As we approach the new fiscal year (FY27) on July 1st, budgets are actively being closed, tweaked to match expectations, and carefully inspected to the various departments within organizations large and small. No service line in modern healthcare ought to be left alone. However, is the use of benchmarking software and critical financial milestones only a useful activity when applied from the top down?
Benchmarking can be one of the most powerful tools in modern organizations—until you look at how it’s applied.
At the department level, benchmarking can work extremely well, or it can be a complete sham due to unique P&L, revenue/cost-driver variables and idiosyncrasies.
Nursing units, care delivery teams, and operations groups are constantly measured against clear metrics:
- Productivity
- Cost per unit or cost per unit of statistic
- Turnover rates (this is your organization red flag)
- Overtime and Hours worked per unit of statistic
- Outcomes and performance targets compared YOY
These benchmarks create accountability, drive efficiency, and make performance visible.
But the further up you go in an organization, the less clean benchmarking becomes.
Why?
Because executives don’t just participate in the system—they design it.
They choose:
- What gets measured
- How success is defined
- Which comparisons matter
- And which ones quietly disappear
That creates an imbalance.
Departments are benchmarked against external standards and internal expectations.
Executives are often benchmarked against metrics they helped construct.
It’s not that executive roles shouldn’t be measured—it’s that their performance is harder to isolate:
- Outcomes are long-term and influenced by many variables
- Decisions are strategic, not operational
- Success can be framed in multiple ways
But here’s the real issue:
When you control the metrics, you influence the narrative.
A department can’t redefine its benchmarks when performance drops.
An executive team can reframe priorities, shift targets, or highlight different wins.
This is why benchmarking feels objective at lower levels—and more subjective at the top.
The takeaway isn’t that benchmarking is flawed.
It’s that it works best where the rules are fixed—not where they’re being written in real time.
Strong organizations recognize this gap and try to address it by:
- Using external, independent benchmarks for leadership
- Tying executive outcomes to long-term results, not short-term optics
- Increasing transparency around how success is defined
Because accountability only works when the people being measured don’t also control the measuring system.
And it is past time to hold executives accountable. Patient satisfaction and turnover rates are some of the best metrics to manage up. Profit margins can mask the real perspectives of employees tasked with arduous everyday work and at a fraction of a fee compared to executive salaries.
It is time to bring integrity back to health systems and create cultures of resilience, transparency, and accountability.
