Benchmarking for Continuous Improvement

By Lori Gray
Risk Management Division Chief
Prince William County, Va.

In many organizations, benchmarking is used to measure the performance of the safety and risk management programs to compare the results of one organization with another. The results are then indicators of what is functioning efficiently and what areas need improvement. Additionally, organizations often use these metrics for justification in requests for budgets such as for staff increases, new safety programs to further minimize loss, and for overall program maximization.

Prince William County’s Office of Risk Management has been working on benchmarking for the last five years and has been working to revise the performance measurements that are currently utilized in the budget process to compare its performance against itself every fiscal year. Additionally, Prince William County has an annual report that benchmarks various departments within the organization with four other local governments of like kind. Three of the local governments remain the same and the fourth can be chosen by the manager. This report “Service Efforts and Accomplishments” (SEA) is distributed to the Board of County Supervisors and the citizens to show government accountability and to illustrate how much is spent on government services; it also shows how well those services are performed. This report is also used to review results and initiate change when necessary. The 2005 report will be the first year that Risk Management has been incorporated into the SEA process.

In these benchmarking efforts, it has been extremely challenging to locate jurisdictions that collect the same data that are of the same like kind. For example, one jurisdiction may be fully insured, one may have high retentions, and one may be in a pool. Depending on what data you are trying to capture and benchmark, it is essential to know who you’re comparing yourself against. Furthermore, this is necessary in understanding your exposures. One jurisdiction may include parks, where another may not. Parks have different exposures that may inflate the outcomes.

It has been extremely difficult to find other jurisdictions that track the same data as we do for comparisons. For example, in order to determine Accidents per 100,000 employee miles, jurisdictions must track the vehicle mileage. For the lost workday rate per 100 employees, jurisdictions must have the employee hours worked and have the same definition for those hours, such as full time and part time. Also, they must capture the lost workdays for that given year.

Finally, one of the most difficult aspects of benchmarking is the time it takes to fill out the benchmarking surveys that are requested. Many organizations are now conducting some type of benchmarking survey to analyze, justify, or modify their programs. Due to these surveys, many managers do not have the time to respond to all the requests. Also, the benchmarking results are only as accurate as the data that is provided and making sure each question is clearly defined and explained is imperative so that all comparisons are with the same like kind jurisdiction/program.

Benchmarking is extremely beneficial to organizations when the activities are measurable, are measured against the same data from other organizations, and provide some framework for analysis so improvements can be made. The development of standardized measures which are tracked by an outside source would enable organizations to utilize and compare the data and that are currently benchmarking. This will not be useful until the data that is being captured is clearly defined and then tracked/captured by each participant.