Benchmarking Success: Overcoming the Challenges of Continuous Improvement

By Jenny Love, Chief Content and Marketing Officer, Association for Healthcare Philanthropy

Benchmarking is the process of comparing the performance of an organization to that of other organizations in its industry or sector. It involves analyzing the processes and practices of these other organizations, with the goal of finding best practices and ways to improve the organization’s performance being benchmarked.

The term “benchmarking” was first coined in the 1980s by Dr. Robert Camp, a management consultant and researcher, after a surveyor’s mark used as a reference point in measuring altitudes.1 Though it dates to the early days of computing, benchmarking has become increasingly important as technology has advanced and become more integral to our daily lives. The growth of the Internet and the increasing reliance on technology in businesses and other organizations led to the development of more sophisticated benchmarking tools and techniques. These tools made it possible to evaluate the performance of systems and products in a more comprehensive and accurate way.

Today, benchmarking is used in a wide range of industries, including computing, manufacturing, finance, and healthcare. It is an essential tool for healthcare philanthropy organizations that want to improve their performance.

“There’s a lot of work that gets done by the gut, but if you really want to become a more efficient and effective fundraiser, use benchmarking,” says Jared Langkilde, MBA, CFRE, president and CEO of HonorHealth Foundation in Scottsdale, Arizona. “The shortest distance between two points is a straight line, and that’s what benchmarking gives you. It shows you what you should be doing, and whether what you are doing is making a difference.”

Benchmarking can also help fundraising organizations build credibility.

“Numbers are the most effective way to show relevance,” says Julie Cox, vice president of development for Life Bridge Health in Baltimore, Maryland, who has been benchmarking for several years. “Benchmarking gives my foundation credibility and helps me articulate the business of fundraising to our donors, our staff and our C-suite.”2

Elizabeth Gross, interim vice president at Luminis Health Anne Arundel Medical Center in Annapolis, Maryland, agrees.

“People think the foundation is just parties and pearls,” she says. “Being able to show how datadriven we are and how we measure up helps our profile in the organization.”

Benchmarking can be a powerful tool, but it is not without its challenges. Here are tips from organizations with established benchmarking programs for overcoming those challenges and reaping the benefits of regularly assessing performance against peers.

Challenge #1: Identifying Appropriate Benchmarks

One of the first challenges of benchmarking is finding the organizations or practices that will serve as benchmarks. It is important to select benchmarks that are relevant and meaningful to your organization, and that represent the best practices in the industry or sector.

Identify the specific areas you want to benchmark.

The first step in finding good benchmarks is to find the specific areas of your organization that you want to benchmark. This will help you to focus your search and ensure that you are comparing your organization to others that are relevant and meaningful. It’s ok to start small.

“The biggest mistake I made at the beginning was trying to look at everything,” says Keith Curtis, CFRE, executive director of Grande Prairie Regional Hospital Foundation in Grande Prairie, Alberta. “And I couldn’t. I had to break it down.”

Dzenan Berberovic, Chief Philanthropy Officer at Avera Health in Sioux Falls, South Dakota, recommends a similar approach.

“What gets measured gets managed. When you embark, you’re going to feel there are many measures that can be implemented to establish as your goals,” he says. “Select a few that will lead you to where you want to go. Maybe it’s only three in that first year. Focus on them, and you’ll start to see results. It’s invigorating when you realize you are on the right track—or you’re not and you need to keep iterating.”

Healthcare philanthropy experts recommend starting with the following metrics, all of which are benchmarked in the AHP Report on Giving and defined in the AHP Standards Manual:3

• Return on investment (overall and by activity type—e.g., major gifts, events)

• Cost to raise a dollar, and

• Net fundraising revenue (overall and per fulltime employee).

Seek out organizations with similar characteristics.

Look for organizations that are like your own to find benchmarks that are more directly comparable to your organization.

“We look for organizations that are similar to our size from an employee base, overall patient revenue, number of hospitals or that are in the same part of the country,” says Berberovic. When choosing the right foundations to compare to, Curtis looks for organizations with a similar size and structure and that are specific to healthcare.

“We stay away from broad philanthropy benchmarks,” he says. “A university foundation has a low cost to raise a dollar, but they have no labor, because it’s all paid for by the university. They have multiple buildings and multiple wings that they can use for naming rights. Whereas in our hospital, that’s impossible. It’s hard to benchmark against that.”

Use external benchmarking resources

Your own internal data can be a valuable source of information and can help you to benchmark your organization’s performance against its own past performance, which can be a great place to start the process of becoming more data oriented. However, you will get the most insight from benchmarking yourself against others.

There are many external benchmarking resources available to help you compare your organization’s performance to that of other healthcare foundations, such as industry associations, consulting firms, and donor management system databases, which can be a valuable source of benchmarking data and information. Participating in AHP’s annual Report on Giving is a good place to start out.

