Understanding an organisation’s size and complexity relevant to the peer group is an essential step for interpreting the data

When looking at the demographics quartiles for a peer group, certain considerations can be assumed by considering the size and complexity of the company being benchmarked.

Below is examples of five companies and their size / complexity compared to the distribution of a peer group

 

Based on these distributions, we can assume the following when analysing each company’s data:

  1. This company is smaller than the majority of the peer group and will therefore be affected by economies of scale. Costs may be higher on a normalised basis as a result.
  2. This company is slightly less complex than the majority of peers, but well within the middle 50% of the peer group (Q1-Q3). As a result, we may see some costs be slightly lower due to the simpler processes and procedures
  3. This company fits in with the peer group and therefore, data is not expected to be skewed due to size.
  4. This company is more complex than 75% of their peers, and as a result costs may be higher due to more complex processes and procedures
  5. This company is larger than every company in the peer group, and therefore economies of scale are expected to make the client seem more efficient on a normalised basis
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