Benchmarking and achieving best value in public sector organisations

¶ … Benchmarking: Achieving Best Value in Public-Sector Organizations" by Hesham Magd & Adrienne Curry explores benchmarking in public-sector organizations in the UK.

Magd & Curry begin by explaining that, since the "New Labour" administration in the UK has embarked on an "ambitious attempt to reform public sector organisations," the best-value (BV) framework has emerged, which necessitates benchmarking to assist in recording and managing "productivity and quality with a focus on internal and external stakeholders in mind." The UK government has thus promoted benchmarking to public sector organizations. Taking this into account, the authors wished to explore how well benchmarking can assist BV, and if benchmarking, in general, is useful in public-sector organizations.

In order to create goals for public-sector organizations, a sufficient definition of quality must be understood; without an agreed upon definition, goals will inherently lack focus and clarity. Further, introducing the "quality agenda" to the public sector is significantly meaningful to society, for society will directly reap the benefits. Quality has been defined as such: "fitness for use," "excellence," "conformance to requirements," and more. Magd & Curry do not find these definitions sufficient. The authors prefer quality to mean "the extent to which a product and service meets and/or exceeds consumer's expectations."

The authors go on to explore -- as a sort of case study -- how Modernising Government, a White Paper produced by the UK Government, is related to increasing the quality of public services, BV, and benchmarking. Specifically, BV -- which "seeks, in sum, to promote quality services, but at a price the local community is prepared to pay" -- is encapsulated as "modernisation's" second agenda. It is within this framework that benchmarking has been suggested as a tool for monitoring and managing BV in order to satisfy the needs of its internal and external stakeholders. Further, benchmarking has been thought of as one way of allowing the public sector to "inject a wider perspective into performance reviews, and develop appropriate and sharper performance indicators."

Typically, definitions of benchmarking refer to continuous improvement, comparison measurement, and dedication to the process. It refers to an institution learning how it best operates, how another institution best operates, and then implementing changes within an institution that will enable it to "beat" other, similar institutions or simply be the "best in the world." The success of an institution's benchmarking is rooted in what's actually benchmarked, and against whom. Utilizing benchmarking's benefits requires, generally, five steps: planning, analysis, integration, action, and maturity.

The authors move on to a number of case studies that illustrate the benefits of benchmarking processes in public sector organizations. The first case study is of Court Services, an executive agency in the UK that provides administrative support to courts. Using a detailed process of benchmarking -- which included defining what exactly to benchmark, identifying performance gaps and improvements, creating action plans for improvements, and incorporating the plans into practice -- they achieved BV and the Investors in People Award in 1999, along with "excellent quality service." Court Services continues to use benchmarking processes.

The Inland Revenue Accounts Office -- the second case study -- is an accounting office responsible for tax and National Insurance contributions in six UK regions. The Office has benchmarked every two years since 1994, using internal and external indicators to illuminate opportunities for improvement, analyze data, benchmark against "best in class," and initiate improvement programs, implementation and practice. In 1999, customer satisfaction of the Office rated 7.8 out of 10; in 2000, it won the UK Business Excellence and European Quality Award; and it's won the Charter Mark twice.

The third case study regards Warwickshire Ambulance Service's use of benchmarking. Specifically, the Services was interested in the time it took an ambulance at a scene to get back to the hospital. Benchmarking was done by comparison: Warwickshire looked at other ambulance services response times. Warwickshire found that it spent 17% more time at emergency scenes, on average, than other ambulance services. This was equivalent to over 1,000 crew hours per year. As such, Warwickshire's benchmarking has afforded an action plan to improve their performance and efficiency.

Scottish authorities comprise Magd & Curry's fourth case study. Each member of the authorities completed a self-assessment questionnaire called QUEST, of which the purpose was to "raise standards and encourage...continuous improvement." Data was analyzed for the authorities that scored highest, and future meetings have been scheduled to discuss the differences between the high QUEST scores and low scores, and create action plans to implement the practices that lead to higher scores.