’s broader goals will undoubtedly elicit the proverbial yawn…that is assuming they haven’t already dismissed the metrics as irrelevant.

Waking up your strategies and KPIs…

So here are my five tips for “waking up” your customer metrics:

Make sure they are built on the foundation of a compelling and clearly articulated strategy. If your strategy doesn’t get you out of bed energized every morning, you’ve got more work to do. Resist the temptation for that “follow the pack” 3-5% improvement gain from last year. What is it your business unit is really there to accomplish? Think business outcomes (sales, leads, changes in customer disposition, etc…) rather than operational activities (calls answered, transaction speed, etc…)

Line up your tactical objectives to your strategic purpose. If your goal is, say, to improve customer loyalty, then your objectives should revolve around the known drivers of loyalty. And avoid the “circular answer” to these questions. An objective for attaining loyalty is NOT to improve transaction satisfaction, but more likely, to eliminate the need for the transaction in the first place.

Develop relevant, clearly understood, customer-centric KPIs. Should you really be measuring, “average service level”, or should you be measuring the number of times a call exceeds 20 minutes, or the number/percent of calls that get dropped prior to resolution, etc. I’d submit these are bigger drivers of loyalty and dissatisfaction than, say, average queue lengths or duration of after-call work. Think one or two levels beyond what you’re currently measuring. Think drivers versus macro results. If you’re on a journey from New York to California, a measure like service level is akin to telling you what state you’re in when it would be more helpful to know when you go off course by x%.

Make metrics relevant at the department level AND the work face — the best metrics are those that can be discussed and improved at any level in the organization. If your objective is to eliminate a particular source of dissatisfaction, then declare what that driver is and measure it at every level across the business. Get the organization talking in the same language and counting things the same way, and you’ll be tracking a lot closer to your desired outcome.

Having a set of metrics for the sake of measuring things is not only a waste of time, but can be a real distraction to achieving your desired outcomes as a business. If your mission, goals and objectives have been declared in a clear and compelling manner, then do yourself a favor and spend some time making sure your metrics will guide you toward that outcome.

-b

Service In the Eye of the Storm…

Posted on September 15, 2011 by Bob Champagne

Stuff Happens…

We’ve all been there. The cancelled flight. The lengthy power outage. The inconvenient disruption in internet communications. Higher than normal dropped cell calls. You’d think that whoever is calling the shots on the weather patterns lately would know the magnitude of chaos they are creating in our lives. It’s enough to drive you nuts!

God grant me the serenity to accept the things I cannot change…

Hurricane Irene, though relatively tame to a gulf coast native like myself, once again forced me to reflect on how storms like this can disrupt life’s little conveniences. On the one hand, it’s quite amazing how stressed and freaked out we (including yours truly) get with what are, in the end, minor inconveniences–many of which would be regarded as luxuries elsewhere on the planet.

Let’s face it, we’re all human, and while we get as frustrated as the next person when inconvenienced, we all are capable of realizing and accepting that certain events simply fall into the category of “S**T HAPPENS”. While nobody likes to wait on hold for two hours to talk to an airline, most of us “bite our tongue” when talking to the agent because we know they are probably as stressed, if not more so, than we are because of what they’ve had to endure during the time we were on hold.

…and the wisdom to identify idiocy!

On the other hand, it is equally amazing, given the advances in service capabilities and technology, that we are unable to avoid, or at least help customers to tolerate, the downstream impact of these events. Consider the following examples from last weekend’s flight mess caused by multiple airport closures in the Northeast.

Text message informing a passenger of a canceled flight fifteen minutes after the last alternate departure
Text message instructing the passenger to CALL the airline for additional information, exponentially amplifying an already uncontrollable workload/call volume
Call-in number with an automatic message that says essentially, “we have too many incoming calls, call back later.” Really? A six-billion-dollar Fortune 100 company in 2011 with a message like THIS?
Call queues (for airlines who, under normal circumstances, pride themselves on differentiating between “tiers” of frequent fliers”) that suddenly lose all such distinctions in the midst of a crisis–with hold times from two to three hours throughout the weekend
A website containing little if any useful information on the situation at hand, self-help suggestions for what I could do in the meantime, or anything else that might have alleviated the stress
Complete absence of any visible “behind the scenes” or back office process to re-book flights automatically (my reservation was essentially cancelled leaving me to re-book myself with no apparent prioritization for my loyalty status
A workforce that, despite all their effort and hard work, (and I do mean hard work because they had 200 reps working what I estimate to be at least 300,000-500,000 displaced passengers), did what???

