Leaders or followers?

In an article about the adoption of Best Practices, Marketing Guru Michael McLaughlin says it's no wonder that most banks, retailers, airlines and consultancies look the same; they've been busy copying each other's best practices for years!

Adopting so-called best practices is a follower's strategy. An organisation that simply adopts another's practices will never be a leader and is likely not to be innovative, agile or fit for the future.

Why Benchmarking might not work

Benchmarking was always one of the “advanced” continuous improvement tools and was designed to be used where an organisation wanted to achieve a step-change in performance. To get that payback, it was really most applicable in “mission-critical” services and processes, and required significant leadership and investment of resources. Trying to apply Benchmarking (assuming it is done properly) to every process or service is unlikely to be a good use of resources.

But, there are two more reasons why Benchmarking and adoption of best practices might not work.

• Change must come from within
• Best practices don't come with a Manual

In many organisational cultures it's rare for people to respond positively to ideas (best practices) handed down from Head Office, or brought in by consultants, or from competitors. It's far better to create an environment that enables people to generate improvement ideas with a high degree of ownership. The aim is to get “adoption” and to move from “good practice theory” into applied practice and improved performance.

Perhaps the biggest challenge is that “best practices” are actually only “best” in the context of the organisation, culture, processes, people and skills from which they originated. They don't come with a Manual that describes how to implement them or how to achieve superior levels of performance. You may be able to replicate the processes and you may understand the metrics that the “benchmark” organisation uses, but it can be extremely difficult to replicate their capability to achieve a particular level of performance because that is largely due to their people.

Successful Benchmarking

All the organisations that are leaders in Benchmarking (e.g. Yell, Xerox, TNT and other UK/European Quality Award Winners) have their own “process” that they use rigorously to implement Benchmarking Projects. It is part of their embedded approach to continuous improvement and assumes:

• You have a way to select strategically important Benchmarking Projects (and to filter out those that do not justify the level of resource and support)
• The right people are involved in the team and they are given the time to carry it out (and engage their colleagues along the way)
• There is senior management sponsorship: to help see through change and ensure implementation of practices that will deliver performance improvements
• Your Benchmarking Project addresses all three of the following: Metrics, Processes and Organisation (the “what, how and why” of performance)

There are also some practical lessons to learn from others' Benchmarking experience:

• It's unlikely that you'll find best practice in an organisation that just happens to be “down the road” from you
• There is no such thing as an “all-round best practice partner” – no one organisation can possibly be best at everything
• You have to develop an approach to Benchmarking that works for you and is appropriate for your culture
• You're probably not as good as you think you are and there are things you can learn from others
• You must have a balanced set of metrics and understand your own processes (practices) first: otherwise you will either compare “apples with pears”, or focus on cost to the detriment of service and outcomes

Like any management tool, Benchmarking and the adoption of best practices can be of great benefit, especially in the drive for better value and improved service. Used badly, it can be an expensive disaster. Used properly, it enables you to improve performance and achieve step-change.