What is the best way to use benchmarking for competitive advantage?

1 Define your objectives

Before you start benchmarking, you need to have a clear idea of what you want to achieve and how you will measure your progress. What are the key performance indicators (KPIs) that matter most to your business? How do they align with your vision, mission, and values? How do they relate to your customers' needs and expectations? By defining your objectives, you can focus your benchmarking efforts on the areas that will have the most impact on your success.

2 Choose your benchmarks

Once you have your objectives, you need to decide what and who you will benchmark against. There are different types of benchmarking, such as internal, external, competitive, functional, or generic. Depending on your goals, you may want to compare your performance with your own past results, your direct competitors, similar organizations in different industries, or industry standards and best practices. You also need to choose the sources of data and information that you will use for benchmarking, such as surveys, interviews, reports, or online tools.

3 Analyze the gaps

The next step is to collect and analyze the data and information that you have gathered from your benchmarks. How do you compare with them in terms of your KPIs? Where are the gaps and opportunities for improvement? What are the strengths and weaknesses of your processes, products, and services? How do they affect your customer satisfaction and loyalty? By analyzing the gaps, you can identify the areas that need the most attention and prioritize your actions.

4 Implement the changes

After you have identified the gaps, you need to plan and execute the changes that will help you close them and improve your performance. What are the best practices that you can adopt or adapt from your benchmarks? How will they benefit your business and your customers? What are the resources, time, and budget that you need to implement them? How will you communicate and involve your employees and stakeholders in the change process? By implementing the changes, you can enhance your efficiency, quality, and innovation.

5 Monitor and evaluate

The last step is to monitor and evaluate the results of your benchmarking and change initiatives. How have they affected your KPIs and your competitive position? Have you achieved your objectives or do you need to adjust them? What are the challenges and risks that you have faced or may face in the future? How can you overcome them or mitigate them? How can you sustain and improve your performance over time? By monitoring and evaluating, you can ensure that your benchmarking efforts are aligned with your strategic goals and deliver value to your business and your customers.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?