Benchmarking "do's" and "don'ts"

How can companies get the greatest benefits from benchmarking and best practices in their supply chains?

That question was put to a gathering of 60 top supply chain executives at the Supply Chain Leadership Forum, an event hosted by the Supply Chain Consortium and the consulting firm Tompkins Associates, which manages the benchmarking organization. The two-day seminar drew participants from retail, consumer product, and distributor/ wholesaler companies.

To answer that question, attendees came up with a list of "Do's" and "Don'ts" for companies that want to benchmark their supply chains and adopt best practices. (See their "Top 5" list below.)

The executives noted that benchmarking and best practices have helped them to improve supply chain performance, especially when it came to costs. Some 74 percent said that benchmarking had a positive effect on transportation costs while 70 percent said that it did the same for distribution costs. Another 56 percent said benchmarking had improved their customer service levels.

Top 5 benchmarking do's and don'ts
• Do align with key stakeholders
• Do succinctly summarize benefits for top management
• Do reduce your scope to actionable items
• Do maintain perspective of both your business and cultural model
• Do test multiple options before drawing conclusions

• Don't use competitors that match up poorly with your supply chain processes
• Don't ignore your competition
• Don't benchmark too broadly; keep a narrow focus
• Don't use benchmarking and data-analysis tools without understanding how they work
• Don't work in a vacuum and think your organization knows it all