Beyond Benchmarking: From Imitation to Innovation
By Matthew Cross
President, Leadership Alliance

You know there are things in your business you can improve. You also know that you need to continuously improve in order to stay competitive and grow, if for no other reason than to stay ahead in your market. And, you know that many others have been right where you are and have found better ways to handle many of the same challenges you face. What to do? How can you gain and/or maintain the lead in offering high quality services and products that delight your customers and grow your bottom line?

One approach that has gained much popularity is called “Benchmarking.” Benchmarking is simply defined as going out and finding others in your field - allies or competitors - who are doing it better, from a specific process or service to the whole business. You then adapt their solutions into your business. Essentially, benchmarking is copying what another business has discovered works for them, and then importing it into your business. For instance, you identify the top five critical processes in your business and then “benchmark” them - compare your current performance levels in those same areas against another business’ more ideal levels of performance - and then strive to “meet or beat” that level. This practice has become quite popular with many businesses looking for a “quick fix” to the most pressing issues regarding the quality of the products and/or services they offer.

On the surface, this often sounds like a great idea. Why reinvent the wheel, right? Why not profit from another organization’s trial and error and take the easy road to improvement? Indeed, benchmarking has proven to be a valuable catalyst for improvement in many organizations, and can often be a stepping-stone to better operations. Yet imitation is not the optimal way to build your bottom line nor assure future growth. There is a better way to greater success, beyond benchmarking: Innovation. Innovation means to come up with your own customized answers to your specific challenges. It means to tap into your own people’s innate wisdom and come up with uniquely powerful solutions that custom-fit your business. Innovation has several powerful advantages over benchmarking. These include:

1. Innovation fosters breakthrough, “out of the box” solutions; Benchmarking merely
fosters imitation.

2. Innovation focuses on creating improvements that are customized for your business;
Benchmarking only imports solutions customized for someone else’s business.

3. Innovation requires that you understand the whole system that leads to best long-term improvements; Benchmarking primarily focuses on getting “quick fix” results, which often compromises long term performance.

4. Innovation focuses on going as far as you can go and beyond; Benchmarking only focuses on going as far as someone else has gone.

A good place to start any innovation process is to make a list of the most critical processes and customer interaction points in your business. Describe briefly the current less-than-optimal situations, and then ask for each one: What would perfect look like? Write down a short yet detailed description of what perfect would be. Depending on the size of your business, you might simply start by just asking yourself this series of questions, and brainstorming your answers on paper. You would then want to invite the other key players on your team to contribute their ideas. This greatly increases your “data pool” and also strengthens your team, when it is done in an atmosphere free of fear and internal competition.

Since every journey begins with the first steps, here are some key points on getting started on your own innovation process:

Define Your Targets: Clarify the best innovation targets as they would apply to you and your business - not whatever levels your competition has reached, or what is deemed “successful” in your industry. The key is to start small. Single out the top three areas in your business that are obviously ripe for improvement, and begin.

Remember Why You’re in Business. Why are you in business? What is your aim? According to quality legend Dr. W. Edwards Deming, all businesses are really only in one business (if they want to grow and prosper): Creating loyal customers. Merely “satisfying” customers is no longer enough – four out of five “satisfied” customers will defect, if offered the right opportunity. Building customer, employee, and investor loyalty is proven to be the best investment strategy any business can make to assure it’s future. Do you have a clear strategy in place to create and keep loyal customers?

Commitment. You must commit to continuous innovation in your business. This is a vital ingredient in any endeavor to grow and improve.

Self-Education. Learn as much as you can about the power of true quality management, systems improvement, and strategic innovation. These critical optimization methods are very powerful allies, even when applied in small steps. Perhaps best of all, they offer a synergistic, cumulative effect on your whole business. This directly impacts your bottom line results – and future success.

Critically Assess Your Whole Business System. This requires both courage and honesty, and should ideally involve everyone in your business. Where do you drop the ball? Where do you experience the greatest frustrations and waste? Where do your customers experience the most problems doing business with you? While sometimes painful, the answers to questions like these often reveal the biggest opportunities for innovation and improvement.

Consider an Innovation Coach. A qualified, objective coach can offer valuable insights
and guidance on your innovation journey. It is usually difficult to work on improving your business systems when you are working in them. A good coach can greatly increase the velocity and value of innovation efforts.

Focus On The System; The Sales Will Follow. Your business system holds the key to your success, not focusing obsessively on hitting sales targets. “Navigating your business by past financial performance is like driving a car by looking in the rearview mirror” (Dr. Deming). The key here is to continuously focus on improving your critical systems, especially the “First 15%.” According to Deming, 85% of the results you will get lie in the first 15% of any process. This means that the seeds for success are in the front end, not the back end. Sales are results, not drivers. When we identify and take care of the first 15%, growth and higher sales are the natural result.

Step Outside Your Box. Consider this powerful question regarding any seemingly insurmountable challenge: How would this look/function if it was perfect? Let your imagination soar here. Write down the first things that come to mind; the answers often come when we step outside our “box.”

Regarding any innovation efforts, the key is not to focus exclusively on the desired goal or results. Get focused instead on discovering and applying the best theories and methods, and the desired results will follow. Having an ideal target is important, but it is not enough alone to best assure your success. A continuously improving system combined with a clear aim is the key to hitting and exceeding any of your desired targets.

Strategic innovation is a proven “power tool” for success. For optimal results, it is best part of an integrated approach aimed at bringing out the best in your people, processes, and performance.

Summary:
Benchmarking is the process of scanning your industry and finding “best practice” examples which you can then import into your business. Essentially, it is imitating or copying another’s solutions. While it can be a valuable learning process, there is a far better way - Innovation.

Innovation is the process of discovering the best solutions for your own unique business and customers, implementing those solutions, and then tracking and continuously improving on them with internal (your team) and external (your customers and vendors) feedback. Innovation very often leads to strategic breakthroughs in your business – breakthroughs that can be easily missed when we focus on copying the methods developed by others for their unique organization. Innovation also invariably leads to a greater understanding of your customer, and ultimately, to greater success.

So, the next time you are tempted to benchmark someone else’s example or success, remember to keep these words foremost in mind: INNOVATE – DON’T IMITATE.

Matthew Cross is President of LeadershipAlliance, an innovative consulting organization dedicated to personal and professional transformation. A noted expert in the Deming Quality Method, his trainings lead companies and individuals of all types to reach and exceed their highest potentials. For more information, contact Matthew at LeadershipAlliance at: MCross@LeadershipAlliance.com or call: (203)-322-1456.