The State Comparative Performance Measurement Project: Benchmarking Organizations Provide a Forum for Information Exchanges on Business Practices, Strategies, Solutions to Common Problems, and Innovative Ideas
Mucha, Michael J., Government Finance Review
Many governments benchmark or compare their performance data against data from similar organizations. Of course, the term "benchmarking" can be defined in different ways, not always yielding the same results. While comparing data is the primary activity involved, organizations undertake benchmarking efforts so they will be able to use those comparisons to improve performance. But simply collecting measures, compiling data, and publishing a report are not enough to accomplish that goal. Managers must be engaged; they need to analyze and interpret the information, and use it to set policies or make informed decisions.
This is where participating benchmarking organizations can be valuable as part of an overall performance management approach. Being a member of a benchmarking organization ensures that measure definitions are consistent and data is collected uniformly to facilitate comparisons, but it also provides a forum for information exchanges on business practices, strategies, solutions to common problems, and innovative ideas. Benchmarking organizations play a vital role by organizing and coordinating the exchange of information and ideas needed to improve results in key service areas.
To generate service improvement, benchmarking organizations fulfill several specific roles.
Defining Common Performance Measures. Comparative data means that organizations have consistent data definitions and use the same method of data collection. To be effective, performance measures also need to be defined in a way that provides useful information without being overly burdensome to the government. If an organization has too many measures, or measures that are too complex or difficult to collect, the data collection effort runs the risk of being costly, misunderstood, and easily manipulated. Defining performance measures requires functional expertise in each particular subject matter and an understanding of the goals of each membership organization.
Ensuring an Apples-to-Apples Comparison. Comparisons lose their value if there is a mismatch in data sets. Avoiding this problem requires vigilance. Benchmarking organizations need to set collection rules carefully and verify that all information is collected in compliance with its rules.
Organizing and Publishing Data. After the data is collected, benchmarking organizations provide the valuable services of compiling information, analyzing it, and publishing it. Many benchmarking organizations use a shared services model, giving each membership jurisdiction access to the same technology system for inputting and displaying performance data. The same systems then allow access to that data so managers can review it.
Bringing People Together to Share Ideas. In addition to reviewing the data, many benchmarking organizations hold annual conferences, training sessions, and other events that allow members from different organizations to network, share practices, and collaborate on solutions to common problems that were identified by the data. Sharing information is essential for successful benchmarking. Information sharing is more common in the public sector than in the private sector, and where services are similar, governments should pursue every opportunity to learn from the experiences of peer governments.
On the local government level, a few organizations have been successful at using comparative benchmarking to help start the sharing of practices, strategies, and ultimately ideas. The ICMA Center for Performance Measurement and the North Carolina Benchmarking Project are two of the best-known examples. Other successful groups include the Florida Benchmarking Consortium, the Ontario Municipal CAO's Benchmarking Initiative, the South Carolina Benchmarking Project, and the Southeastern Results Network. In fact, of respondents to a recent GFOA performance management survey, 31 percent of jurisdictions that said they use performance management indicated that they collected a common set of measures across the organization and shared data with other organizations. …