Benchmarking

Benchmarking : Quality by comparison

FICCI CE

Benchmarking

Benchmarking is quality by comparison for achieving better standards. In the global movement today , the competition is increasing at a faster rate , and the only way to improve your relative quality and move upwards is to benchmark with the best in the class.

Benchmarking :- Stages of improvement

World ClassRecognized as the best. Benchmarked by others even in other sectors

Best in ClassExceeds customer expectations,outperformsall competitors and has clear competitive edge

EfficientMeets all internal requirements for cost margins,asset utilization,cycle-time and measures of excellence

IncapableIs ineffective , inefficient and at the risk of failing.Needs major redesign

EffectiveSatisfies all customer requirements

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Benchmarking methodology

Benchmarking can be of various types - Competitive benchmarking, product benchmarking, process benchmarking and best practices benchmarking. Whatever be the category chosen by the organization, the benchmarking methodology remains the same in each case. Benchmarking methodology is explained through 5 simple steps in the following slides.

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A. Identify processes to benchmark

• Select processes to benchmark.• Measure current process capability.• Understand detailed process which needs improvement.

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B. Select organization to benchmark

• Select organizations which perform your process.

• Compile a list of world class process parameters.

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C. Compile the required information

• Develop a detailed questionnaire to obtain desired information.

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D. Analyze gaps

Identify the performance gaps and develop an action plan to close the gaps. Also highlight and quantify the consequences of not closing the gap.

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E. Develop an action plan

• Review observations of the gap analysis.

• Set new performance standards.

• Develop an action plan for meeting the new performance standards.

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