Traditionally IT departments have used benchmarking – where internal processes are measured and then compared with other organisations – to tighten up the way existing processes are carried out, whether by external suppliers or internal teams. Outsourcing is evolving and it is altering the way benchmarking is being carried out too. Delivering innovation is becoming a real driver in outsourcing contracts. Similarly benchmarking is becoming a way to establish new, improved working methods.

Reflecting, the fact that supplier relationships now involve driving change and innovation, our customers are now starting to look for benchmarks that not only prove they are getting value today but that the services they receive are consistent with emerging trends, in terms of what the services are, how they are delivered and what they are ‘bundled’ with. Consequently benchmarks are beginning to reflect not just pricing and results but also supplier agility, innovation, flexibility and quality.

Historically, benchmarks have often been dictated in the Request For Proposal (RFP), or sometimes included in the contract negotiation stage. These benchmarks still have a role to play in service measurement. Additionally, to capture the new type of benchmarks, a new approach will be needed in the future. Often the traditional RFP requires suppliers to simply tick off their capabilities from a list and the benchmarking will then be done against these capabilities. However customers looking for innovation and transformation need to have a less rigid RFP approach as there will be more than one ‘right’ way to solve the problem, or more than one ‘right’ supplier service.