Benchmarking is the process companies use to identify and establish key performance standards, or benchmarks, and measure their performance against those standards over time. With a benchmark analysis, a company can compare its current scores in critical areas against its own past performance, as well as against its competitors.
Done in-house from the ground up, benchmarking can be a dauntingly complex process. Benchmarks must be agreed upon, measurement tools and strategies implemented, research assigned and completed (which, in some cases, means navigating security and permission concerns), and reports compiled. The information in the final analysis can be invaluable, if the right resources, attention, and talent are invested in it.
What’s more, benchmarking is not a one-time exercise, but a living process that depends on continuing collection and interpretation of current data. The shelf life of a single analysis report is fairly short, but properly maintained, a benchmarking strategy can be a gift that keeps giving.
Where does benchmarking fit into improving the customer experience?
Often used to determine how a company is faring against its peers financially, benchmark analysis also has a qualitative application. This includes measuring the critical metrics of customer service and experience that carry the most weight with overall customer satisfaction – what CSP calls key drivers.
Responses to Voice of the Customer initiatives like surveys can be translated into scores and percentages, which then get used to identify the top, bottom, and average range of responses to those metrics. Comparing the most current available scores against these ranges gives an indication of whether the customer experience is excelling, lagging, or falling behind.
Benchmarking is a way for managers to reality-check their perception of how their strategies and employees are performing against what the customers are actually saying.
Benchmarking provides a competitive advantage
The quality of a business’s customer service is often a make-or-break factor in customer satisfaction, loyalty, and likelihood to promote that company to others. In many ways, customer experience is the marketing that keeps happening even after you’ve initially earned the customer’s business.
Benchmarking not only demonstrates a company’s performance against itself, but against a defined peer group of its competitors, measured by uniform standards. While a direct Company A vs. Company B comparison may not reveal much of use, there is valuable insight in identifying one’s overall standing among the rest of the pack.
For instance, let’s say a manager has grown concerned about how long customers are kept waiting before they speak to a representative. Maybe she has noticed longer lines on the sales floor, or customers looking frustrated or impatient while in line.
Through benchmarking, she has been tracking “wait time” as a key driver for six months, and sees that this month, customers have indeed indicated a drop in satisfaction against this metric. She then reviews the wait time satisfaction scores of her peer competitors and determines that they have seen a slight increase in the same period of time, dropping her company back in the ratings from the “top” to “average” category. Now there is a risk she may start to lose customers to the better-performing competitors.
This intelligence informs the manager of an opportunity to improve the customer experience by implementing new strategies to affect the wait time at her location. Continued benchmarking will help her track progress against that goal, and identify any new opportunities for improvement that may come along.
It doesn’t end with the report
Benchmarking is one step in the process – a critical one, but nonetheless, just one. As with all Voice of the Customer data, its ultimate value depends on how the information is used to improve the customer experience with well-informed training, continued evaluation, and timely reporting.
That’s why CSP’s new Benchmark Analytics Reporting Dashboard pairs so nicely with our training and employee support, such as the STARS library available to our clients, to create a balanced ecosystem of process, performance, and progress. The dashboard takes much of the rigorous research and reporting aspects of benchmarking and delivers an easy-to-read analysis that can tell you, at a glance, where you fall among your peer group.
To learn more about benchmarking, the new dashboard, STARS, or any other component of customer experience management, contact us with your questions.