Why does benchmarking often fail?

Benchmarking has been in vogue for a long time as an important tool to improve an organisation’s products and processes. There is often pressure on operating people to benchmark against leaders in their own industry and sometimes even against leaders in other industries.

While a few benchmarking efforts end up delivering the expected benefits, we have seen several cases where the projects fail to improve the organisation’s operations. It’s important to analyse, using the insights of Dr. Goldratt, why some projects fail miserably while many others deliver extraordinary value.

Mind over matter (Emotion – Intuition – Logic)

In my opinion, improvement projects are best conceptualised, owned and implemented by people who are passionate about their business and want it to succeed despite innumerable challenges in their competitive environment. They are emotionally invested into the business.

Such people know the intricacies of their business, unknown to outsiders. They know what works and what doesn’t, where the strong and weak spots are. They develop strong intuition about the operations. Given a challenge, they would intuitively come out with what the underlying reasons could be and what the potential solutions would look like. This intuition is many-a-times crucial to get to the actual root cause.

Having intuitively identified a few hypotheses about the cause and possible remedial action, they would apply thorough logic to check whether the root causes identified are indeed responsible for the current situation or not. They would also check whether the proposed actions will lead to the desired outcomes. Analytical and logical rigour is a must at this stage. Their analysis would also indicate if there are any undesirable side effects of taking the proposed course of action, which needs mitigation.

The pre-requisites of emotion and intuition complement the logic. Since logic is a linear phenomenon and a left-brain activity, moving straight to Logic doesn’t work in a lot of cases. We are likely to overlook a probable root cause and a few possible courses of action, identified by right-brained intuition.

Typical benchmarking failures

Let’s now see how benchmarking projects are typically carried out.

Organisations would identify a process to be benchmarked and set up a team to discuss this with other companies, who have successfully deployed a more efficient version of the process.

I have come across instances when the team is entirely from the Central Process Improvement Cell. Discussion with the benchmarked company mostly hinges on the logic of what has worked and why it worked. When the team tries to apply the same logic in their own context, it doesn’t work, especially if the pre-requisites of emotion and intuition are absent. The team then blames it on their unique context and refrains from benchmarking in future.

The power of an emotionally invested team

If we truly want our benchmarking efforts to succeed, there is a better way. It starts with selecting a team of employees who are passionately involved in the current operations and want to improve it. The team has probably tried several options in the past and developed strong intuition about the possible root causes and the alternate actions to address them.

If this team contacts other successful companies and discusses what has worked for them, they are more likely to come back with several viable alternatives to try out after applying strong analytical and logical rigour to the options. The likelihood of success is much higher for this team of emotionally invested employees.

Next time you embark on a benchmarking project, remember to take care of the Emotion-Intuition-Logic sequence.