Crises are the real MOTs…

There has been a lot of talk in recent years about “Moments of Truth” (“MOTs”) when it comes to service interactions. We often think about MOTs from a transaction standpoint, e.g.,when a customer calls to connect service, ask a billing question, get updated about a service interruption, or simply to complain about an inconvenience. For me, though, the real MOT is what happens in a true moment of chaos or crisis–when the customer’s daily life is truly interrupted, i.e., when they actually expect things to suck. It’s at that moment, when natural optimists become pessimists, that one of three things happens:

Customers’ bad expectations are realized, either creating or reinforcing a perception that when unforeseen events occur, things will inevitably become hopeless, i.e., a feeling of general resignation.
Lowered expectations become their worst fears…and you become recognized as the company that falls apart rather than shining in the face of adversity.
They are completely “WOWED” by the significant, yet counter-intuitive, responses they see from you at a moment when they have every expectation in the book for not doing so.

For most of us, it’s typically the first experience, and we move on with our lives, disappointed but not surprised. We remain only marginally engaged, and perhaps, when the next opportunity presents itself to switch to another supplier, that new supplier may have the proverbial “edge”. But for companies who really understand these dynamics and strive for true loyalty, they know the power of the third outcome above, and the value that small, but memorable, responses can have in these real MOTs.

What if…

…I had received a text message telling me that an adverse weather situation was unfolding and that by responding “helpme” to their text, they would search for available options and contact me to see if I wanted to initiate any of these two or three alternative plans? What if the message I heard when I called (instead of “We’re busy. Call back later.”) had directed me to a website that contained actual useful information (even if nothing more than “We’re at the mercy of the weather and the airport, and we won’t know anything until tomorrow at 2 p.m.”)? What if instead of my reservation being cancelled, they had proactively re-booked me on another flight? And what if (perhaps for only their million-mile customers) they had actually offered me some REAL solutions, like, for example, flying on a different airline or going through an unconventional (perhaps even inconvenient and uneconomic) routing.

Insanity=

Doing the same thing over and over again, and expecting a different result…

We all understand crises and uncontrollable events. We all know that we cannot blame an airline or a power company for things like earthquakes, weather, some mechanical failures, and the like. And we know, as well, how inappropriate it is to blame the people who are doing their best in a bad situation. But I would argue that in a time and era where margins are thin and everyone is looking for new ways to differentiate themselves…and particularly in a time when customers have been conditioned to expect the WORST from us…that is the perfect time to step up and offer creative and inspiring solutions.

Some of these may be BIG things–the kind of heroics you hear about in commercials, performances that border on the uneconomic and, perhaps, unrealistic–solutions that would drive a company to the poorhouse if they were truly institutionalized (Can anyone forget the FEDEX driver who couldn’t get the drop box open, so he lifted the entire multi-hundred-pound box into the back of his truck?). But I would contend that it’s the little things that mean the most–the things that show you’ve had the FORESIGHT to understand how a customer is truly affected in a crisis. ANTICIPATE your customers’ most likely state of mind in these situations, and develop small solutions that can, in fact, be INSTITUTIONALIZED.

-b

A CPO’s Declaration of Independence

Posted on July 4, 2011 by Bob Champagne

At its core, the word “independence” means being free of outside control or influence.

We celebrate independence from many things: from the oppressive control of people and governments, to simply becoming independent from our once protective or “controlling” environments. Every 4th of July, we in the United States celebrate our national independence from prior years of British control, and its declaration of that freedom in a charter that would define the very freedoms and liberties we in the US enjoy today. Most often, when we celebrate “independence,” whether it is as a nation or as individuals, we are celebrating a moment in time, or a phase when that independence is either declared, demonstrated or both.

