The VMS Benchmark
The fundamental objective of the VMS benchmark is to use mathematical processes to avoid the disadvantages related to simple indicators and peer groups.
Correspondingly, the VMS benchmark offers a measurement design with a large number of advantages:
- VMS’s comparison process uses weighted reference sizes, thereby guaranteeing that, from a relative point of view, very solid, comparable data sets are taken into account more often, and that relatively less account is taken of data sets that are less good. The rigid peer groups are thus broken up.
- Breaking up of the rigid peer groups makes it possible to “get a look over the fence”. Approaches that have been successfully implemented in other industries can, if necessary, be used.
- Criteria used to form peer groups play a more or less important role for different types of problems. This is fully taken into account through the introduction of flexible weights.
- The scaling process ensures that only comparable reference sizes are compared with each other. The one-dimensional and linear dependence of costs, which is implied by simple indicators of traditional benchmarking approaches, is replaced by a markedly more realistic model. This model takes account of bases, non-linearities and dependencies of multiple parameters.
Each innovative process brings not only new strengths but also new problems with it. The critical side effect of the VMS benchmark is that the process cannot be displayed on a simple spreadsheet.
There are several reasons for that:
- The quantity of measured data requires the capacity of a database. We are talking here about millions of items of basic data.
- The mathematical processes require functionality and computing capacity that is not available in conventional spreadsheets.
- Dynamic modelling can almost never be implemented in a spreadsheet.
- This means that the high-level complexity of the process requires the corresponding tools – i.e., software – and the corresponding know-how.
However, VMS has transformed the increased technical effort into an advantage. While in conventional peer group benchmarks, analysts typically took days to complete their work, VMS reduced the effort for calculating a DNA-level benchmark down to a few hours, using the suitable software – fully automated and without human intervention.
VMS clients use this in critical project situations for spontaneous detail analyses.