BENCH MARKING
Principle:
• Systematic Search for best practices, innovative ideas and highly effective operating procedures.
• Systematic method to measure themselves against the best industry practices
•The process of learning, adapting, and measuring outstanding practices and processes from any organization to improve performance
BENCH MARKING
Setting the Bar Higher and
Getting Everyone to Get Over It!
• Organizations learn how the best companies do things
• Understands how these practices differ from their own
• Implement changes to close gaps
BENCH MARKING
BENCH MARKING CONCEPT
What is our performance levelHow do we do it?
What are others performance level?
Creative Adaptations
Break ThroughPerformance
1. DECIDE WHAT TO BENCHMARK
2. UNDERSTAND CURRENT PERFORMANCE
3. PLAN
4. STUDY OTHERS
5. LEARN FROM DATA
6. USE THE FINDINGS
BENCH MARKING PROCESS
Identify Benchmark Subject
Project future performance
Identify Benchmark Partner
Determine Competitive Gap
Determine data collection method
Collection Data
Implement Plans and Monitor results
Recalibrate Benchmarks
Planning
Analysis
Integration
Action
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Communicate Results
Establish Functional Goals
Develop action plans
Types of Benchmarking
• Comparison: (Partner Selection)– Internal – Best in Firm– Competitive – Best in Industry– Functional– Generic
• Form:– Performance Benchmarking– Process Benchmarking– Strategic Benchmarking
Selecting Benchmarking Partners
Benchmarking Type
Benchmarking Type
InternalInternal
CompetitorCompetitor
FunctionalFunctional
GenericGeneric
Potential Benchmarking Partners
Comparable sites, branches, sections, departments within the business
Within the same industry sector
Same function across all industry fields
All industry fields
• Performance benchmarking enables managers to assess their competitive positions through product and service comparisons.
• Performance benchmarking usually focuses on elements of costs, technical quality, product or service features, speed, reliability, and other performance characteristics.
• Reverse engineering, direct product or service comparisons, and analysis of operating statistics are the primary techniques applied during performance benchmarking.
Performance Benchmarking
• Process benchmarking focuses on discrete work processes and operating systems, such as the customer complaint process, the order-and-fulfillment process, or the strategic planning process.
• Process benchmarking seeks to identify the most effective operating practices from many companies that perform similar work functions.
• Its power lies in its ability to produce bottom-line results. If an organization improves a core process, for instance, it can then quickly deliver process improvement
Process Benchmarking
Benchmarking at a Process or Project Level
• Strategic benchmarking examines how companies compete and is seldom industry-focused.
• It moves across industries seeking to identify the winning strategies that have enable high-performing companies to be successful in their marketplaces.
• Strategic benchmarking influences the longer-term competitive patterns of a company. Consequently, the benefits may accrue slowly.
Strategic Benchmarking
AT&T Benchmarking Process
APPROACHES TO BENCHMARKING
AT & T’S 12- STEP PROCESS
1. Determine who the clients are who will use the information to improve their processes
2. Advance the clients from the literacy stage to the champion stage
3. Test the environment Make sure the clients can and will follow through with benchmarking findings
4. Determine urgency. Panic or disinterest indicate little chance for success
5. Determine scope and type of benchmarking needed.
AT & T’S 12- STEP PROCESS
6. Select and prepare the team
7. Overlay the benchmarking process onto the business planning process
8. Develop the benchmarking plan
9. Analyze the data
10. Integrate the recommended actions
11. Take action
12. Continue Improvement
The Benefits of Benchmarking
Benefits include:
· Better performance in meeting customer needs & requirements.
· Establishing effective business goals and objectives.
· Measuring true productivity.
· Becoming competitive
· Identifying & implementing best practice in business processes
LIMITATIONS
1. Idea of copying others
2. It is not a Strategy
3. It is not a business philosophy
Its is only a improvement tool
4. It is not a substitute for innovation
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