Shared Services - Benchmarking and Measurement

Benchmarking and Measurement

In establishing and running a shared service, benchmarking and measurement is considered by some as a necessity. Benchmarking is the comparison of the service provision usually against best in class. The measurement occurs by using agreed key performance indicators (KPIs). Although the amount of KPIs chosen differs greatly it is generally accepted that fewer than 10 carefully chosen KPIs will deliver the best results.

Organizations do attempt to define benchmarks for processes and business operations.

Benchmarking can be used to achieve different goals including:
1. To drive performance improvements using benchmarks as a means for setting performance targets that are met either through incremental performance improvements or transformational change.
- Strategic: with a focus on a long term horizon; and
- Tactical: with a focus on the short and medium term

2. To focus an organization on becoming world class with processes that deliver the highest levels of performance that are better than those of its peer group.