But there is another type of independence we should also celebrate, i.e., the act of distancing oneself from the (isolated, blind, and often inappropriate) influence of another person or organization’s actions. It is more of a “state” that an organization exists within, and one that defines the boundaries of its existence, than it is a single event or moment in time. Such is the case with most corporate oversight and regulatory functions that have emerged in recent years.

As an aspiring young auditor over 20 years ago, I remember this type of independence being drilled into my head more than any other directive in my early career. It’s a principle that has shaped both external auditing as a discipline since its inception over a century ago, and one that has defined internal auditing now for decades. It is also a principle that today defines most common forms of regulatory and oversight functions, particularly when issues like safety and security are involved. But these functions, while sometimes viewed as oppressive in their own right, were initially set up to prevent inherent conflicts of interest that arise in the absence of “common sense” checks and balances.

While many would call these functions a “necessary evil,” their independence and objectivity gives us comfort that someone else is watching–someone who does not necessarily have an “axe to grind” or a “dog in the race.” And if positioned correctly, this independence can also be a powerful enabler for the business by providing outside and unfiltered information and perspectives that are not easily observed by day-to-day operating management. Learning how to create that balance is critical to any function performing in that type of advisory or oversight capacity.

Today, the role of the Corporate Performance Manager, or Chief Performance Officer (CPO) as some companies have positioned it, is one in which the concept of independence and objectivity is becoming increasingly critical. Just as auditors have had to weather the perception of being the “bad guy,” so it is as well for the CPO. In fact, many companies that have deferred making the decision to have a Corporate PM function, have done so to avoid creating another oppressive layer of control, and avoid the animosity that might get created between operating and corporate management. But it is these organizations who sacrifice a very significant benefit that a Corporate PM function can deliver. I would submit that it is not the presence of independent advisory or oversight functions that create these problems, but rather the way they are set up, chartered and managed that does so.

So how does this sense of “balance” get created?

Here are some common traits of successful Corporate Performance Management functions that have been able to use the principles of independence and objectivity in a way that enables more collaborative success, while providing the healthy oversight and control that is desired by the firm’s Board, Officers and Shareholders:

Organizational Independence and Visibility- Just as most Audit functions have a corporate responsibility to the CEO and Board of Directors, so it is the case with most successful corporate PM organizations. By the very nature of their reporting relationship to the CEO (or equivalent), they eliminate the very conflict of interest with specific business functions that can compromise more integrated and synergistic solutions from occurring.
Strategically Balanced– Their charter is driven by the Firm’s Balanced Scorecard, rather than limited subsets of operating metrics that may yield more limited operational successes at the expense of the more balanced set of business outcomes desired by shareholders
Non-Threatening- While their ultimate customer is the CEO, they view operating executives as a key enabler of, and partners in, their collective success. They do this by addressing issues and performance gaps in a way that makes the operating unit become successful in the eyes of the Firm’s C-Suite and Board, rather than their own visible value add.
Removing Barriers- One way they become viewed as genuine partners with operating management is that they use their corporate visibility and influence to break down barriers (like corporate politics, access to information, and cultural roadblocks) and unlock value that has often eluded operating management.
Inclusive and collaborative– Good PM functions are inclusive, not only with respect to their approach, but also in their delivery tactics. They often staff their departments with people from the operating units themselves (using short term and rotational assignments), increasing their operating credibility and ultimately developing real PM champions across the business.
Facilitative– These functions are far more facilitative in their approach, rarely performing direct roles in developing conclusions and implementation. While results are often the same as those they might have developed themselves, playing a background role and “leading” the operating staff to the right answers ultimately strengthens operating ownership for the conclusions and changes that ultimately emerge.
Share the Joy– Good PM organizations are often generous in giving credit for operating changes directly to operating executives. While they are successful at tracking corporate value delivered by the PM process, the credit for the implemented changes is often given directly to those who implement it.

The "bad cop" perception that is often ascribed to corporate oversight functions will never get eliminated completely, and will continue to be a factor as Corporate PM groups proliferate across the industry. By its very nature, there will always be times where their responsibility to the CEO and Board will result in the development of recommendations or the presentation of information that benefits the collective whole, rather than the specific interests of a particular business unit. But more often than not, the type of synergistic value we are looking for can make heroes out of operating executives while still benefiting the collective Enterprise.