“The Report on Giving is a light version of benchmarking, and it’s also a lot easier to understand the data. Don’t be afraid of the numbers, stick your toe in, and learn from it,” Jory Pritchard-Kerr, FAHP, executive director at Collingwood General and Marine Hospital Foundation in Collingwood, Ont. “You don’t know what’s effective until you find your starting point. How do you know whether you’re improving if you’re not measuring the same thing year over year over year?”4

Align your organization with industry standards

One considerable hurdle to beginning external benchmarking is that the way your organization tracks processes and results can differ from the way it is done at the organizations you want to compare yourself to. For example, let’s say your organization holds a large fundraising gala, which has the potential to raise gifts of $10,000 or more. While some development programs might categorize these donations under “events,” others might track them under “major gifts.”5

Aligning definitions for the metrics you choose to track is important to avoid confusion and promote apples-to-apples comparisons. AHP’s Standards Manual is a good place to start to understand best practice methods for tracking metrics specific to healthcare philanthropy.

If your organization is larger and many different people are involved in entering gifts, it may be necessary to coordinate among everyone to ensure the same definitions are used throughout the organization. At Avera Health, a crossfunctional group of philanthropy staff have been leading a 24-month database hygiene initiative. The database governance committee has created standards, operating procedures, and logic documents to ensure that entries into the database are consistent and support Avera’s philanthropic growth agenda and strategic plan. As a result, their data is easier to benchmark.

“We’re all trying to pull together in the same direction for the same purpose,” says Dan Cook, Operations Officer at Avera Health. “That’s really key.”

Elizabeth Gross, who works with her database administrator, Elizabeth Foley, to fill out the AHP Report on Giving benchmarking survey for her organization annually, is intimately familiar with the complexities of ensuring that her organization’s numbers align well with the organizations she benchmarks against. When Foley pulls data to report against benchmarks, she notes areas that do not align for future process changes. She keeps as close as possible to the definitions in the standards manual, but she also tries not to get too hung up on perfection. Both Elizabeths believe that a close comparison is better than no comparison at all. “I would give the advice to go into this with the spirit of ‘I’m going to answer this as best I can,’” Gross says. “If you take too long getting everything correct it won’t be sustainable.”

Use benchmarking software.

There are many software tools available that can help you to gather and analyze benchmarking data. These tools can automate the data collection process and make it easier to compare your organization’s performance to that of other organizations. For example, Report on Giving participants get access to AHP’s benchmarking platform with predefined comparison data sets for community hospitals, academic organizations, health systems, children’s hospitals, and more to enable you to analyze performance against similar organizations with the click of a mouse.

Challenge #2: Maintaining Momentum

Another significant challenge of benchmarking is maintaining momentum and staying committed to continuous improvement. It can be easy for organizations to lose sight of their benchmarking goals and to fall back into old habits. In organizations that have historically not used data to drive decision making, team members can be reluctant to embrace it. Culture is notoriously difficult to change, but there are a few steps you can take to increase your organization’s comfort with using data in operations and strategic planning and to help you stay committed to continuous improvement.

Set clear, measurable goals

One of the best ways to stay committed to continuous improvement is to set clear, measurable goals for your organization. This will help you to focus your efforts, track your progress over time, and ensure that everyone understands what they are working for and how data can help achieve these goals. Having clearly stated goals also helps you take corrective actions more easily before you get too far off course.

“If a gift officer’s performance is struggling, and it’s showing up in the data, it’s a great opportunity for a leader to come to the rescue before the officer even knows that they are in need of support,” says Langkilde.

Involve your team—and senior leadership

Involving your team in the continuous improvement process can help to build buy-in and commitment to the process. People are more likely to be committed to initiatives they are personally invested in. Encourage open communication and collaboration and involve your team, your C suite, and your board in setting goals and finding areas for improvement.

“Hospital leadership is so data driven. They are looking at clinical data and length of stay and case mix index all day long,” says Gross. “To be able to put your own points in there is critical when advocating for resources and explaining challenges and needs.”

It can be scary to bring underperformance to light, but it’s a necessary part of the process. “One of the things that I hear a lot from people who aren’t [benchmarking] is they’re afraid of the information that their board will find out. You can’t be afraid to have that conversation with your C-suite or with your board and tell them that this is all about improving,” says Pritchard-Kerr.

Pritchard-Kerr shares 10 years of benchmarking data with her board annually.

“It’s something to make them understand how revenues can fluctuate, especially during campaign cycles, and we want them to have a long-term look at what’s going on,” PritchardKerr says. “By using the benchmarking data, we can validate to our board what is happening across the industry and use it as a tool for them to determine whether the investments we’re asking for are valid and will pay off in the end.”vi

Berberovic also finds value sharing benchmarking data with his system board.

“We take a look at the data and highlight three or four key measures that are most important for a board member to understand,” he says. “The figure that our board has started to look closely at is overall return on investment.”

