Benchmarking

Benchmarking your processes, systems, financial and operational performance enables you to assess strengths and weaknesses as well as understand how you compare with your competitors. This can serve as confirmation of results or become the catalyst for changes needed to experience more success. It can also provide feedback for employees and clients. Areas frequently benchmarked include policies, procedures and performance ratios of operational, financial and valuation metrics. These ratios enable leadership to assess the adequacy of their methods, employee’s understanding and acceptance of goals and objectives and ability to deliver results as compared to others in the industry. If deviations are discovered, corrective actions can be implemented to improve.


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COMPLETED CLIENT SERVICES FOR BENCHMARKING

COMPENSATION
An analysis and comparison of salaries, bonuses and other compensation methods and amounts were accumulated and benchmarked with industry reported data. Analysis of variations assisted in making present and future compensation decisions.

FINANCIAL RESULTS
An analysis and comparison of financial and operational statistics were completed. The Company’s results were compared to industry statistics and disclosed how it compared to other firms – competitors as well as others in the industry.
- Review key ratios and critical success factors
- Understanding of the company’s performance compared to others in its industry.
- Where needed, recasting of results to properly compare to surveys.
- Deviations were noted with analysis performed to disclose reasons.
- Strengths and weaknesses of the Company were identified.

Specific analyses included
- Profit percentages, bonus and profit sharing payments, revenue and labor multipliers, chargeability, margins, overhead rates, return on equity and assets, current ratio, accounts receivable turnover, equivalent staff statistics, chargeable hours per person, average billing rates and average salary costs.

Review and analysis of department financial reporting including:
- Review of revenue and expense allocations, reasonableness of allocation methods, consideration of changes in allocation methods and assessment of need for additional departments.
- Specific recommendations were provided on ways to implement and improve performance and profits.

INFORMATION TECHNOLOGY
Software and hardware are continually changing and being utilized differently to maximize performance. Both are benchmarked to assist firms in understanding cost and benefits of information technology. An example includes assessing Project Financial Management software systems utilized to assure proper managing of projects, the reporting of financial results, customer relationship management, budgeting, overhead rates development, reporting metrics to compare to industry statistics and other relevant factors.

OPERATIONAL RESULTS
An analysis and comparison of operational and financial statistics were completed. The Company’s results were compared to industry statistics and disclosed how it compared to other firms – competitors as well as others in the industry.
- Review key ratios and critical success factors
- Understanding of the company’s performance compared to others in its industry.
- Where needed, recasting of results to properly compare to surveys.
- Deviations were noted with analysis performed to disclose reasons.
- Strengths and weaknesses of the Company were identified.
- Specific operational analyses included – Profit percentages, bonus and profit sharing payments, revenue and labor multipliers, chargeability, margins, overhead rates, accounts receivable turnover, equivalent staff statistics, chargeable hours per person, average billing rates and average salary costs.

Review and analysis of department operational and financial reporting including:
- Review of revenue and expense allocations, reasonableness of allocation methods, consideration of changes in allocation methods and assessment of need for additional departments.
- Specific recommendations were provided on ways to implement and improve performance and profits.

PRICING – FEE SCHEDULES
An analysis and report were completed for a company regarding benchmarking pricing rates and methods including hourly rates, unit rates, mark-ups, cost recovery and alternative approaches.

PROCESSES/SYSTEMS
Appropriate processes and systems can improve efficiency and assure proper business information and financial controls. Lee is constantly working with company processes and systems and can benchmark your approach with industry standards.

REPORTING
Reporting approaches for financial results and project progress are crucially important. Examples include financial and operational reporting that enables you to compare to industry published statistics in an easily understood and meaningful manner. Lee has developed reporting methods that communicates your results with ratios that can be easily compared to published industry statistics.