Benchmarking Can Help You Build A Better Business
By Karen D. Nutter
Recently, I was on a call with some local business owners who have made it through the “COVID crash” and are now expanding their teams. While the talent market is brimming with eager job-seekers, many business leaders are taking a harder look at their bottom line and recognizing the increased importance of avoiding a bad hire/placement that results in under-performance, role confusion, or future turnover. The need to focus on finding people who truly match the hard and soft skills the job requires is no longer a “hope-to”, it’s a “must-do.” But, the question most hiring managers ask is, “How do I know what the job truly needs?”
In the past, when filling a position in the company, many owners or hiring managers would most likely do one (or all) of the following:
- Find people who are just like their top performers
- Hire people who have worked that same job before
- Give the job (promotion) to someone who has worked there a long time
- Select people who are just like themselves=
Today, if you want to place the right person in the right position, one of the best ways to start the hiring process is with benchmarking. Benchmarking tells you:
- The behaviors needed for the job
- The motivators the job rewards
- The competencies required to perform at a superior level
Benchmarking Produces Results
A commercial specialty contractor had grown to over 100 employees and started recognizing there were talent gaps in management and the strategic leadership role. By benchmarking the CEO role and fifteen management positions, the company has been able to become one of the major players in the marketplace within a five-year period. Additionally, their revenue has doubled, profit has more than doubled, and the company has seen increased productivity levels as a result of putting the right people in the right places.
As an added benefit, the members of the management team who completed the assessments through the benchmarking process came out with a better understanding of their behavioral makeup, as well as the “why” behind their decision-making and how they interact with fellow colleagues.
The Unbiased Benchmarking Process
While typical benchmarking has been scrutinized for incorporating bias, professional benchmarking clearly defines the knowledge, behavior, intrinsic passions, and personal skills needed to do the job.
This is accomplished through a strategic process:
- Identify the position(s) that need benchmarking. These are often those with high turnover, low productivity, or management difficulties.
- Identify the key subject matter experts (SMEs). Up to 10 subject matter experts are selected. They include people who interact with the position being benchmarked on a daily or weekly basis and often include the direct manager, the manager’s direct supervisor, people who are performing well in the position or have recently, and people in lateral positions.
- Identify key accountabilities. Subject matter experts establish three to five key accountabilities that express a detailed description of why the job exists and how the job should be done.
- Prioritize key accountabilities and determine time commitment. After key accountabilities are established, the SME group prioritizes them in order of importance to the success on the job and then assigns an approximate percentage of the workweek to be spent on each.
- SMEs respond to the job assessment. Each SME completes an online job assessment, keeping the key accountabilities in mind. All assessments are combined to create a Job Benchmark Report, detailing the requirements of the position for superior performance based on behavioral factors, motivators, and personal skills.
- SMEs review report results. It’s important that all subject matter experts agree on the final Master Job Benchmark Report as the scales developed are what will be consistently used in hiring for the position.
- Complete the Ideal Candidate Form. The hiring manager and everyone involved in the hiring process reviews the Ideal Candidate Form to document additional job details (such as education and experience requirements, screening questions, background screening, and compensation) before the selection process begins.
A Documented System
Every company needs a selection system that all hiring managers can follow and that provides documented evidence that the people hired using the system are above average or superior performers. By adhering to an established, job benchmarking process, you will have detailed information to support your selection criteria, ensuring evidence to defend any EEOC challenge.
Benchmarking Across The Organization
Although many people only think of benchmarking for C-level positions, entry-level jobs often have high turnover which costs companies a great deal of money. When looking at ROI, benchmarking not only helps you identify the best candidates, it also saves you time and money by hiring the right people the first time and reducing the learning curve with new employees who are strategically matched to fit your company.
The Bottom Line – Build A Better Business
Your business is only as extraordinary as your people, so taking the steps necessary to fill job openings with people who have the right combination of behaviors, skills, and motivation to do the job and fit in with your culture is crucial to organizational success. When you truly know what the job requires beyond basic skills and experience, you can find the right people to build an engaged, productive, and successful team.
Contact us to learn more about how benchmarking can help your business.