There are two clear camps when it comes to external benchmarking: the fervent disciples and the dismissive naysayers. The proponents of the practice like Warren Buffett and Mark Cuban argue that it’s crucial to know your competition in order to better know yourself and your industry. A handful of others out there will argue that benchmarking is flawed and can’t possibly provide useful data in complex industries. So which side of the fence are you on?
Some of you might be passively reserved about using external benchmarks, and it’s not uncommon. A lot of questions swirl around whether or not it’s worth the effort. Most of the holdups cited by businesses tend to be misconceptions, and they shouldn’t keep you from the wonderful world of benchmarking. The bulk of them go something like this:
“My business is unique. I don’t need to copy others.”
An inward-looking mindset seems to be the most popular and unfortunate reason for backing out of benchmarks. We all have a tendency to think we’re special and different, but in reality, we all have similar goals and experience similar problems. It’s not about copying, it’s about comparing.
A benchmark isn’t the equivalent of peeking at someone’s answer on a test and writing down whatever you see. It’s more like seeing the grade reports afterward as well as how each student prepared for the test. If one student keeps getting an A+ and is doing something you’ve never thought to try, wouldn’t you want to know about it? It certainly wouldn’t hurt.
Let’s stick with the school analogy. If you’re not looking at others’ grades, you might think you’re doing the best you can, and the class (your industry) is just a really difficult one. If you carry on doing your own thing and accepting your grade without looking at the class average, you’ll never know the potential to do better.
I’d venture a guess that the class average isn’t good enough for you anyway. If you want to be at the top, you need to know what you’re up against. Nobody is competing in an industry of one, so if you’re satisfied with just looking inward, you might want to reconsider.
Our Upcoming Benchmark
If you haven’t heard yet, listen up! We at Listen360 are working on an exciting benchmark report that includes industry standard Net Promoter Scores and best practices. You’re going to want to get your hands on this one. Stay tuned or contact us for more information.