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In the context of organizational performance enhancement, "benchmarking" is the search for industry "best practices," activities that lead to superior performance. Organizations frequently benchmark with other companies, yet the capacity for organizations to absorb knowledge from outside the enterprise is as much a social as a technical process. The pace and scope of knowledge mobilization that is motivated by benchmarking depends upon the organization's willingness to share information, experiment, and work with outsiders. While innovation results from many knowledge management initiatives, learning- and knowledge-based organizations must embrace benchmarking as a process that encourages organizational plasticity through comparison and exploration. Benchmarking is all about listening to the winds of technological and process change to sustain a competitive innovation edge. It is a discipline that makes tacit knowledge whole and invigorates an organization with the knowledge to make informed choices. One of MITRE's knowledge management (KM) initiatives involves participation in an American Productivity & Quality Center (APQC) benchmarking study, which examines innovative organizations and their successful KM initiatives. An important part of KM at MITRE is knowledge exchange, both internally and externally. In recent discussions, Principal Engineer Cynthia Taylor Small said, "We believe that organizations that share and seek out best practices demonstrate visible dedication to the renewal of organizational knowledge. Important performance improvements through best practices transfer initiatives are realized by knowledge sharing of this sort. They can and should be considered the single most important employee activity in learning organizations." Benchmarking success stories abound, and proponents claim that benchmarking allows organizations to better meet customer requirements, determine true measures of productivity, and establish goals. Prudent organizations temper benchmarking eagerness with an appreciation for numerous known risks. The risk that a benchmarking effort will fail is increased if the sponsoring, or "host," organization does not agree that partners selected for benchmarking apply the best available technological, operational, or organizational processes. Benchmarking partners should not be selected simply because they are willing to benchmark or because the partners are vendors interested in attracting more business. Benchmarking should be approached on a partnership basis in which both parties expect to gain from the information sharing. Research on benchmarking best practices suggests that criteria for selecting benchmarking partners should be developed in advance, and an ample pool of benchmarking candidates should be identified. A candidate selection scorecard should be developed and applied in identifying relative benchmarking candidate ratings. A candidate selection scorecard (see illustration) was recently developed and employed by MITRE's Economic and Decision Analysis Center in benchmarking best-of-class information technology (IT) performance and strategy management systems for MITRE's Chief Information Officer. As depicted in the illustration, MITRE considered it essential that selected benchmarking partners clearly exhibit six key attributes or characteristics. The benchmarking candidates must have clearly demonstrated an interest in aligning the IT organization, strategic business unit (SBU), and governance activities; performance measurement expertise; commitment to leveraging knowledge; ongoing process quality improvement initiatives; and IT human resource innovation. Criteria for realistically and logically determining the presence of these desirable attributes within benchmarking candidate organizations were then identified. The candidate selection scorecard was then used to document sources relied upon in rating each candidate's performance against the attributes and key contributing criteria. As depicted in the illustration a traffic light (i.e., red, yellow, green) rating scheme was employed to characterize each benchmarking candidate. 
This candidate selection scorecard was developed and employed by a MITRE operating center to benchmark best-of-breed information technology (IT) performance and strategy management systems for MITRE's Office of the Chief Information Officer.
Benchmarking activities often fail if key benchmarking stakeholders do not support the benchmarking partners selected. Examples of key stakeholders include the managers responsible for funding the benchmarking effort and staff in the host benchmarking organization who will ultimately be held accountable for implementing best practices identified through benchmarking. The candidate selection scorecard, tailored to the specific needs of these stakeholders, can be used to substantiate and communicate the reasons why the host benchmarking organization should compare processes and performance with selected best-of-class external partners. Experience suggests that the most desirable benchmarking candidates may not necessarily have the time nor the motivation to meaningfully participate in another organization's benchmarking activity. Organizations deemed best-in-class are typically deluged with benchmarking requests and can thus afford to be selective about benchmarking partners. It is recommended that host benchmarking organizations identify many more candidates than will ultimately agree to benchmark, and it should be expected that some selected partners will decline a benchmarking invitation or may back out of the benchmarking at the last minute. It is also recommended that host benchmarking organizations balance their desire to benchmark only the best organizations with the need to partner with organizations that are eager to openly share relevant information before, during, and after the formal benchmarking activity. For more information, please contact Kevin Buck using the employee directory. |
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