Mindful Measurement: Benchmarking in Public Procurement

Original article published on Linkedin by Dustin Lanier, CPPO

There is a quote attributed to quality guru Peter Drucker “What gets measured, gets managed.” The complete quote, however, is more mindful: “What gets measured, gets managed - even when it’s pointless to measure and manage it, and even if it harms the purpose of the organization to do so.”

So, benchmarking is indeed a double-edged sword, to be wielded with care.

 To do benchmarking well requires a combination of factors:

-        A knowledge of guiding principles and an understanding of what measures would represent an accurate representation of excellence.

-        Data that is available to show organizational improvements, and also can show the contributions of individuals towards these goals

-        Thoughtful insight into what to measure (and what not to measure) and discipline to roll out only those measures that directly contribute to guiding principles.

When we support performance measure projects, we identify measures that directly influence these principles I described in the podcast last week. We review with clients what measures can be supported by data, and then emphasize a small handful that can be tracked for the progress of the organization, and can also allow individuals to understand their contribution to the measures.

Very often these projects create a demand for direct comparisons – How many RFP’s do others do per procurement specialist? How many agents should I have per million dollars of spend? How much savings should we be delivering? How long should a vendor certification process take?

There is a strong demand for both more access to benchmark data and the ability to interpret that data given the realities of the client. Procurement officers want to improve decision-making, strategic capacity and priority setting, and the ability to track and improve performance over time.

We are excited to be working with The Hackett Group on a partnership to promote access to their vast repository of benchmarking data, and to contribute our public procurement lens to make it as applicable as possible.

The Hackett Group understands the immense value of benchmarking and has been at the forefront of providing best practices benchmarking services for clients across the globe.  Their vast and diverse database draws on the results of more than 25,000 benchmarking engagements with nearly 8,800 public and private sector participants worldwide.

Chris Sawchuk, Global Procurement Advisory Leader of The Hackett Group and I discussed on a recent LinkedinLive about their wealth of knowledge on the topic and the opportunities for public procurement.  The full podcast can be enjoyed here!