As President of Roth, a national service contracting firm, I thought we had all the boxes checked for running a great business. Believing you're good without knowing if you really are is a scary thing. Yes, we were profitable and growing but could we perform better? How could we improve if I didn't know where we weren't best in class?
I decided to find a benchmarking tool that was comprehensive enough to identify what we were actually doing well and where we needed to improve. You and your team have to be open to discovering the reality of how the business stacks up. Everyone needs to think about this as 'I want to know how we can be better.' I got introduced to the SOAR benchmarking tool from a YPO mate who created it after years of business consulting. If you want to know how you're doing and where your contracting or facility management business can improve, I recommend going through a benchmarking process.
To get the most out of the benchmarking process, I recommend involving your key team members and maybe even some of their team members. The benchmarking product you select should be broad based. SOAR, for example, covers S = Strategy & Vision; O = Organization & Culture; A = Accounting & Finance; and, R = Responsiveness & Execution. Each of the SOAR sections is segmented into four areas. For example, the segments under O or Organization & Culture are Work Environment, Empowerment, Teamwork & Culture, Effective Hiring & Training and Appraisal, Accountability & Compensation. It is very comprehensive and is contractor friendly.
Let's walk through the benefits of benchmarking, the four pillars of SOAR, what is involved and how much time is required to complete the process and then the expected outcomes and actions.
Benefits of Benchmarking
- Achieve significant performance and profit improvement
- Move from diagnosis to action to business improvement faster
- Compare your business to World Class Performance
- Build strong buy-in and ownership to improve your company
- Increase team building and cross-department cooperation
Four Pillars of Strategic Excellence
Strategy & Vision — Identifies whether the business has picked a path that positions it to succeed and outperform competitors.
Organization & Culture — Assesses whether the company's employees are qualified, trained and motivated to turn the Strategy & Vision into reality and whether the work environment facilitates success.
Accounting & Finance — Determines whether the business has the information to enable educated, relevant and optimal decision-making -- as well as cash resources, systems and controls to achieve its strategy.
Responsiveness & Execution — Evaluates the effectiveness of the company's operational execution and how well it responds to its customers' needs.
Soar uses an on-line questionnaire for each segment within each section of SOAR. It can be done on a desktop or smart phone or tablet.
However, you will get the most out of SOAR by going off-site for a day with up to 18 of your people (SOAR allows up to three teams of people to complete the questionnaries and up to six people per team). This full day is facilitated by a certified SOAR instructor (I am certified).
Prior to the facilitated off-site meeting, you will be provided with correspondence to send to those selected to participate that describes what SOAR is about, what the expectations are for the day and what are the expected outcomes and deliverables. A common way SOAR is administered is to have the CEO be in one team, up to six of the CEO's direct reports be in another and up to six people from the next level in the third.
The one day session breaks down as follows:
- 8:00 - 8:30 Introduction to SOAR and Expected Outcomes
- 8:30 - 11:00 Strategy & Vision section - completed by each breakout group as a team and then they all come back together for facilitation
- 11:00 - 1:00 Organization & Culture section - completed in the three breakout groups but done individually by team members (lunch provided)
- 1:00 - 2:30 Responsiveness & Execution section - completed by each breakout group as a team and then they all come back together for facilitation
- 2:30 - 4:00 Accounting & Finance section - completed by the whole group with finance people answering the questions and the others gaining business knowledge in how the company works
- 4:00 - 4:30 Break
- 4:30 - 5:00 Discuss preliminary scorecard and discuss next steps
Expected Outcomes & Actions
The result is a SOARcard, which ranks your company by each of the four sections and four segments within each section by strength (70th + percentile), needs improvement (50 - 69th percentile) and opportunity (below 50th percentile). The SOAR reporting will give you specific actionable information that you and your teams can use to determine the best implementation path and timetable to improve the business. The analysis phase is a great opportunity to celebrate what your company is doing well and also unite your team on a unified path to improve the business for those areas where you are falling short. It is a powerful process when done right.
Using a Facilitator
I would recommend regardless what benchmarking process you use that you engage a facilitator to coach you and your team through this process. I'm a facilitator for the SOAR product and use it for each coaching assignment I have since it focuses on significant performance improvement. The cost of benchmarking products ranges from $2,500 to $7,500 plus $5,000 to $10,000 for the facilitator depending on the level of the engagement.
The cash investment ranges from $7,500 to $12,500 + you and your people's time investment of the full day session. The benchmarking process is a serious investment but it can be a catalyst to transform your company and it's performance.
Running a contracting or facilities management company in today's competitive business environment is hard work. Use the benchmarking process to give your company an edge and improve team building and results at the same time.