The Importance of Benchmarking to Discover Needs | Sales Management Training
Top companies compare themselves to leaders not just in their industries, but in any process they are interested in. For instance, a company might benchmark its customer service against Nordstrom, even though it’s not a department store.
Same-industry benchmarking gives you an idea of the standards you are competing with in your type of business. Process-oriented benchmarking against other industries gives you a standard for what is possible, plus fresh ideas.
A Benchmarking Tool for Prospects and Clients
One of the most helpful tools you can use to help prospects develop and define their needs is a benchmarking tool. A bench- marking tool allows you to compare information about your prospect against standards. When your prospect’s data vary from the standard, this provides you an opportunity for creating a dialog around the issue.
Which benchmarking tool is the right tool for you? One of the leading benchmarking sources is a Robert Morris Associates (RMA) book that gives industry averages for things like sales per square foot, average gross, average profit margins, and so on. Many banks use the RMA data for comparison purposes when making decisions about loans. The comparisons quickly high- light how businesses are doing or when projections are unrealistic.
Some professional firms have developed their own benchmarking data because they have many clients in a particular industry. For example, PricewaterhouseCoopers has developed a benchmarking tool they call advanced middle market business intelligence tool—or AMMBIT. This PwC tool was developed from business data input by many CPAs from many firms.
Sageworks has an industry comparison program that captures data from a variety of sources. The unique aspect of the Sageworks program is that it provides a written analysis of the benchmarked data for you to provide your client.
Develop Your Own Benchmarking Tool
You could devise a custom tool that applied across industries for your clients. It could be as simple as a checklist asking if they had a business succession plan, a will, audited financials, a disaster contingency plan, adequate financial reserves, a line of credit, or other areas in which you specialize. It could also go into more depth in one area.
Conclusion
The best benchmarking tools give an “objective” picture of how a business compares to others. It could also use customer perceptions or wants as standards. For instance, clients tell us that they judge accountants, attorneys, and other professionals by how well they are treated in little interactions. They are more impressed by how fast their calls are returned than by professional certifications and similar measures of technical competence. Yet most firms don’t have standards for returning phone calls or keeping in touch with clients when not doing work for them.
