On this page
- Measure your business performance
- Compare your business to competitors
- Identify areas that need improvement
Measuring your performance
Benchmarking involves measuring the performance of your business against a competitor in the same market. Comparing your business to others is a valuable way of improving your understanding of your business performance and potential.
Benchmarking your business will give you insight into how well each aspect of your business is performing, allowing you to discover which areas you need improvements, and help you develop a plan towards achieving those improvements.
Benchmarking at its best is used as a tool to help your business evaluate opportunities for improvement. There are many benefits of benchmarking, the top reasons include:
- identify and prioritise specific areas of opportunity
- understand your customers needs better
- identifying your strengths and weaknesses
- set goals and performance expectations
- monitor your performance and effectively manage change
- understand your competitors to become more competitive.
Six steps to successful benchmarking
Use these steps to practically benchmark your business against your competitors:
1. Identify what you're going to benchmark
Start with targeted and specific questions. The questions should be specific, capable of being explored using qualitative or quantitative research efforts and in line with your business strategy. If you haven't already, it is a good idea to do market research.
2. Identify your competitors
Write down a list of who your competitors are. Most businesses benchmark within the same industry. Identify effective tactics used by your competitors, and areas in which their business is performing better and note these down.
3. Look at trends
Look at recent statistics to analyse any current trends for insight into how fast your industry is moving and how you can plan ahead to keep your business in tune with customers' needs.
4. Outline objectives
After the results of the analysis have been interpreted and communicated to the appropriate people, goals should be established. These should be concrete, attainable and in line with your corporate strategy. Make sure you list all your goals in your marketing plan.
5. Develop an action plan for your objectives
Define specific, concrete actions to be taken. They should detail the tasks involved and include specific names and dates associated with each task.
6. Monitor your results and implement an action plan
Continuously monitor the results of the benchmarking efforts and ensure that the action plans are consistently applied. Use our one page action plan template for help with this.