Process Benchmarking for CFOs: As-Is to TOM

Process benchmarking is the practice of comparing how your business processes actually run today (their steps, hand-offs, controls, systems and effort) against sector standards and best practice for the same processes, so that the gap can be measured and given a value.

Most finance leaders are being asked to do two things at once this year: take cost out and fund growth. Both depend on knowing where the business really spends its effort, yet in most organisations the honest answer sits in people's heads, in inboxes and in spreadsheets nobody owns. Process benchmarking turns that into evidence.

This article explains what process benchmarking is, why most current state assessments fail to produce a decision, and how Intology uses its own proprietary benchmarking platform to take a business from a documented as-is to a costed, board-ready target operating model.

What process benchmarking is, and why a CFO should care

Process benchmarking compares how a process is performed (its steps, hand-offs, controls, systems and effort) against a reference standard for the same process in a comparable organisation. It is different from performance benchmarking, which compares outcomes such as days sales outstanding or cost per invoice. Performance benchmarking tells you that you are behind. Process benchmarking tells you why, and what to change.

For a CFO, that distinction matters because the levers sit in the process, not in the KPI. A slow month-end close is a symptom. The causes are usually visible once the process is laid out properly: journals keyed twice, reconciliations held in personal spreadsheets, approvals that wait on one person, and controls added after an audit point and never removed.

Business process benchmarking gives finance leaders four things they rarely have in one place:

• Cost to serve by process, based on real volumes and frequency rather than estimates.
• Working capital exposure, where delays in order-to-cash or purchase-to-pay hold cash back.
• Control and audit effort, separating what regulation requires from what habit has added.
• A defensible baseline, so savings claimed later by a programme can be tested against a starting point.

Why most current state assessments fail to produce a decision

Many organisations have already been through a current state assessment. Often the output is a set of wall-sized swim-lane diagrams, signed off and then filed. The maps may be accurate, but they do not lead to a decision because they lack three things:

1. Volumes and frequency. A ten-step process run twice a year and a ten-step process run four thousand times a month look identical on a map. Without volumes there is no way to size the prize.
2. A point of comparison. A map shows what you do. It cannot show whether that is good, typical or poor for your sector.
3. A route to the future state. The current state analysis stops at description, so the target operating model is designed separately, often by different people, and the link between today's problems and tomorrow's design is lost.

A board does not need another diagram. It needs to know which processes are costing money, how much, and what it would take to fix them. That is the gap process benchmarking closes.

How Intology captures the as-is

Intology runs current state assessments on its own proprietary process mapping and benchmarking platform, built in-house to codify the method we have used on transformation engagements since 2011. Clients are given secure, access-controlled use of the platform for the duration of an agreed engagement.

For each process we capture the detail that drives cost and risk, not just the sequence of steps:

• Process owner and owning team, so accountability is clear from the start.
• Hand-offs between teams, systems and third parties, where most delay and error enter.
• Manual working, including re-keying, checking and chasing.
• Duplicate data entry, where the same information is typed into more than one system.
• Spreadsheet dependencies, named individually, because a business-critical spreadsheet is both a cost and a control risk.
• Regulatory status, recording whether a process or step exists because law or regulation requires it. This stops a redesign from removing something the business must keep.
• Volumes and frequency, so every process can be sized.

Clients rarely start from nothing. Where existing process maps exist, they can be uploaded as Visio files or PDFs and brought into the platform, then validated and enriched in workshops rather than redrawn. That keeps the assessment fast and respects work the organisation has already done. (For the mechanics of mapping itself, see our process mapping guide.)

Benchmarking against sector standards and best practice

Once the as-is is captured, each process is benchmarked against the Intology sector process library: reference models of how core processes such as purchase-to-pay, order-to-cash, record-to-report, plan-to-produce and hire-to-retire are run well in comparable organisations. The library reflects recognised industry frameworks and best practice, refined through Intology's own delivery experience across sectors including manufacturing, engineering, professional services and PE-backed businesses.

