Arts & Business Team Blog

Why benchmark your organisation?

Simply put, without benchmarking you are operating in the dark. You don’t know what best in class looks like in enough detail to be able to know whether you’re achieving it or not. Many non-profit arts organisations currently rely on conversations with peers or an occasional look at RFO funding levels or Charity Commission annual data to work out whether there are improvements they could be making to either their costs or their income models. In this day and age this simply isn’t good enough. Organisations need to know the difference between their performance and best in class.

For a benchmark to be really useful the sample you select needs to be as specific as possible. So, if you want to see how you are doing vs. your immediate peers you do need to be able to filter the data to make comparisons to organisations of a similar size, sector and geography. If however you want to see how your business model would need to change if you were to sustain the higher overheads of a new/larger/bespoke building then you would choose to compare your figures to those who represent this aspirational group. Today you can filter benchmark data by region, size of organisation and sector in both the Arts & Business and Culture Benchmark services … no more excuses about the data not being specific enough!

The Culture Benchmark data shows that benchmarking is certainly worth it. The difference between the average and the best in class (we define this as the top 25%) is some 15%both for income and cost. Knowing you’re best in class is well worth a look if it could make 30% difference to your business model!

Of course the data also needs to be easy to query and easy to view the results. I for one am really impressed with the visual interface that Arts & Business have devised for the 2010 data. Few of us enjoy looking at raw data and the hassle of importing data from multiple and varied data sets tends to put us off setting up these comparisons in the first place. So how can we make benchmarks more useful going forward? Well, for a start we need a bit of standardisation of definitions and data structures by the various data collectors. The Culture Benchmark and Arts & Business have started to do this so that these data sources interconnect … The Culture Benchmark is strong on the detail of income and cost and of course Arts & Business is strong on the detail of philanthropy, donations and sponsorship so there are natural overlaps that we need to make the most of. We also need to use up to date technology to collect, analyse and share the benchmarks. This would mean that not only would your profile data on your organisation be carried through from one year to the next but you’d also be able to compare across the years whereas many of the data sets collected at the moment do not allow longitudinal questions to be answered.

How can you get the data you need? As benchmarking is relatively new (with the exception of some work around box office data) many of us working in this field are keen to hear the views of arts organisations and their data needs. So do get in touch to talk about how you’d like to use benchmarking so that we can evolve the services, questions and results accordingly.

Sarah Thelwall,

MD, MyCake.Org