The practice of "benchmarking" is not new. People have always made use of reference points to measure against, whether it was comparing the amount of time or cost that it took to complete a process or comparing the total amount of output over a given time. In the past, benchmarking was used by companies to compare their processes to those of their competition and then later, with those of other companies with similar processes regardless of industry.

The scope and definition of benchmarking has since evolved to not only consist of the comparison of processes, costs, strategies, and performance measurements. Benchmarking today also includes the measurement of different cultural components of a business that can provide the company with a competitive advantage. Specifically designed to support this evolution for companies to benchmark themselves against their peers, Runzheimer's Benchmarking Service ("RBS") was created as an online benchmarking portal. Human resource and relocation professionals may utilize this tool to uncover useful and meaningful benchmarking information for their relocation program. RBS allows companies to measure their policy items and cost information to other companies like themselves or across all industries. High level summaries of findings as well as more detailed report features are available through this unique breakthrough resource.

In particular, the Survey & Analysis of Employee Relocation Policies and Costs gathers valuable benchmarking information on policy, budgeting, and best practices. Survey participants come from a range of industries and company sizes, and survey results are updated in real-time. This survey is designed to share information about domestic relocation industry trends.

Some of the information compared in this survey report includes details about:

• Company revenues
• Company size
• Reasons for policy differentiation
• Components included in relocation policy
• Percentage of exceptions requested/granted that are contrary to policy
• Services that are most commonly outsourced to relocation service providers
• Amount of relocation budget
• Reasons for refusal of relocation offer
  
  

RBS also offers surveys that address trends or issues of interest. A survey is currently available that compares how companies meet the challenges of relocating employees to high-cost locations. For more information on Runzheimer's Benchmarking service, visit http://runzheimer.com/web/gms/rbs.aspx or call (800) 558-1702 to speak with a relocation consultant.

Today, as in the past, the need for rental assistance in the corporate employee relocation industry is growing. According to ERC’s 2005 Transfer Volume and Cost Survey, organizations have been relocating an increasing percentage of renters. In 2004, respondents (160) reported relocating more renters (57%) than homeowners (43%). All of the renter growth over the last several years has taken place within the "current employee" segment of the relocating population, rather than the "new employee" segment. In addition, approximately two-thirds of new hires, according to ERC, were renters who relocated in 2004.

What factors have influenced the need for corporations to review and enhance their relocation policies aimed toward the renter? Employee reluctance to relocate due to high housing cost areas, high cost-of-living areas, and employee or family resistance to moves have been and remain the essential reasons.

The U.S. Department of Labor has stated that in the next decade 80 million baby boomers will be eligible for retirement; this equates to 8 million annually in the next 10 years. However, many of these baby boomers will choose not to retire but will also be reluctant to relocate. At this point in their lives, most do not want to permanently leave their community, sell their home, and leave children, grandchildren, and, more frequently, parents who now require elder care. Many who choose not to retire are willing to relocate if rental assistance can be provided on a temporary basis. This not only will benefit the transferee but the company as well. Corporations faced with the impending retirement of a talented work force can benefit by utilizing this employee segment’s expertise and offering them temporary domestic assignments.

The entrance of Generations X and Y have different values than their counterpart "baby boomers." These generations have become a mobile work force that expects benefits such as flex time, job-sharing, and a need to balance work and leisure time. As a mobile work force, relocation managers are noticing that this group of transferees prefers the flexibility of rental options versus homeownership which can and may hinder their relocation needs.

What issues do corporations face when addressing their renter relocation policies? Increasingly, the following needs should be addressed to accommodate the increasing number of renters:

• Determine what type(s) of rental housing providers (small or large) will best meet the corporation’s needs and employee culture.
• Need for limited service rental product tiers at a lower cost for employees who are provided a lump sum and/or have a limited rental budget.
• Need for short-term and long-term stay options.
• Shorter or more flexible "notice to vacate" options.
• Special needs of inbound foreign nationals.
• Need for policy consulting on temporary living terms specific to various rental markets.

Sources: ERC 2005 Transfer Volume and Cost Survey; U.S. Department of Labor

Runzheimer recently asked Mike Ghislain, Vice President of Human Resources for Runzheimer International, what his view of "Benchmarking" was from the perspective of an HR professional.

Running a "status quo" business went out of style a long time ago, back when performance was measured internally and compared to how the company did last year. Most high performing companies have changed the way they gauge success and now use external comparators to measure everything from voluntary turnover to revenue per FTE. This process is better known as benchmarking and it ought to be part of your toolkit if your company’s vision statement includes the words "leading provider" or "worldwide leader."

As an HR executive of one of the Best 25 Small Companies to Work for in America, I’ve learned first hand the value of using benchmark data to drive improvement at Runzheimer International. We collect benchmark information for as many of our key business processes as we can find. We use this information to determine appropriate targets for improvement and to trend our success in comparison to what we determine to be our peer group. One thing we’ve learned is that you won’t become an industry leader if you are comparing yourself to the average. For example, a 20% reduction in turnover may seem like a fantastic improvement for a given company. However, if the top quartile of this company’s industry is improving at a 40% reduction rate, then 20%, which may be the average, may serve to just keep pace with the industry’s improvement trend.

Implementing an ongoing benchmarking process is a simple and effective first step in assessing your company's performance relative to an appropriate set of external comparators. It has helped us to learn where we are leaders in our industry, and where we have room for continued improvement. Either way, it's a win-win strategy.