How well do you know your company? Can you list all its strengths and weaknesses? What about how well it performed against your key performance indicators (KPIs)?
The best way to get to know your business better is through internal benchmarking. Benchmarking is all about making comparisons to understand how well your company is doing and identify opportunities. Internal benchmarking is when you compare your company to itself.
Internal benchmarking, sometimes called practice benchmarking, can be a great tool for your company to assess performance and identify areas for improvement. So if you’re ready to take a good look in the mirror and identify the good, the bad, and the – not ugly, just in need of improvement – then it’s time to jump into internal benchmarking!
What is internal benchmarking?
The best way to define internal benchmarking is a process of looking inwards to analyze performance, determine best practices, and identify areas for improvement. Now if you remember, we said benchmarking is all about comparison, so the question is, how do you compare your company against your company?
So glad you asked! Well, you can compare different departments or teams against each other or compare data from different time periods. You can compare different processes, workflows, or activities you perform. As with external benchmarking, comparing different internal items will tell you where you can improve and give you ideas to do just that.
There are different forms of internal benchmarking including:
- Strategic
- Performance
- Digital
- Practice benchmarking
Each type analyzes different aspects of your business.
For example, you can compare the strategies or practices of different departments. Or you can compare your digital metrics and performance data to the same quarter the previous year. You’ll get to see which departments excel, identify best practices, and determine which metrics need greater attention to ensure improvement.
What is practice benchmarking?
Practice benchmarking is a type of internal benchmarking that evaluates practices and processes for optimization.
This is a more qualitative type of internal benchmarking that requires analyzing your workflows and how employees and teams complete their tasks. This could include analyzing which tools and technologies you use, the structure and hierarchy of your departments, and the processes you’ve set in place. It’s a great way to determine performance gaps and areas for improvement.
A practice benchmark example is examining which tools your sales team is using to monitor leads. Is the team taking advantage of a good CRM? Do you use CRM workflows for following up with leads in the CRM? Practice benchmarking will identify how you can improve these processes.
Three internal benchmarking examples
There are many ways your organization can create internal benchmarks. Here are a few examples of important internal benchmarks you should be tracking.
Digital Analytics
The top way to improve your online advertising and SEO strategy is through digital analytics. For example, if you reach potential customers via online advertising, you need internal benchmarking to optimize your PPC campaigns. You’ll want to create benchmarks for how many impressions your campaigns receive, what their click-through rates are, costs per action, return on ad spend, and target return on ad spend. Once you’ve gathered all these benchmarks, you’ll need to periodically track them to see if you experienced any improvements.
Another important internal benchmark relates to your SEO strategy. You need to audit your website to understand your organic traffic, monitor keyword ranking, engagement metrics, and how search engines like Google are reading and responding to your site. This audit will reveal important internal benchmarks that you’ll track as you optimize your website content.
Pro Tip: Get all your digital internal benchmarks from the Similarweb Website Performance Tool! Just plug in your URL to see how many visitors came to your site, your website’s ranking, and tons of engagement metrics.
SWOT Analysis
SWOT (Strengths, Weaknesses, Opportunities, and Threats) is one of the basics of strategic management. The first half of this exercise is internal benchmarking. Understanding your organization’s strengths and weaknesses is an important way to identify areas for improvement and know how to capitalize on your strengths to achieve goals.
When analyzing your strengths and weaknesses, you can look at your strategy, your performance, your processes, and your digital presence – do these sound familiar? That’s because we already mentioned each one as a type of internal benchmarking. Is your business particularly strong when it comes to developing strategies? Do you have processes that fall into your weak points where you have an opportunity for growth?
Understanding where your company excels and where it needs improvement is a great start for internal benchmarking.
Process mapping
Process mapping is all about understanding the different steps, stakeholders, requirements, and timetables for workflows in your organization. This can help you fully understand a process, whether there are any bottlenecks or constraints, and identify opportunities to streamline.
For example, you could map your organization’s procurement process. Anywhere you see delays or weaknesses are game for improvement. Maybe finding suppliers is too difficult or closing agreements takes too long. Process mapping will reveal all the problems, giving you the opportunity to make changes.
Track success with internal benchmarks
Internal benchmarking is all about tracking your own success: Are you improving? Improving fast enough? Is progress stalled? The only way you can answer these benchmarking questions is through internal benchmarks. Your increased visibility will set you up to start making improvements immediately.
Interested in learning more about benchmarking? Check out our other blog posts on the topic:
- What is Benchmarking: The Ultimate Guide
- Why Do Benchmarking in Business?
- Benchmarking Strategy
- Benchmarking Best Practices and Examples
- Benefits of Benchmarking: Reap the Rewards of Competitive Intelligence
- 7 Types of Benchmarking for Better Decisions [+ Examples]
- The Why and How of Competitive Benchmarking
FAQ
What is internal benchmarking?
Internal benchmarking is the process of analyzing your own company’s performance, processes, and strategies to determine best practices and identify areas for improvement.
Why should I create internal benchmarks?
Internal benchmarks are the best way to track your organization’s progress.
How do you do internal benchmarking?
One way is to use any business intelligence tools or software your company has to obtain metrics about your organization.
Related Posts
Wondering what Similarweb can do for you?
Here are two ways you can get started with Similarweb today!