What is Benchmarking?
Benchmarking is the measurement of your organisation’s performance and processes, and comparing this to those of other similar organisations in the same industry. Benchmarking can be applied to products, services, processes or functions within the organisation and will be unique for different organisations.
What’s involved in Benchmarking?
- Identify areas to benchmark: Examples areas to focus on include Employee costs, Debtors and EBIT (Earnings before Interest and Tax)
- Collect financial and other related data: Quantitative data that will allow accurate comparisons
- Compare and Analyse: For performance measures to be meaningful, there should be a point of comparison, such as those of others in the same industry
- Monitor Performance: Make changes to internal processes as necessary in order to reach performance targets
Why should you Benchmark?
Organisations generally have strong knowledge about their own operations and what they are doing well. Although this is vital, it is also important to step back and evaluate how your organisation is performing in the broader marketplace. Doing so will highlight those areas of the organisation that require your focus and help take your business forward.
“Unless you try to do something beyond what you have already mastered, you will never grow” – Ralph Waldo Emerson
By studying the strengths of your competitors, you gain valuable insight into how to mange your business better.
Benefits of benchmarking
- Identify sales & growth opportunities – comparing strengths and weaknesses against competitor and identifying trends will help guide your marketing and growth strategy
- Assist with understanding cost structures and internal processes
- Increasing familiarity with existing performance measures and providing the opportunity to identify potential measures
- Motivate the organisation as a whole to work towards reaching performance targets and staying ahead of the game
How we can help you
The most tedious and time-consuming part of performing a benchmarking analysis is gathering the right financial data to be able to compare your business with others.
Being the auditor of several leading private schools in the education sector and aged care facilities in the not-for-profit sector, Accru Melbourne has exclusive exposure to the financial data of these organisations. We can provide you with a benchmarking report, supported with graphs and tables. This will allow you to gain an insight into where your organisation should next focus its attention, enabling its growth in line with other leading organisations in the industry.
For more information regarding Benchmarking, contact one of our Audit Specialists today on 03 9835 8200 or alternatively complete your details below and we’ll be in touch.