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Beware the benchmarks

Tom Wall Published on 27 December 2010

A lot of people say they don’t like to compare themselves to others. But the truth is that they seem to do it anyway. And yes, I’m guessing that includes you.

Ultimately, we all want to believe that we don’t compare ourselves to other people, but for one reason or another, we still do. And to some degree, it seems that many of our purchasing decisions are actually driven by our desire to compare and compete. Whether you make decisions in order to fit in or stand out, a lot of what you buy helps you do one or the other.

So how does that apply to the way you manage your dairy? Does this desire to “measure up” influence or affect the business decisions you make?

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Chances are, you probably use various benchmarks to evaluate your dairy’s performance and results, right?

When using benchmarks, once again we turn to the “industry standard” and compare companies to others that fall within similar parameters. And when it comes to benchmarks, I’d agree this comparison is a pretty reasonable way of keeping your dairy in line with other operations just like it.

But how do you truly view and utilize benchmarks? Do these numbers help you set realistic goals and expectations for your dairy’s team to aspire to? And when you eventually do reach this “target performance level,” what do you do next?

Essentially, the question is this – are your dairy’s benchmarks used as a starting point or a finish line?

Some managers take the approach that benchmarks are meant to define a minimum expectation. Basically, they see benchmarks as the number that locates the minimum level of performance. These managers know that while other dairies will fall below this “line,” they expect to perform above it. For these managers, benchmarks merely act as a floor and set the minimum performance they’re willing to accept. These managers expect to keep setting new “team records” without allowing the industry standard to limit their team’s true potential.

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On the other hand, some managers view benchmarks as a finish line. In other words, once they reach the industry standard, they raise their arms in victory and say “We made it!” Since they see a benchmark as the ceiling, these managers are satisfied with simply achieving the “industry standard level.” Their main goal going forward becomes maintaining this “benchmarked performance level.” In fact, you might even hear these managers defend their new “good enough” industry position by saying that they’re “as good as the benchmark.” And yes, that’s true ... until someone else sets a new standard.

The truth is, managers need to know how their company measures up to the rest of the industry. And comparing your dairy to others can be a good measuring stick to help gauge your operation’s current performance ... just try not to let it rule you! PD

Tom Wall

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