Benchmarking Key Variables

The process of using indicators to compare business performance against other internal sections of a firm, or between other firms in a similar industry. 

The data is gathered during HR Audits; a systematic analysis and evaluation of all HR activities within a firm and their effectiveness. Qualitative and quantitative data is required.

Benchmarking follows—whereby the business compares their results against other firms; especially those that have ‘best practice’ (industry leader in a specific indicator). Other types of benchmarking includes the ‘balanced scorecard’ approach.

This provides clear direction on improvements and changes to be made in HR practice in pursuit of continuous improvement. 

Human enterprises are complex and require numerous types of data and information in order to accurately measure performance and understand and diagnose organisational issues. 

Quantitative Data: 

Expressed numerically, easily measured and easy to compare trajectory of performance over time. Eg: turnover rates, absenteeism, financial costs of HR programs, number of accidents. These do not reach causes though. 

Qualitative Data / Information: 

Measures that can only be described in words; involving detailed feedback, judgements on current firm policies an programs and recommendations on future directions. 

Human interactions are hard to quantify; such as satisfaction, motivation and emotion. The use of both forms of information are vital to accurately understanding a business.