19 April 2020
This is why Team Benchmarking is crucial to grow your business (especially now)
73% of all failed scaleups stated that their main cause of failure was a lack of having the right (combination of) people on board during the different growth stages of a scaleup. So they didn’t manage to build to right team composition to scale. And that’s because that haven’t been able to benchmark their team.
Team Benchmarking. What is this actually? How does it work to conduct a team benchmark? And why is it so important to benchmark your team, especially in this remote working setting?
After reading this blog post you will know:
- What Team Benchmarking is and why it is important in order to grow your business;
- Why most teams lack off an optimal team composition;
- Why COVID-19 increases the importance of this concept;
- How Equalture’s Team Composition Technology can be of any help.
A quick introduction
Team Benchmarking is the process of analysing your team’s current composition (in terms of skills, competencies and personalities) and benchmarking the results of this analysis against industry averages. The goal of this process is to reveal team risks and gaps to act on.
With industry averages we mean the average composition of successful teams that operate in a similar environment (same expertise, industry, company growth stage, etc.).
Let’s say I want to benchmark our Sales Team. We are a SaaS company and currently in the transition from startup to scaleup. Based on our growth stage, our industry and our team size, I can compare my team to similar teams. This is what we call Industry Averages.
Two main reasons why teams lack of the right composition
Most teams lack of an optimal team composition, while your team composition determines your company’s growth curve. So what’s the cause of this?
The average team is more likely to be homogeneous rather than heterogeneous, meaning that there’s a big overlap in people’s skills, background and personalities – while heterogeneous teams have proven to be significantly more successful.
This team homogeneity is a result of consensual validation and lacking industry benchmarks.
This bias of hiring people who are similar to you is called consensual validation. We tend to like people who are similar to us, or at least are perceived to be similar to us.
From a candidate perspective, in these modern times with social channels such as LinkedIn, it is very easy to find information about someone (like the hiring manager), and make them perceive you as the top candidate. This is not only worrisome for people who hire, but also for the rest of the company, because when similar people over and over again, innovating becomes more challenging.
(Lacking) Industry benchmarks
Industry benchmarks help you understand how successful companies in your industry built their team. Especially when your entire team is below 50 people, meaning that your sub-teams are still very small, it can be quite challenging to find out how to build up your team.
The consequence is that you tend to copy paste your top-performers, which is a very logical train of thought: If these people perform well in my team, the safest people decision to make is hiring people who look like my top-performers.
Although it seems like the most logical move to make, in practice this means that you keep hiring for the same skill set and personality traits over and over again. The results: your team over-represents a specific skill set, but lacks in many other skill sets that you will need to successfully grow your business on the long run.
Industry benchmarks provide you with crucial insights into optimal combinations of skills and personalities for different teams, helping you to know what to look for when growing your team.
Equalture’s Team Composition Technology provides you with industry insights to benchmark your team against. Feel free to schedule a call with us to learn more about this.
The importance of Team Benchmarking, especially now
By conducting a Team Benchmark you will know exactly how your team is composed, what risks there are in your current composition and which skill gaps you should act on, comparing your team to successful teams in similar environments.
These insights not only can help you crystallise your hiring efforts, but moreover enable you to train your current team. And that second goal is more important than ever since COVID-19 has forced many companies to freeze their hiring efforts – while these uncertain times have a significant impact on your team and demand a lot from your team at the same time.
Let’s say I’m benchmarking my Sales Team. I know which skills my team masters and to which extent they master these skills. At the same time, I know what skills they should master (and to which extent).
So my Industry Benchmark shows for instance that critical thinking is extremely important for my team members who are responsible for getting new customers on board, since they should be able to quickly identify a prospect’s problem and reveal the source of this problem (by the way: this might be a nice read if you’re interested in the required skill set of your Sales Team).
It might be that my Team Benchmark shows that now all of my team members responsible for getting new customers on board are the best critical thinkers. But hey, that’s okay, because no one is perfect. However, now that I know this, I can search for ways to help them improve this skill rather than immediately hiring a new team member to fill this gap.
Equalture’s solution for Team Benchmarking
Here at Equalture we built a solution to benchmark your team, in which we leverage neuro-assessment games to assess and compare teams.
This is how it works:
- Teams are asked to complete a set of neuro-assessment games, measuring a set of skills and personality traits;
- The results are analysed to be able to create the following statistics:
- Average team performances per skill/trait;
- Variety in certain skill levels within the team.
- Now these results are benchmarked against industry averages to reveal how your team is performing compared to similar, successful teams.
- The results of this benchmark provide you with:
- Recommendations for skill development in your current team.
- Recommendations for hiring.
Again, please note that you don’t need to start with a payed tool right away. I would recommend you to at least be aware of your team’s skills and personalities, because only when being aware of this you are able to act on this information. And hey, some skill development training is never a bad plan, right?!
So, to summarise..
- Team Benchmarking is the process of analysing your team’s current composition (in terms of skills, competencies and personalities) and benchmarking the results of this analysis against industry averages.
- The goal of a team benchmark is to reveal team risks and gaps to act on.
- Most team compositions are too homogeneous as a result of (i) consensual validation and (ii) lacking industry benchmarks.
- Since COVID-19 has forced many companies to freeze their hiring efforts, it is now more important than ever to have clear team insights and be able to improve your current team. And if you are still hiring (which is a really good sign!), now definitely isn’t the time in which you can afford a poor hire (i.e. someone who doesn’t contribute to your team composition).
- Equalture’s Team Composition Technology can help you benchmark your team through neuro-assessment games and industry insights.
I hope that this information had provided you with a deeper understanding of this concept, its importance and how to start collecting better team insights. In case you would like to learn more about how we can help you, feel free to schedule a call with us.