Comparative analysis, or benchmarking, of government services can provide valuable insight into economic and operational norms of department functions and identify best practices underlying superior performance. Benchmarking can also help establish baselines for future performance measurement, identify opportunities for optimal resource allocation, provide additional context for budgeting, and foster greater accountability.
Due to the preponderant weight of personnel costs in most government budgets, comparative analysis focuses heavily on full-time equivalent (FTE) resource levels. For a more meaningful analysis, other factors and cost drivers should also be included. For example, a municipality may have a lower level of public safety FTEs than its peer group, but that same city or county may also have a lower incidence of crime and/or fire emergencies.
A comprehensive benchmark study will also take into consideration other "normalization" factors such as population composition and density, climate, geography, infrastructure, interjurisdictional cooperation, resource constraints, municipal priorities, and local economic factors. Consistency in reporting periods and account definitions is also essential in rendering an "apples-to-apples" comparative analysis.
Inputs, Outputs and Performance Measurement
Analysis of government "inputs" and "outputs" provides a basis for comparative analysis among numerous entities, and is a key measure of government efficiency. "Inputs" refer to the organizational resources deployed to meet functional obligations. Typical inputs include personnel, equipment and facilities. "Outputs" refer to key outcome indicators such as crime and conviction rates, fires suppressed, miles of street repaired, patients discharged, building permits issued, library registrations and so forth, depending on the government function.
Fig. 1: Fire Engine Company Example