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Benchmarks: What do they really mean relative to my day to day responsibilities?

5 Dec, 2011 By: Jeff Kelly, Jerry Newberry imageSource

We have all heard about the numerous industry benchmarks for sales, service and operations. There are differing views from industry experts on the importance of allocating to the correct industry parameters and how to use the benchmarks to identify where your focus should be in order to improve the overall performance of your business. However, many that promote the importance of achieving benchmark performance do not fully understand how to integrate the activities required to actually achieve them, along with the current responsibilities required to run the business.

Benchmarks: What do they really mean relative to my day to day responsibilities?From our collective experience, which has involved working with all size of companies ($2M to over $80M in total revenue), we bring a unique perspective on benchmarks, and achieving them. We (Pros Elite Group) have worked with over 250 companies within the past 10 years and want to share our hands-on knowledge with you. So let’s consider the following:


The management team in a typical dealer, regardless of size, is spent reacting to the day to day activities required to run their business. The management team knows that they need to look at their performance to benchmark. However, they have 15 plus hats they wear throughout the course of a typical day and the time that they have available to drill down into their performance results is somewhat limited. So the challenge is a simple one. How can I most efficiently measure and evaluate my performance to the industry standards? What key benchmarks do I need to focus on and what are the key drivers that influence my benchmark performance results? And how do my employees’ day to day activities drive my measurable results? More importantly, how can I create a process that allows me to consistently drive my company’s performance to benchmark while wearing the 15 plus hats I need to keep up with the day to day demands of my business? Does this challenge sound familiar?

Success Profile:

The companies that consistently achieve benchmark performance results, while providing unparalleled levels of customer service, have some key success traits in common, including:

1- Implement the correct Industry benchmarks within your organization (we are still seeing the older benchmarks from 5+ years ago being promoted).

2- Ensure revenue and expense allocations are correct (a model is useless without this being accurate).

3- Trust the model. This is being proven day in and day out in thousands of companies throughout North America.

4- Don’t buy into all the excuses why the service financial model can’t be attained (e.g. “we sell at very low cost per copy rates” or “we work in a higher technician salary area”). We have never seen this be the cause for not attaining 52% service margins.

5- Know your opportunity areas operationally & financially. Laser focus is needed to drive high service margins and operational performance - and regardless of what you read from others, fixing operational inefficiencies substantially improves the level of service to your customers and the moral of your employees.

6- Great companies don’t monitor service operational performance on a monthly basis alone. Monthly analysis of service performance is designed to identify opportunity areas at the employee level. Once this is identified, managers should be reviewing key areas daily and weekly to begin driving the performance inefficiencies towards benchmark performance.

7- Provide your executive staff with the education, through a reputable and verifiable organization, to attain all benchmarks.

This training is necessary to understand what key activities drive both performance results and customer responsiveness. In addition, you must understand that many benchmarks are driven by the same activities at the employee level. Therefore, successful companies focus on these key areas and build processes to drive these activities to ensure benchmark performance is achieved. For example, many managers in service focus on gross call, net calls, call backs, incompletes, accountable time, FCE (first call effectiveness), repair time, travel time, etc. As you read these lists of benchmarks, the task of trying to meet all of them can be very overwhelming to a manager. We believe that there are 3 benchmarks in service that drive all of the other service benchmarks. Therefore, if you know what drives these 3 key benchmark areas you can build processes and procedures to ensure the desired results. If you can accomplish this difficult task, then you are well ahead of the game.

Execution Effectiveness:

It’s not hard to understand why execution is where 95% of all companies fail in terms of achieving benchmark performance or greater. Being pulled in different directions in order to keep up with the day to day activities required to run the business, knowing what service reporting data to review and the frequency, not building processes and follow-up procedures to ensure critical results are achieved, are the primary reasons a manager fails in executing the key measurable benchmarks.

Below are some key questions you should answer in your efforts to achieve benchmark performance.

1- What are the key benchmarks that I can focus on that will have the most positive impact on my business and my customers?

2- How can I measure these key benchmarks to the industry definitions?

(This is critical. Over seventy percent of the companies we visit are measuring themselves incorrectly to benchmark parameters. There are a variety of reasons for this. However, one of the primary reasons involves not understanding how to setup their ERP correctly. As a result of this challenge, the Pros Elite Group worked with Digital Gateway/ECi in order to build the Pros Elite custom reporting package. This custom reporting package provides a company with the ability to measure their service performance operationally and financially to the model. This capability is very critical in order to measure your results accurately).

3- What are the key employee activities that drive the results of the key benchmarks that you are focusing on improving?

4- What are the key follow-ups processes and procedures that need to be consistently executed to ensure the desired performance results and employee activities are achieved?

5- What is the frequency needed to evaluate our performance results in order to ensure we make any course corrections needed for continuous improvement?

It is good to remember the old question: “how do you eat an elephant”? The answer, “one bite at a time”! There is a lot of truth to this saying. You have to take all of the company benchmarks and reduce them into key, bite size pieces that you can successfully execute within the current demands of your day to day business responsibilities.
This is a critical in order to drive positive and effective change within your organization.

About the Author: Jeff Kelly

About the Author: Jerry Newberry

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