- 17
- JUL
- 2010
Procurement failing to set the benchmark
Author: Ian George - Categories: Best Practice & Benchmarking
Back in 2008 research by the Procurement Leaders Network revealed that as many as 95% of CPOs would welcome an independent benchmarking tool – a staggeringly high figure which illustrates not only the importance of benchmarking as a means of measuring and delivering results, but also the frustration that exists in the wider procurement community.
A cursory check on Google reveals that the subject is referenced on over three million websites, meaning that there’s hardly a lack of information out there should procurement choose to digest it.
However, the common consensus is that, despite the manifest strides taken by procurement in recent years in the majority of areas, benchmarking is, by and large, something that the industry is still struggling to come to terms with.
A lack of a coherent, and independent benchmarking tool is obviously one reason for this, but there are others, most notably the almost incessant focus on outcomes. And while the findings of many benchmarking studies often create some headline grabbing figures, the major questions – ones that can really help make a difference – are often left unanswered.
A leading figure in this field, recently described the situation to me as thus: “It’s all about making a distinction between what’s interesting and what’s useful. Just presenting the result is interesting, but it’s not particularly useful. Understanding the context and how they ultimately achieved the results is what makes it useful.”
That kind of approach is unlikely to generate too much newsworthy material but it's certainly more likely to be of long-term use to the wider procurement community.
As it is, a major danger in the kind of benchmarking we’re currently seeing, is that those involved in studies of these kinds often report their ‘best examples’ – examples which serve to reflect the exception, as opposed to the rule. This, in itself, can create its own dangers, because the benchmarking is encouraging people to believe that this exception is the rule, when that clearly isn’t the case.
Fundamentally, benchmarking is about improving performance, and improving behaviours and processes – and to do this procurement needs to understand the issues, and the tools and techniques, that that can make this happen.
In short, benchmarking should be about learning but what we’re currently seeing in procurement is that it's less about education and more about target setting.
And that is unlikely to get procurement where it needs and wants to be.
