Five Secrets to Benchmarking Excellence Sightlines: Matthew Bausher, Director of Member Operations Janice Nolan, Director of Knowledge Management and Professional Development
Five Secrets to Benchmarking Excellence
Sightlines: Matthew Bausher, Director of Member Operations Janice Nolan, Director of Knowledge Management
and Professional Development
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Session Overview
• 5 Secrets to Benchmarking
• Making the Case using Effective Benchmarking
• Questions and Discussion
2
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Sightlines ProfileCommon vocabulary, consistent methodology, credibility through benchmarking
• 10 year old company based in Guilford, CT• Common vocabulary, consistent methodology, credibility through benchmarking
• 95% Annual retention rate• Tracking $5.9 billion in operations budgets and $4.2 billion in capital projects
• Database of 23,500 buildings and 825 million GSF 3
4
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The 5 Secrets to Benchmarking
Consistency
Accuracy
NormalizationPeer Group
Context
Effective Benchmarking
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The 5 Secrets to Benchmarking
Consistency
Accuracy
NormalizationPeer Group
Context
Effective Benchmarking
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Creating Consistency
How to collect the right data:1. Start with the end in mind2. Create a finite list of priority data pieces3. Collect the same data at every institution• Understand institutional language – how does it fit into your analysis?• Exclude portions of data that are not critical to your analysis
Facilities Operating Budget - Exclusion Examples
Security/Public Safety
Mailroom
Fleet Vehicles/Transportation
Insurance, Tax, Rent
Academic Equipment
Daily Service Staffing – Exclusion Examples
Maintenance – excluded work (Projects/sold-service/moves, etc.)
Custodial – Non-cleaning duties (set-ups moves/special projects/etc.)
Grounds - Non-landscaping duties (driver/mechanic/recycling/etc.)
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The 5 Secrets to Benchmarking
Accuracy
Consistency
NormalizationPeer Group
Context
Effective Benchmarking
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Verify the information is correct and accurateValidating any changes in the numbers
%
8
80
85
90
95
100
105
110
115
FY07 FY08 FY09 FY10
Change in Energy Consumption
Fossil Consumption Electric Consumption
Step 1: Review the information
longitudinally look for spikes or valleys
in the data
Step 2: Compare to other data
pieces to crosscheck data Look for inconsistencies
in the two data pieces
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
2007 2008 2009 2010
Energy Logs Operating Expenditures
Dol
lars
Comparing Energy Logs to Operating Expenditures
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The 5 Secrets to Benchmarking
Normalization
Consistency
Accuracy
Peer Group
Context
Effective Benchmarking
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A B C D E F Sample H I
Gross GHG Emissions 40660 35580 55733 79454 29849 73983 80917 33085 39382
5,000
15,000
25,000
35,000
45,000
55,000
65,000
75,000
85,000
Annual Gross Emissions
MTC
DE
What happens when data isn’t normalized?
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A B C D E F Sample H I
Gross GHG Emissions 23 12 8.6 8 4.1 6.4 8.5 4.2 2.2
1.3
3.8
6.3
8.8
11.3
13.8
16.3
18.8
21.3
23.8
Annual Emissions per Student
MTC
DE/S
tud
en
tWhat happens when data isn’t normalized?
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Finding a way to normalize the information
12
E
What factor affects the metric most:1. Size? (Square footage, acreage, etc.)2. Number of people? (Full-time equivalents, headcounts, etc.)3. Other (Dependent upon metric)
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The 5 Secrets to Benchmarking
Consistency
Accuracy
Normalization
Peer Group
ContextEffective
Benchmarking
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Choosing the “right” comparison groupWho are we and who do we want to be?
Who are you?
•Physical characteristics•Location•Region•Financial capacity•Current program•Enrollment competitors
Who do you want to be?
•Institutional mission•Master plan•Programmatic changes•Future enrollment
14“Not all comparison groups are created equal”
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Or change based upon metricsChoosing the “right” comparison groupUse just one group
“Not all comparison groups are created equal” 15
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The 5 Secrets to Benchmarking
Consistency
Accuracy
Normalization
Peer Group
ContextEffective
Benchmarking
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Or providing superior service in support of institutional mission?
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Putting the data into contextUsing families of benchmarks
Cleanliness Inspection Score*
Sample Institution 4.8
Peers (Avg.) 4.1
Database (Avg.) 4.2
Too many people?
I I
I*Inspection scores on a 5.0 scale
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B
B
Putting the data into contextUsing families of benchmarks
Oldest campus
Highest backlog
•Decreased effectiveness of maintenance staff
•Declining campus appearance
Neglecting campus needs?Or dealing with older facilities?
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Context makes the caseUsing benchmarking to provide…
VALUE
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Charting growth in project spendingSystem F moved from below peer average to above peer average
System A
System B
System C
System D
System E
System F
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00
Total Project Spending FY2007
System A
System B
System C
System D
System E
System F
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00Total Project Spending FY2009
Peer Average
$/G
SF
$/G
SF
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Context makes the caseUsing benchmarking to provide
VALIDATION
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Validating concernsLower operational funding than peers
20032004
20052006
20072008
20092010
$-
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$/ G
SF
20032004
20052006
20072008
20092010
$-
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
Facilities Operating Budget / GSF
Peer Averages Sample Institution
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Validating concernsLower funding means less resources and limited effectiveness
Cleanliness Score*
Sample Institution 3.7
Peers (avg.) 4.3
General Repair/Impression Score*
Sample Institution 3.4
Peers (avg.) 3.9
Sample Institution Sample Institution
23*Inspection scores on a 5.0 scale
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Context makes the caseUsing benchmarking to provide
WHAT-IF? MODELING
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Providing context for funding decisionsUnderstanding what it takes to be competitive
$1.41/GSF on average, annually$1.65M on average, annually
$9.88M over 6 years
Sample Institution
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Aiding organizational decisionsModeling proposed changes versus current peer performance
Decrease of 1.5 Supervisor FTE’s
Decrease of 2 Trades FTE’s
Increase of 2.5 Custodial FTE’s No change in
supervisors (with addition of 2.5 custodians)
Mai
nten
ance
D
epar
tmen
tCu
stod
ial
Dep
artm
ent
HH
II
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The 5 Secrets to Benchmarking……lead to effective benchmarking and often yield positive results!
Consistency
Accuracy
NormalizationPeer Group
Context
Effective Benchmarking
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Institution AMaking the case for increased Stewardship
IMPACT: Realizing the negative impact of sustained capital decline, the Board of Trustees approved additional Stewardship investments of $1.5M annually through FY2014
Case Study: Increasing Annual StewardshipFiscal Years: 2010+
Projected annual investment of $1.5M through FY14, plus $460,000
in “fast payback” funds in FY10
Institution A
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Institution B
Case Study: Custodial OperationsFiscal Years: 2009-2010
IMPACT: Benchmarking aided in validating concerns about the rising costs of the institution’s custodial operations, despite the lack of campus growth or staffing. Subsequent re-bidding of the custodial contract reduced costs by almost $1M.
Member Quote: “...we rebid the custodial [contract], and saved $1M based on your suggestion.”
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
2005 2009
$/G
SF
Daily Service Operating Costs by Department
2010
2009
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Questions & Discussion
Contact Us:
Matthew Bausher Phone: 610.844.9633 Email: [email protected]
Janice NolanPhone: 203.682.4968Email: [email protected]