Hunting for "Best
lot is written about benchmarking as a vehicle for
identifying best practices. Clearly the two are related, but
sometimes too much weight is given to the connection.
The temptation is to look to high performing companies, make
a laundry list of what they are doing, and then go try to
emulate that. The presumption being that most of what they
are doing qualifies as "best practice." In reality, what is
often taking place at leading companies is a mix of three
1. Basic or core operating practices ("blocking and
tackling") that are simply executed at a level better than
2. An effective "operating model" within which these
3. True "best practices," of the innovative and breakthrough
The first two categories are clearly important, and in some
cases more important than the latter, because without those
foundational aspects, all the best practices in the world
will yield little incremental value. But assuming those are
in place, true "best practices" are clearly the next place
to look for innovation. The challenge is knowing what to
When you invest in activities geared toward identifying
these types of best practices (conferences, benchmarking
studies, consulting projects, etc.), it's important to have
a set of standards on which to base your return on that
investment. For a best practice to pass the "innovation"
test, it must deliver some level of insight that goes beyond
just doing the same things better. I offer the following as
a checklist for assessing whether a specific practice passes
this type of sniff test:
1. Is it definable?
Best practices are not general philosophies (e.g., "better
management of risk"), but rather specific changes to
process, technology, organization, policy, or operating
protocol. And it refers to a specific "change" from current
state, typically involving something you will either add
(start doing) or subtract (stop doing) . Sometimes it's a
new process or technology all together. But defining it
requires being specific.
2. Is it unique?
Is this a practice you are likely to find most everywhere
you go, just implemented at different levels of
effectiveness? There is nothing wrong with focusing on
better execution/implementation of core business practices
as a driver of performance, but you are better off calling
it what it is – an implementation breakdown – rather than
disguising the issue as failure to have a particular
practice or policy that the organization knows is already in
place in some way, shape or form. Otherwise, you'll be met
with "this is just more of the same."
3. Is it breakthrough?
Does the change in practice or policy create a step level
change in result of a business process? Generally I look for
a 10 times payback in a relatively short horizon, and at
least a 50% change in current performance level to the
affected business process. But these standards can vary from
company to company. But we are not talking 1 or 2% – but
something of material significance. A small standard
business case worksheet can help your employees do their own
internal "sniff test" before consuming your time in
analyzing the myriad of small ticket changes.
4. Leading edge or "bleeding edge"?
Often, it is our temptation to look at the coolest
technology or system and proclaim it to be a best practice.
Most of these are untested at best, and looking for "test
dummies" to try themselves out on. Find companies that have
implemented it, look at the business cases they used to
justify it, and then look at how much of that actually
5. Is it actionable?
My test for "actionable" is usually that it can be adopted
(fully implemented) inside of a 1-3 year timeframe.
Otherwise, you're adding new R&D into the pipeline. R&D is
fine, but don't let theoretical or speculative projects
clutter up your best practices pipeline. Focus on things
that you can quickly assign ownership to, and things you can
get on with rather quickly.
6. Can I attach value?
Most importantly, can you attach dollars and a specific
budget location to the achievement of implementation? And
will someone "sign up" for that commitment? E.g., if I
implement xyz, how many bodies go away, or how much money
will I save, and when? If you can't answer those questions,
we're probably not talking about a credible "best practice."
Look, there is nothing wrong with focusing on doing the
basics better. Or having a better operating philosophy or
business model. You need those elements to run the business.
But when we talk about BEST practices, we are generally
talking about doing something unique and different. And
without that component to business improvement, it's
unlikely that you will get to or remain at a leading edge
level of performance.
So make sure you have true best practices in your pipeline,
and use these tests to make sure they pass the proverbial
Bob Champagne - UMS Group, Inc., a privately held
international management consulting organization specializing in
Performance Management tools, systems, and solutions.
Included in UMS Group's product portfolio are a wide variety
of performance tracking, reporting, and benchmarking
solutions, as well as customized performance assessments and
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