Quality Management Guide

Step 3: Benchmarking And Assessing Needs

Central to quality management is the idea that you can’t improve what you can’t measure.


Measurement and data collection is key to improving business performance. Before you try to reshape your business, you need to collect at least some data to get an idea of the overall state of the business.

Some key measurements for benchmarking include:

  • Not Right First Time (NRFT) – measures a product’s ability to match a specification and is expressed in ‘number of defect parts per million’.
  • Total Training Days/Employees (%) – measures a business’s level of training investment.
  • Graduates/Employees (%) – indicates level qualified skills in an organisation.
  • R&D Expenditure/Turnover (%) – this is an indication of the business’s investment in the future.
  • Marketing Expenditure/Turnover (%) – this is an indication of the business’s investment in its marketing activity.
  • Value Of Supplies Delivered On Time/Value Of Bought In Materials (%) – this measures the ability of a business’s suppliers to deliver on time.

If you currently collect minimal data, or just financial data, then best practice would be to look at trying to develop a process for performance measurement as a key management tool.

Stakeholder needs

For the purposes of this document, we’re defining stakeholders simply as the people you need to keep happy to be successful. Key stakeholders include employees, customers, suppliers and investors.

You can learn a lot by doing a survey of these groups and asking them to identify
the things that matter most to them.

This document is based on Crown Copyright © 2004
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