|
Members, please log in Login: Password: |
|
|
|
| ||||||||||||||||||
|
Overview Benchmarking is defined as “the continuous, systematic search for, and implementation of, best practices which lead to superior performance”. In essence it aims to compare a range of performance criteria with what the best in the business are achieving. It is a guide to necessary present performance and to future requirements if the organization is to be “world class”. It is about knowing yourself and really knowing the competition – where they are weak, where they are strong, and where they are going. It is outward facing rather than inward looking. It is concerned with tracking performance, not just taking single snapshots.  Fig. 1 Benchmarking process Of course benchmarking has always existed. People and organizations have always compared themselves to others. But it was the Xerox Corporation that pioneered “competitive benchmarking”. It was the systematic and comprehensive way in which Xerox set about making benchmarking a competitive weapon that has brought this technique into prominence. The benchmarking process is illustrated in figure 1. Types of Benchmarking
Details Why Benchmark? The reasons for Benchmarking can include the following:
But the ultimate reason is To Improve! What to Measure You have to know what to benchmark, therefore the first action to be taken is to identify your Customers (present & future) and assess their needs and processes. These are the areas where the organization absolutely needs to perform well, and where unique advantages can be obtained. There may be a particular interest in targeting areas that are known to be important, such as financial, customer satisfaction, human resource and industry specific measures, however you should concentrate on processes first and the measures of performance second. Who to Measure The aim of competitive benchmarking is to find the “industry best” performance, and where appropriate the “worlds best” performance. The toughest competitors now and in the future are often known or easy to short list, so a search can be more focused. But do not close minds to the possibility of world-class performance from a new or unexpected source. Functional benchmarking of non-competitors with “world class” performance in specific areas is particularly useful. How to measure It is assumed that internal information is easier to obtain. The external information can be sourced from number of areas:
Improvement is key to survival for today’s businesses. If you are not improving, you are losing ground. The best organizations are the ones that have continuous improvement built into their corporate cultures. Benchmarking provides a way to judge how well your organization is performing compared to the “best of breed” and identifies how the best got to be the best. Every time your organization’s name, products, services, or people come in contact with customers or potential customers, the organization is evaluated and scored. To remain competitive, you must make sure that the evaluation places you in the “big league” with the rest of the best organizations. Benchmarking must go beyond just product processes, and justify all business activities, because today a majority of organizations provide high quality products. Product quality is a given. Competitive advantage will come from the excellence of all your customer interfaces and the demonstrated pride your people have in their organization. Without benchmarking you will never truly know how good you are, how good you should be, or how to become the best you can be.
Examples: The following are examples taken from one of Performance Track’s databases (a manufacturing company compared to it’s closest peer group). A performance score of 50 represents an average score for the comparative group, therefore above 50 is better than average, below 50 is worse than average.    
|
|
||||||||||||||||