The comparison is quantified rather than descriptive. Because volumes and frequency are captured, the platform shows not only that a process carries three more hand-offs than the reference model, but how many hours a month those hand-offs consume and where the duplicate entry sits.

An illustrative example. Consider a purchase-to-pay process handling several thousand supplier invoices a month. The as-is shows invoices received by email, keyed into the finance system, matched manually against purchase orders held in a separate spreadsheet, and approved by email. Benchmarked against the reference model, the gaps are clear: two instances of duplicate entry, one uncontrolled spreadsheet, an approval step with no delegation rule, and manual matching where the reference model uses automated three-way match. Each gap is sized by volume, so the finance director can see which fix is worth most, rather than which is easiest to describe.

From gaps to a prioritised opportunity register

Benchmark gaps become an opportunity register: a single, prioritised list of improvements, each with an owner, an estimated value and an indication of effort. Opportunities typically fall into three groups:

• Quick wins that need decisions rather than investment, such as removing duplicate approvals or retiring a reconciliation spreadsheet.
• Automation and AI candidates, where a stable, high-volume process is ready for automation. Process first, automation second: automating a poor process only makes the waste run faster. Our article on AI-driven business process redesign covers this in more depth.
• Structural changes to roles, systems, data or organisation design, which belong in the target operating model.

Because every item traces back to a measured gap, the register gives the CFO a basis for a business case that holds up to scrutiny from a board, an investor or an auditor. It also links naturally to a wider cost savings framework.

Defining the future-state target operating model

This is where process benchmarking earns its place. The structural opportunities, together with the organisation's strategy, define what the future state must deliver. The benchmarked as-is becomes the evidence base for the target operating model: how processes, people, technology, data, governance and locations should fit together to deliver the strategy. (If you are new to the concept, start with our explanation of what a target operating model is.)

Two things make the difference between a TOM that lands and one that sits on a shelf.

First, the people side is assessed, not assumed. Alongside the process view, Intology runs a structured team diagnostic based on its TOM diagnostic template, so capability, capacity and ways of working are measured with the same discipline as the processes.

Second, change is designed in from the start. Intology's Embedded Change Model™ means the people who run the processes help design the future state, so the TOM reflects how work actually gets done and the organisation owns the result. A TOM designed around people rather than imposed on them is far more likely to deliver its benefits.

The output is a future-state design that can be traced line by line back to measured problems in the as-is, which is exactly what a sceptical board wants to see. Our operating model redesign service sets out how this is delivered.

What a CFO gets at the end

A process benchmarking engagement with Intology produces a board-ready pack rather than a set of diagrams:

• A validated as-is baseline, with owners, hand-offs, manual effort, spreadsheets and regulatory obligations recorded for every in-scope process.
• Benchmark results against the Intology sector process library, quantified by volume and frequency.
• A prioritised opportunity register, with estimated value and effort for each item.
• A future-state target operating model that traces back to the evidence.
• A sequenced roadmap, separating quick wins from investment decisions so value starts to flow before the larger programme is approved.

Client data is held on a private, access-controlled platform, available only to the people working on the agreed engagement.

Frequently asked questions

What is process benchmarking?

Process benchmarking compares how a business process is performed (its steps, hand-offs, controls, systems and effort) against a reference standard for the same process, in order to find and size improvement opportunities.

What is the difference between process benchmarking and performance benchmarking?

Performance benchmarking compares outcomes, such as cost per invoice or days to close. Process benchmarking compares how the work is done, which explains the outcome and shows what to change.

How long does a current state assessment take?

It depends on scope. A focused assessment of a single function, such as finance, typically takes a few weeks. A multi-function assessment across several sites takes longer. Uploading existing process maps shortens the timeline considerably.

What does the finance team need to provide?

Access to process owners for workshops, any existing process documentation, and transaction volumes for the in-scope processes. Intology's platform handles the structuring, benchmarking and analysis.

How does process benchmarking feed a target operating model?

The benchmark gaps show where the current model falls short. Structural gaps become design requirements for the target operating model, so every element of the future state can be traced back to a measured problem.