Thoughts on Industry Benchmarks

I find benchmarks to be of limited use, mostly for "ballparking" rather than making key strategic decisions. If I discover my anonymous "competitor" has 12.674% fewer staff than I do, what does that mean and why should I care? If you find you’re grossly outlying your industry, that might trigger a deeper investigation, but knowing my spend is plus or minus 2.847384% of the industry norm seems to be little more than nice cocktail party trivia.

Where benchmarks can be helpful is in comparing similar IT initiatives. If I’m spending 20% more and taking 40% longer on an ERP project than everyone else, I better have a darn good reason.

Rather than obsessing over benchmarking, I’d expend the effort on making sure you are setting and meeting appropriate internal service levels, building peer relationships, and tracking the results of your IT spend rather than worrying about how you generally compare to anonymous peers.

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