Benchmarking is a valuable Loss Prevention tool. Related to Chasing Your Tail – looking for your worst offenders across any metric – benchmarking strives to bring all your locations, employees (or whatever else you may be measuring) up to the level of your top performers – your benchmark.

Benchmarking is a method used to develop a standard to measure performance against. Based on the key metrics or KPIs which you use to determine how well your business is running, breaking down any of these given metrics by location or employee to tease out your leaders and who are your laggards. Then, extending beyond measurement, looking to the leaders who make up the benchmark, study them, learn their qualities that make them the crème de la crème and try to emulate those qualities in the under-performing locations and employees. Finally, on an on-going basis, re-measure to gauge improvements.

To effectively benchmark your locations or employees, you need to:

• Know which metrics you wish to benchmark on
  • These metrics need to be measurable and will likely need to be normalized
  • They also need to be in-line with your company values

• Know how many locations to include in the benchmark
  • Ranking your locations on a metric – include the top 5-10% of locations or employees
  • Compute the mean or average across the top locations and employees on the given metric – this will give you your Standard which you will want to strive to achieve with your other locations and employees

• Study your top locations and employees, the leaders, and study your the laggards
  • Use video to observe operations. What are the qualities of your leaders that you want your laggards to emulate?
  • Develop a plan – changes to implement amongst your laggards – and execute

• Follow-up
  • After having implemented changes, re-perform the measurement against the benchmark. How are your laggards doing? Have they improved?

At the end of the day, benchmarking is about being introspective and striving for more with an attainable goal.