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Performance Benchmarking (Peeling the Onion)

Performance Benchmarking (Peeling the Onion). Validate/Diagnose/Improve. Presentation to: Municipal Waste Management Association 2004 Fall Summit Thursday, October 21, 2004 Presented By: William H. Schoen Senior Manager Hilton Farnkopf & Hobson, LLC. Presentation Outline.

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Performance Benchmarking (Peeling the Onion)

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  1. Performance Benchmarking(Peeling the Onion) Validate/Diagnose/Improve Presentation to:Municipal Waste Management Association2004 Fall Summit Thursday, October 21, 2004Presented By: William H. SchoenSenior ManagerHilton Farnkopf & Hobson, LLC

  2. Presentation Outline • What is Benchmarking • Why Use Benchmarking • Who Uses Benchmarking • Organizing Benchmarking Efforts • Types of Benchmarking • Validation (Dept. Head) • Diagnostic (Ops. Mgr.) • Case Studies • Novice Benchmarker • Experienced Benchmarker Validate/Diagnose/Improve

  3. What is Benchmarking? A Process Involving Some or All of the Following Steps: • Identifying Operational & Financial Benchmarks • Documenting Current Baselines • Documenting Historical Trends for Benchmarks • Ongoing Tracking of Performance vs. Baselines • Comparing Performance to Industry Standards • Targeting / Prioritizing Areas for Improvement • Identifying Best Management Practices (BMPs) • Incorporating BMPs into Operations • Review/Refine/Repeat Validate/Diagnose/Improve

  4. Why Use Benchmarking? • Validate • Diagnose • Improve Validate/Diagnose/Improve

  5. Who Uses Benchmarking? • Bank of America • Xerox • U.S. Army • NASA • HF&H • Your Colleagues • Your Competition Validate/Diagnose/Improve

  6. Types of Benchmarking • Validation • Dept. Head & Upper Management • Big Picture • “How are we doing?” • Diagnostic • Operations Managers • Fine Print • “Where and How can we improve?” Validate/Diagnose/Improve

  7. Types of Benchmarking Validation Benchmarking • A Snapshot in Time • Provides General Evaluation of Performance vs. Industry Standards • Relatively Easy to Do / First Step of Diagnostic • Answers the Question “How are we doing?” Validate/Diagnose/Improve

  8. Types of Benchmarking Diagnostic Benchmarking • A Moving Picture of Performance • Provides Specific Analysis of Performance • Requires More Detailed Data • Results in Targeted Areas & Specific Priorities for Improvement / Incorporation of BMPs Validate/Diagnose/Improve

  9. Organizing Benchmarking Efforts • Safety • Customer Service • Productivity • Cost Validate/Diagnose/Improve

  10. Validation BenchmarkingHow Are We Doing? • Define Operational Characteristics • Identify Benchmarks (Safety, Customer Service, Productivity, Cost) • Establish Baselines • Evaluate Baselines vs. Industry Standards • Support Diagnostic Benchmarking Efforts to Improve Performance Validate/Diagnose/Improve

  11. Diagnostic BenchmarkingWhere and How Can We Improve? • Coordinate Efforts • Identify Benchmarks (Safety, Customer Service, Productivity, Cost) • Establish Baselines / Historical Trends • Identify Industry Standards / BMPs • Evaluate Baselines vs. Industry Standards / BMPs • Diagnose / Improve • Review/Refine/Repeat Validate/Diagnose/Improve

  12. Case Study #1 (Benchmarking Novice) Overview • Municipal SW Operation with No Formal Benchmarking Experience • Undergoing Major Operational Changes • Need to Respond to Privatization Proponents Validate/Diagnose/Improve

  13. Case Study #1 (Benchmarking Novice) - continued Getting Started • Developing 5-year Rate Model • Using General Benchmarks to Evaluate New Operational Needs • Plan to Undertake Formal Benchmarking Process • Annual Budget Line Item Variance Analysis • Enhancing Budgeting Process to Reflect Costs by LOB • Tracking of Operational Statistics Validate/Diagnose/Improve

  14. Case Study #2 (Experienced Benchmarker) Overview • Municipal Operation with Historical Data and Trend Analysis • Safety • Customer Service • Productivity • Costs • Performance Meets and/or Exceeds Industry Standards Validate/Diagnose/Improve

  15. Case Study #2 (Experienced Benchmarker) - continued Next Steps • Take Existing Benchmarking Efforts to the Next Level • Enhanced Diagnostic Capabilities • Greater Focus on Maintenance Function Validate/Diagnose/Improve

  16. Closing Thoughts • If You Are Not Benchmarking Get Started! • Safety • Customer Service • Productivity • Cost • If You Are An Experienced Benchmarker • Take the Next Step! • Dig deeper! • Keep Peeling the Onion ! Validate/Diagnose/Improve

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