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Management Services Spring 2012
What can an economic benchmark teach us about benchmarking?
By Professor John Seddon. P
ortsmouth City’s housing repairs service achieved an economic benchmark; it (with its suppliers) was the fi rst to develop a repairs service that gives tenants repairs on the day – and at the time the tenants want – and this new service operates at half of the cost of the old service. Jaw-dropping, extraordinary and, as I often say, if BT could learn to do that, we’d all cheer.
But when Portsmouth received a visit from the Audit Commission in the latter’s dying days, the inspectors downgraded their rating of Portsmouth’s service. Portsmouth’s leaders were unable and unwilling to show the inspector the things he/she wanted to see, one of which was active involvement in benchmarking.
Belief in benchmarking How on earth could Portsmouth have achieved what it did by comparing itself to, and visiting, others? A question that didn’t even register with Audit Commission inspectors: they were just doing their job, ticking or not ticking boxes. But it is an obvious truth: you will never out-innovate others by copying them. Why do we believe in benchmarking?
The protagonists of
benchmarking, avoiding that obvious truth, will argue that others should visit Portsmouth now, to learn from the service. So let’s see what that might reveal. If you go to Portsmouth, as I have done, you’d probably start where the customer rings in for a repair, at one of the suppliers. You might have a concern that letting the supplier take the call is not the same as taking the call yourself and then instructing the supplier. After all, you want to control your suppliers, don’t you? The fi rst thing you would see is tenants calling in and being asked when and on what day they’d like their repair done. If you are a conventional repairs manager, for that matter a conventional management thinker, you would think this is going to be costly. Conventional managers think doing what customers want can only increase costs; they think there is a trade-off between quality of service and cost.
If it occurs to you to ask how they have been able to work this way, the Portsmouth managers (council or suppliers) will tell you that they resource with tradesmen to what they
Benchmarking Benchmarking
Rarely does seeing something change our view of the world, especially when what we are seeing challenges convention
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