Benchmarking Code of Conduct – 2023 Version

For the TRADE Best Practice Benchmarking Methodology & Best Practice Improvement Resource (BPIR.com)

Introduction

Benchmarking is a powerful method for breakthrough thinking, innovation, improvement and for delivering exceptional performance results. Benchmarking involves learning from the experience of others and applying this learning to improve performance.

Benchmarking is most successful when following a structured benchmarking methodology such as TRADE. The name of TRADE reminds users to develop strong two-way relationships with other organisations (the benchmarking partners) in order to share or trade information and best practices for mutual benefit.

The methodology guides benchmarking teams to develop a Terms of Reference, Review the current situation, Acquire and learn from best practices, Deploy best practices and Evaluate the project’s success. The methodology encourages strong engagement with stakeholders to obtain their ideas and input and combine these with the best practices found to develop the most effective solutions or next practices.

The TRADE Best Practice Benchmarking Code of Conduct builds on previous work undertaken by several organisations and adds further clarity to bring the Code of Conduct up to date. The first Benchmarking Code of Conduct was developed by the American Productivity Quality Centre’s International Benchmarking Clearing House and Strategic Planning Institute Council in 1993. It is now usually referred to as APQC’s Benchmarking Code of Conduct. The second is the European Benchmarking Code of Conduct, developed in 1996, whereby the original wording was modified to consider the rules of European Union competition law. The European Benchmarking Code of Conduct was developed by the European Foundation for Quality Management and a small group of sponsoring organisations. A third version with further modifications was developed by the UK Benchmarking Institute in 2006/7.

Users of the TRADE Best Practice Benchmarking Methodology are expected to follow the Benchmarking Code of Conduct when undertaking a benchmarking project. Adherence to this Code will contribute to efficient, effective and ethical benchmarking.

1. Principle of Preparation

1.1 Learn and follow the stages and steps of the TRADE Best Practice Benchmarking Methodology for professional and effective benchmarking.

1.2 Understand your own work practices/processes before asking other organisations (benchmarking partners) to share information on theirs.

1.3 Undertake background research on potential benchmarking partners utilising publicly available resources prior to contacting them. This will help to ensure the benchmarking partner is a good fit for your information request and enable you to ask pertinent questions.

1.4 Make the most of your benchmarking partner’s time by being fully prepared for each exchange (with an agenda set and questions prepared).

1.5 Help your benchmarking partners prepare by informing them in advance of your key questions and agenda prior to benchmarking meetings (on-line or face to face).

2. Principle of Contact

2.1. Respect the corporate culture of partner organisations and work within mutually agreed procedures.
2.2. Contact the benchmarking partner through their designated benchmarking contact if they have one.
2.3. Agree with the benchmarking partner on how communication with the benchmarking partner should proceed throughout the benchmarking exercise and the role and responsibilities of both parties. Check for mutual understanding.
2.4. Obtain a benchmarking partner’s permission before providing the names of individuals from a benchmarking partner to other organisations.
2.5. Avoid communicating the names of individuals from a benchmarking partner in an open forum without the contact’s prior permission.

3. Principle of Exchange

3.1 Be willing to share the same type and level of information that you request from your benchmarking partner with the benchmarking partner.
3.2 Communicate fully and early in the relationship to clarify expectations, avoid misunderstanding, and establish mutual interest in the benchmarking exchange.
3.3 Be honest, complete and timely with information submitted.

4. Principle of Confidentiality

4.1 Treat Benchmarking findings as confidential to the individuals and organisations involved. Such information must not be communicated to third parties without the prior consent of the benchmarking partner who shared the information. When seeking prior consent, make sure that you specify clearly what information is to be shared, and with whom.
4.2 An organisation’s participation in a benchmarking exchange is confidential and should not be communicated externally without their prior permission.

5. Principle of Use

5.1 Use information obtained through benchmarking only for the purposes stated and agreed to with the benchmarking partner.
5.2 Communicating a benchmarking partner’s name with the data obtained or the practices observed requires the prior permission of the partner.
5.3 Contact lists or other contact information provided by benchmarking networks in any form may not be used for purposes other than benchmarking.

