It’s popular and if you’re not doing it now you probably will be before long: benchmarking.

There’s always a need among businesses, especially when times are tight, to make sure they’re working up to potential.

The best way to do that is to compare your achievements with your peers, industry expectations, or even your own standards.

Sure, you know in your gut if you’re doing well or not. But how can you demonstrate for higher management that Purchasing and Procurement is hitting on all cylinders, and improving as you go?

By measuring what you do, you’ll do more than establish a means of comparison. Benchmarking is also a key element of ongoing improvement and innovation. It promotes better communication between departments and a healthy sense of competition that can improve a company’s overall efficiency.

Fortunately, you don’t need to hire a pricey consultant or purchase a complex software package to set up your own benchmarking system.

Four basic steps — easily handled in house — will set the stage for you and get things moving:

1. What do you need to measure? Identify the key processes you want to track and how you’re going to achieve that. Examples: Picking efficiency, order management, returns for damage, etc.
2. Come up with a plan. It certainly doesn’t have to be complex. Determine how you’re going to gather, record and evaluate the information.
3. Determine what you’ve learned. What areas merit extra attention? Rank them by importance, so you can focus on only one or two projects at a time. Otherwise, it could become overwhelming.
4. Phase in the changes. Train workers, set new achievement benchmarks, provide good working examples — these are all ways to begin applying what you’ve learned through the benchmarking process.

Tags: benchmarking, order efficiency, picking, procurement, purchasing