So on this Independence Day, let’s remember that we can still preserve the independence and objectivity our profession requires, while being a strong force that liberates and frees our operating executives to reach their goals and ultimate potential.

When Benchmarking Gets “In the Way” of Good Performance Management…

Posted on June 27, 2011 by Bob Champagne

Nearly three decades after benchmarking came on the scene, companies still claim it to be an integral part of their internal performance improvement processes. But few would argue that its value to the business is now well below where it once was. And sometimes, it actually gets in the way of identifying improvements and driving change.

There is not a client I work with who doesn’t have their shelves lined with volumes of benchmarking studies and reports. Nearly every industry group produces some kind of comparative metrics report for its members. And every industry has those companies that we might consider to be “benchmarking addicts” — those who participate in nearly every study they can in the spirit of demonstrating their performance improvement “commitment” and “prowess” around driving change. Ironically though, it is rarely these companies that define the top tier of their respective industries in terms of real performance.

Here are some inherent flaws with benchmarking today:

Benchmarking is largely “point-in-time” driven and retrospective in nature. While this can be useful in “stress testing” targets and defining high-level gaps (“low-hanging fruit” or “quick wins”), it largely ignores the trends or shifts in metrics that are far more critical to identifying and driving course corrections.
Comparative studies almost always focus on lagging versus leading indicators. This often leads to a culture of “managing through the rear-view mirror”. It also fixates the organization on measuring things for the sake of comparisons, when some of those metrics may have have become irrelevant or even obsolete.
Benchmarking focuses on “common metrics” versus those that may be critical to you, but perhaps not everyone. It’s okay to have a few metrics you routinely measure for the sake of comparison, but when these metrics begin to define your scorecard, it’s time to recognize when the “tail is actually wagging the dog”.
Comparisons are done for many reasons, not all of which are performance driven. More often than not, benchmarks are used to identify strengths for the sake of communicating to shareholders, regulators, or sometimes even internal Executives. They’re sometimes even a vehicle for rationalizing and justifying poor performance, often confusing the organization and sending all the wrong messages.
Benchmarking often leads to “group think”. We look for commonalities and like to follow the “herd”. Let’s face it — It lowers our risk to say, “if company x is doing such and such, then we should be doing it too.” But it’s sometimes the anomalies in the data that can show us where real innovation is happening. And in the benchmarking world, anomalies are often dismissed as outliers and suggestive of data problems rather than solutions.

These are just a few of the many ways that benchmarking “gets in the way” of real change, and there are many more where these came from.

As with anything we do long enough, it’s easy to get into a corporate habit of doing something and forget WHY we are doing it in the first place. So if you want benchmarking to be a value-adding component of your performance management process, here are a few things you can do:

Realize that benchmarking is about you, and not about others. It’s fine to use comparisons to help you better understand yourself and your performance weaknesses and perhaps “stress test” your targets, but when you start using benchmarks to rationalize and justify existing performance and actions, it’s time to refocus your thinking on you and your company’s improvement goals and the learning benchmarking can provide.
Determine where benchmarking fits into your overall performance management process, and use it that way. In cases where benchmarking is done for some other reason, like communicating to stakeholders or regulators, call it what it is and keep it at arms length from the game of real performance improvement.
Focus your benchmarking on the measures that matter to YOU rather than a consultant’s peer group or client base. More often than not, it may be better to do a small internal project to gather that competitive intelligence, than it would to consume resources to force-fit yourself into a large peer group.
Orient your benchmarking around learning and innovation, rather than simply “following the herd.” This will sometimes cause you to look at different metrics, and look at them differently. Anomalies will become a source of new innovation rather than simply a data problem to discount.

Benchmarking can be a great tool for defining, catalyzing and inspiring change in your organization. Take a hard look at how your organization uses these comparisons today and be honest with yourself about where this supports or hinders your performance management process. Make benchmarking part of your performance management process rather than an end in and of itself.

Category Archives: Corporate Performance Management