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4 Tips on Benchmarking

March 7, 2019

Benchmarking is a process by which a group or entity can see how they compare against other like groups or entities, giving us a sense of how well we are doing and helping us to identify room for growth. Yet, as anyone who has tried comparing the ever-perplexing apples and oranges will tell you, the group to which you are comparing matters far more than the comparison itself. Here we list 4 tips and points to consider when benchmarking.

1. Compare services, not size or specialty. While many hospitals want to compare themselves to similar hospitals by bed size or by hospital type, the reality is that many markets are made up of hospitals of different sizes and types. Therefore, if you narrow your scope of benchmarking to only like hospitals, you might find that you’re doing well against hospitals with like challenges, but in the end you still lose market share. A better way to compare is based on services (i.e. comparing OB patients to OB patients). These are the areas which really compete with each other, as opposed to OB units competing with medical units. PRC and CMS data prove that service is a driving factor of the patient experience, as evidenced by patient mix adjustments.

2. Benchmarks give you context, not direction. Percentile rankings tell you how you perform in relation to others, which allows you to see if you are performing better or worse. However, this number doesn’t tell you anything about what you need to do to be better. So how do you figure out what to do to improve? PRC utilizes key drivers to show these areas to focus on. Key drivers identify the top two to three factors affecting an overall measure – though these factors could affect it positively or negatively. By finding the most important factors rather than focusing solely on increasing the percentile ranking you give your organization a better chance at moving up in percentiles.

3. Avoid moving benchmarks. It might seem sensible to use benchmarks that are updated frequently as a way to stay up to date with where your hospital stands. However, when looking at how data is used in hospitals, this could be detrimental. As scores go up and down due to natural fluctuation in service and error rate, leaders find themselves battling staff perceptions that the data sits outside their control. Further, some goals may take a while to reach, and by constantly changing the goals of the hospital based on the new benchmark, you’ll find yourself unable to give adequate time to any issue. Analyzing benchmarks and setting goals should be done at greater intervals to allow for changes to be implemented and progress to show.

4. Bigger doesn’t always mean better. While having a large group of hospitals to compare against sounds important for benchmarking purposes, representation is ultimately much more valuable. As long as the benchmarking database is representative of hospitals in the country, then the database size is irrelevant. The context will be the same in a norm with 200 hospitals or 2000 hospitals. When selecting a database for benchmarking, focus on representation, rather than sheer size.