What are the most effective ways to ensure your benchmarking process is objective?

While it is true that benchmarks will be more useful if they allow you to compare with very similar companies, more general benchmarks are also useful. The issue is that the more niche the benchmarks become, the less strong the statistical relevance is. For example, if the criteria you use are very narrow, you might be able to compare your company to a handful of similar ones. If the benchmarks criteria are broader, you will compare against 100s or 1000s of companies. Benchmarks provide guidance. They allow you to ask the right questions. So, striking a balance between using criteria that are too narrow or too broad, is the key.

Objektivität ist für einen Benchmarkingprozess ein kaum zu erreichendes Ziel. Benchmarking ist vergangenheitsorientiert und erfordert zusätzlich zu den herangezogenen KPIs eine Fülle von Kontextinformation, mit deren Hilfe die Vergleichsdaten normalisiert werden müssen. Für jedes Benchmarking ist daher das Bewusstsein erforderlich, dass die Auswahl von Vergleichsobjekten sowie nützlichen KPIs immer vom Zweck des Benchmarkingprojekts, den Kontext- und Metadaten zu den KPIs einschl. deren Datenqualität abhängig ist. Benchmarking kann dennoch ein guter Ansatz sein, jedoch sollte man sich der immanenten Grenzen dieser Methodik bewusst sein. Prädiktive und präemptive Datenanalysen können u.U. zu besseren Entscheidungsgrundlagen führen.

I would say that a combination of all 5 of the aformentioned points are relevant: the more complex your operation already is, the more beneficial it will be to, essentially, follow SMART & KISS principles.

Segregate your objectives into individual segments where progress can be tracked by relevant data sets. This basis for effective benchmarking is also key for effective execution. This gives you insights into what changes are required to drive which particular metric to get the desired result. Example: You want 300 Sales Qualified Leads(SQLs) generated in a month. Your channels Google Ads, Website, Blog, Email Campaigns and Sales Outreach. However, all these leads may not become Sales Qualified Leads. If you can track the Lead to SQL conversion ratio for each channel, and benchmark it across a series of 6 months, you can know which channel is working, what to invest in and where to eliminate wastage. A critical insight to be aware of.

The sources that rely on surveys can be misleading. Many times, the respondents don't remember the right values, or half of them give last months data and the other half a month before. The best sources for benchmarks, are the tools that take data directly from the data source API, and they refresh this data daily. Databox's Benchmark Groups is such a tool, but there are a few more out there. The key here is to understand how data are collected and what this means for your use case.

Benchmarking is useful in understanding competitive intelligence, advantages/disadvantages, relative buyer/supplier power, due diligence, pricing and innovations in the marketplace. Yet the intrinsic value of benchmarking resides in formulating relevant insights based on the strategic imperatives of an organization. Simply put - benchmarking is a tool in your toolbox. The real value is in knowing when to use a tape measure instead of a hammer. Impactful results are predicated on subject-matter-experts who hone in on actionable insights from comparative research.

A single data point may be misleading. Always combine benchmarks together and involve stakeholders. An example. You might see that your bounce rate in Google Analytics is much worse than companies similar to you. This doesn't say much unless you also see your performance for Average Time on Page. If you outperform there similar companies as you, it doesn't mean that you perform badly, it just means that you have a different strategy than them. Involving other stakeholders in this process, allows you to get a better understanding and clarity on what this means for you and if you need to adapt your strategy and tactics.

Regarding business performance, there are three things you need to consider: - Historical data Compare your performance to what you did in the past. - Benchmarks Compare to other similar companies in real time. - Forecast How are you expected to perform in the future? These three things were only available to enterprise companies in the past, as smaller companies needed either an in-house team, or a big budget to get access to all the tools needed. Today this is not true. Historical data, benchmarks and forecasting tools are easily available, even for free. Use them! They can be a game changer for your business.