What is benchmarking?

Benchmarking is the process of comparing an organisation’s performance against the performance of itself or others. It can provide helpful context to your performance and therefore provide insight into understanding the strengths and weaknesses of your organisation and action plans.

What types of benchmarking are there?  

Internal benchmarking

Internal benchmarking is focused on improving your organisation by comparing against historic data or different areas of your organisation. Whether you're comparing departments or different locations, you can use internal benchmarking to uncover the best, most efficient practices and share them across the organisation. They can be used to set internal targets, e.g. a company standard eNPS score.

External benchmarking

External benchmarking provides wider context to your organisation’s performance. It allows you to see how your performance compares to other organisations. This could be based on organisations from outside or inside the same industry, both of which are valuable. 

What are the benefits of benchmarking?

• Organisations can measure themselves against internal or external standards.
• Identification of best practice.
• Provide the catalyst for change or innovation.
• Spot trends and patterns that organisations may not have been aware of.
• Intelligent use of benchmarking can lead to:
• Enhanced employee Engagement and Happiness
• Improved customer satisfaction
• Greater efficiency, e.g. increased productivity and reduced costs
• Increased revenue and profit

What should you consider when using benchmarking? 

Whilst benchmarking can deliver powerful insights, that’s only the case if you can avoid the key pitfalls of benchmarking.

First up is that external benchmarking lacks context. It shows what’s happened, but not how it was achieved. It's important to note that benchmarks are focused on the past and are no indicator of what is going to happen in the future.

No two organisations are the same. Every organisation has a set of unique circumstances. For example, an organisation experiencing a growth phase will have a very different set of circumstances compared to an organisation in a consolidation phase.

Often organisations can review benchmarking data and focus on something that is outside of their control. This results in them spending time and effort in areas where they are unable to drive positive change.

Finally, organisations can become obsessed with benchmark comparisons and it’s important organisations don’t. If the benchmark is poor and an organisation slightly outperforms this is not a time for the board to celebrate. Likewise, if an organisation’s performance is way below the benchmark it doesn’t mean the organisation needs a radical overhaul, but it can be the catalyst for positive changes.

What do we benchmark at The Happiness Index?  

Cultural Assessment 

• Overall Cultural Assessment score
• Overall Happiness score
• Overall Engagement score
• Question level benchmarks
• Neuroscience theme benchmarks

Exit Pre-Built Survey

• Overall survey level scores
• Question level scores

Employee Voice

• Overall Employee Voice score

eNPS

• Overall eNPS score

Please note we will be introducing benchmarking into our other Pre-Built Surveys once they reach a statistically relevant number of responses.

How do we benchmark?

All surveys are scored on a scale of 1-10, where 1 represents the lowest score, and 10 represents the highest. All questions are weighted equally. All aggregated results are calculated using the mean average of the related question.

For eNPS the benchmark is generated by taking each individual score and assigning it to the Detractors, Passives or Promoters groups. The eNPS is then calculated by subtracting the % of Detractors from the % of Promoters.

Our benchmarks are generated using anonymised participant data and where there is a statistically relevant number of responses we breakdown the benchmarks by sector, company size and location.

Benchmarking in the Platform

We offer in-platform benchmarking for some Pre-Built Surveys. The Cultural Assessment allows you to benchmark your Happiness and Engagement results, as well as your Neuroscience results.

We also have benchmarks available for two key questions which feature within our Pre-Built surveys. The first is a key happiness based question which allows us to identify key happiness drivers within your insights. This question is 'How happy are you at work?' and the other is an important question related to employee advocacy and that question is Employee Net Promoter Score. We provide Sector and Company Size benchmarks for both of these questions (results are included in your custom board report).

Here are some screenshots of the in-platform benchmarking which shows survey wide benchmarks as well as at a question level:

For us, every organisation is unique and that’s why benchmarks should focus both on external competitors as well as internal trends and factors. In addition to external benchmarking, we use internal benchmarking and our proprietary cross-theme analysis to help you understand your key engagement AND happiness drivers across all your surveys in real time.