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CONTENT
Benchmarking Meaning
Benchmarking Definition
Benchmarking Objectives
Why Benchmarking?
Benchmarking Types
Benchmarking Process
Advantages & Disadvantages
Limitations
Conclusion
Reference
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WHAT IS BENCHMARKING?
‘’ Improving Ourseleves By Learning From Others’’
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 Benchmarking is the process of improving performance by
continuously identifying, understanding, and adapting outstanding
practices found inside and outside the organization.
Benchmarking is the process where different companies compare
their nature of work with other compnies in same field of business &
they set certain type of standard of work.
 How are others better ?
 Why are others better ?
 What can we learn ?
 How can we catch up ?
 How can we become the best in our industry?
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The formal definition of benchmarking is “The continuous process
of measuring products, services, and practices against the
company’s toughest competitors or those companies renowned as
industry leaders”.
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OBJECTIVES

Establish what is achievable from an improvement perspective

Motivating and stimulating company employees towards the goal
of continuous quality improvement.

Understand how other companies have designed their processes

Determine what not to do(i.e. learn from mistakes of others).
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WHY BENCHMARKING?
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WHY BENCHMARKING?
 Benchmarking is a more efficient way to make
improvements.
 Managers can eliminate trials and errors. Benchmarking
speeds up organization’s ability to make improvements.
 Today, time is of the essence.
 Benchmarking has the ability to bring your performance
up as a whole significantly.
 Learn from others’ experiences. Set realistic but ambitious
targets
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TYPES OF BENCHMARKING
 On the basis of “What” is being compared with other
organizations and “Who” is being compared with our
organization, we can classify benchmarking.
What” is being compared
with other organizations
V/S
Who” is being compared
with our organization
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On the basis of “What” is being compared with other
organizations we have four main types. These four
major types of benchmarking are evolutionary
beginning with product, through to functional
(performance), process and strategic benchmarking.
Strategic
Process
Performance
Product
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 On the basis of “Who” is being compared with our
organization, we have these categories
External vs internal
Generic
International
Best in Class
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PROCESS OF BENCHMARKING
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PLANNING
•
During this phase the organization determines which process to
benchmark and against what type of organization.
•
Select the process
•
Form Team
•
Understand & document process
•
Establish performance measure
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ANALYSIS
Following data acquisition, an analysis is performed for the
performance gap between the source organization and the
recipient organization. An indication of best practice is then
evident.

Sort information & data

Quality control information & data

Normalise data if necessary

Identify gaps in performance Level

Identify causes for gaps
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INTERPRETATION
 Two groups must agree on the change
• Process owners (those who run the process)
• Upper Management (incorporating changes and
providing resources)
 Communicate Benchmark findings and recommendation
and get approval.
 Establish Functional Goals
ACTION
 Specify tasks
 Sequence tasks
 Determine resource needs
 Establish task schedule
 Assign responsibility for each task
 Describe expected results
 Specify methods for monitoring results
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RECALIBRATION
 The next step is to repeat the benchmarking process
 The benchmarking process must be used continuously to pursue
emerging new ideas
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ADVANTAGES
• Helps organisations understand strengths and weaknesses.
• Helps better satisfy the customer’s needs by establishing new
standards and goals.
• Motivates employees to reach new standards and to be keen on new
developments.
• