In today’s highly competitive environment, organizations are are forced to find their niche. A winning formula, especially ones that can address a tough, fast changing and competitive economic environment is the ultimate goal. Organizations are increasingly turning to their vast data for answers . Business Intelligence initiatives are undertaken in order to help both operational and strategic decision makers to keep up with the market trends by providing insights into the data.
A BI initiative is incomplete without benchmarks, which ideally should be built into the design of data warehouse. In simple terms, a benchmark is a goal that is set beforehand and every stakeholder in the organization right from lowermost personnel, all the way to senior management strive to achieve. All ongoing efforts are captured in the data, which are nothing but results and reported against the benchmark, without which, it becomes hard to answer the questions “Where are we?” and “How are we progressing?“, “Can we make it?” etc.
A benchmark provides a definitive indication regarding performance of the underlying subject area. Since progress is monitored on regular basis against the benchmark, it helps in maintaining the focus towards the final goal. Tracking a metric against a benchmark regularly gives advance indications of problems and enables users and decision makers alike to take corrective actions in order to maintain the course.
There are different types are benchmarks that can be used for different types of performance improvement needs. One important characteristic about “benchmark” is that some elements are common across any industry or domain or functional area whereas certain types are benchmark are very specific to either an industry or functional area.
Note: In further posts regarding benchmarking and BI, this will be dealt in depth.