6. Principle of Legality

6.1 If there is any potential question on the legality of an activity, don’t do it or take legal advice
6.2 Avoid discussions or actions that could lead to or imply an interest in restraint of trade, market and/or customer allocation schemes, price fixing, dealing arrangements, bid rigging or bribery. Do not discuss costs with competitors if costs are an element of pricing. Do not exchange forecasts or other information about future commercial intentions.
6.3 Refrain from the acquisition of information by any means that could be interpreted as improper, including the breach, or inducement of a breach, of any duty to maintain confidentiality.
6.4 Do not discuss disclose or use any confidential information that may have been obtained through improper means, or that was disclosed by another in violation of a duty of confidentiality.
6.5 Do not, as a consultant, client or otherwise pass on benchmarking findings to another organisation without first getting the permission of your benchmarking partner.
6.6 If data and information is to ‘blinded’ and anonymous so that the participants’ identity are protected, it is still necessary to agree with the benchmarking partner(s) on what can be shown and how it can be shown.

7. Principle of Completion

7.1 Follow through with each commitment made to your benchmarking partner in a timely manner.
7.2 Complete a benchmarking effort to the satisfaction of all benchmarking partners as mutually agreed.

8. Principle of Understanding and Agreement

8.1 Understand how your benchmarking partner would like to be treated and treat him/her in that way.
8.2 Agree how your partner expects you to use the information provided, and do not use it in any way that would breach that agreement.

9. Benchmarking with Competitors

The following guidelines apply to Benchmarking with both actual and potential competitors:

9.1 In Benchmarking with actual or potential competitors, ensure compliance with competition law. Always take legal advice before benchmarking with actual or potential competitors and throughout the benchmarking process. If uncomfortable, do not proceed. Alternatively, negotiate and sign a nondisclosure agreement that will satisfy the legal counsel representing each partner.
9.2 Do not ask competitors for sensitive data or cause the benchmarking partner to feel he/she must provide such data to keep the process going.
9.3 Do not ask competitors for data outside the agreed scope of the study.
9.4 Consider using an experienced and reputable third party to assemble and ‘blind’ competitive data.
9.5 Any information obtained from a benchmarking partner should be treated as internal, privileged communication. If “confidential” or proprietary material is to be exchanged, then a specific agreement should be executed to specify the content of the material that needs to be protected, the duration of the period of protection, the conditions for permitting access to the material, and the specific handling requirements that are necessary for that material.

Benchmarking Protocol

Benchmarkers:

• Know and abide by the Benchmarking Code of Conduct.
• For a benchmarking project ensure at least one member of your team has been trained on benchmarking and all team members have at least a basic understanding of benchmarking.
• Follow a recognised benchmarking methodology.
• Prior to initiating contact with potential benchmarking partners, determine what to benchmark, identify key performance variables to study, identify superior performing organisations, and complete a rigorous self-assessment.
• Prepare questions and share your key questions in advance with the benchmarking partner to help the benchmarking partner’s own preparations.
• Possess the authority to share and be willing to share information with benchmarking partners.
• Work through a specified contact and mutually agreed arrangements.

When the Benchmarking process proceeds to direct contact (site visit/virtual meeting), the following behaviours are encouraged:

• Provide meeting agenda in advance.
• Be professional, honest, courteous and prompt.
• Introduce all attendees and explain why they are present.
• Adhere to the agenda.
• Use language that is universal, do not use jargon.
• Be sure that neither party is sharing proprietary or confidential information unless prior approval has been obtained by both parties, from the proper authority.
• Share information about your own process, and if asked, consider sharing study results.
• Offer to facilitate a future reciprocal visit.
• Conclude meetings and visits on schedule.
• Thank your benchmarking partner for sharing his/her process

Important notice:

This Code of Conduct is not a legally binding document. Though all due care has been taken in its preparation, the authors will not be held responsible for any legal or other action resulting directly or indirectly from adherence to this Code of Conduct. It is for guidance only and does not imply protection or immunity from the law.