Measure your progress

Regularly measuring your progress and tracking your progress towards your goals will help you to stay motivated and focused on continuous improvement.

Berberovic, for example, has created dashboards that the individual giving team can see at any point to track goals, progress and key performance indicators. The dashboards are used as much as daily for one-on-one meetings and in meetings with their prospect and strategy officer. Transparency allows the team to see and celebrate early wins and to observe growth in philanthropic giving on a regular basis.

“You have to make it part of your everyday life,” says Curtis. “If you wait until the last Friday of the month, you’re not going to keep up with it. Take the time to set up ongoing reports, and work with other people to run their reports that you need.”

It’s also important to make the reports you create easily accessible to everyone involved, either through a business intelligence tool or even a spreadsheet on a shared drive. Berberovic’s team will soon be able to access their dashboards live via a hyperlink.

“Coming up with the report and then shelving it doesn’t do anyone any good,” Landkilde says. “You have to review it on a regular basis.”

If your staff is not used to working with data, it might be necessary to supply training in understanding data, analytics, and how to use the data to drive decision making, so that they can benefit from the progress reports you create.

Be open to new ideas

Be open to innovative ideas and approaches and encourage your team to think creatively and challenge the status quo. Encourage data-driven decision-making by promoting a culture of experimentation and hypothesis testing. This can be achieved by rewarding employees who use data to inform their decisions and by promoting an open dialogue about the insights that emerge from data analysis.

“Beneath each benchmark is a best practice,” says Langkilde. “If you identify that best practice and start doing the work with intentionality and integrity, you’re going to see results. [For example], our donor count had been declining for years. We’ve stabilized and are now growing the donor pool by doing categorical work identified in AHP benchmark reports, such as direct mail, phone-a-thon, and email campaigns.”

Engage with other organizations

Don’t be afraid to reach out to other organizations and ask them about their processes and practices. Many organizations are willing to share information and best practices, and this can be a valuable source of benchmarking data and process improvement advice.

“I often look at other high performers in the industry and try to learn who is running those programs,” says Cox. “We work in a profession where we all want to learn and share best practices, so I’ve found my peers are always open to meeting and learning from one another.”7

There’s a Chinese proverb that says, “The best time to plant a tree was 20 years ago. The second-best time is now.” So it is with benchmarking.

“You’ve got to start somewhere,” says Langkilde. “The world is not going to improve overnight, so the sooner you start benchmarking and develop a baseline for your performance, the sooner your efforts will yield fruit and provide a positive story that can be shared. Benchmarking is a means of helping you and your organization to become your best.”

Jenny Love is a highly skilled marketing professional with a strong focus on content marketing. She has more than 20 years of experience in the industry and currently serves as the chief content and marketing officer at the Association for Healthcare Philanthropy. In this role, Jenny oversees marketing and communications and is responsible for creating and publicizing thought leadership content on healthcare philanthropy topics in a variety of media.

Prior to her current role, Jenny held senior marketing positions at several healthcare organizations, including CAQH and the Advisory Board Company. She has written extensively about the business of healthcare and has led several successful product launches and customer acquisition campaigns.

Jenny holds a bachelor’s degree in international economics from Georgetown University and a master’s degree in healthcare administration from the Johns Hopkins University Bloomberg School of Public Health.

Endnotes

1 HotStats. “The Story of Benchmarking: History, Processes and Practice,” November 17, 2018. Accessed January 27, 2023. https://www.hotstats.com/hotel-industry-resources/the-story-of-benchmarking-history-processes-and-practice

2 Momberg Lawver, Alissa. “Using Benchmarking to Improve Performance, Show Value.” www.ahp.org, n.d.

3 “Philanthropy KPIs and Why You Need Them,” May 11, 2018. Accessed January 27, 2023. https://www.ahp.org/ resources-and-tools/ahp-connect/ahp-connect-details/ philanthropy-kpis-and-why-you-need-them

4 Jones, Jasmine and Jacqueline Walsh. “5 Common Misconceptions About Benchmarking Data,” December 5, 2018. Accessed January 27, 2023. https://www.ahp. org/resources-and-tools/ahp-connect/ahp-connect-details/5-common-misconceptions-about-benchmarking-data.

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LIMITING PERSPECTIVE #1: Grateful patient and family fundraising is a mechanism for giving.

While unintentional, grateful patient fundraising is often viewed as a way to give, rather than an understanding of why one gives. Thus, grateful patients and their families are often not approached in a way that creates meaningful engagement from their perspectives.

Antidote:

Focus on the motivations behind the patients’ and families’ sentiments, rather than the mechanisms through which that support is delivered. Even though creating materials in which grateful patients can self-identify can be valuable, this is not enough. The process begins with understanding the prospective donors’ interests in philanthropic support that goes beyond their simple ‘thank you,’ and continues with productively uncovering their motivations.

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Antidote:

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Antidote:

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