Benchmark to escape from Lake Wobegon

Abstract

PurposeThis paper aims to investigate whether an employee reports an accurate view of the relative performance level of the organisation for which they work.Design/methodology/approachUtilizes a survey of 2,517 senior managers, managers and team leaders from 120 different organisations in nine different countries.FindingsThere is significant and consistent overestimation of performance with 75 percent of the management team reporting that their organisation is above average, and only 5 percent rating their organisation as below average compared to its competitors. A very significant finding is that where there is likely to be a greater degree of knowledge of competitor's performance estimation improves.Practical implicationsThe implication of this misrepresentation of the true position is to make it less likely that an improvement initiative will succeed as managers will not be sufficiently motivated to improve an apparently satisfactory status quo. The paper calls for greater focus both on the activity of benchmarking and in the process of spreading knowledge of the benchmarking activity.Originality/valueThis paper extends issues such as the Lake Wobegon effect and socially desirable reporting which have been investigated in depth in the area of personal self‐assessment and applies them into a different arena, that of the employee's view of the performance of the organisation.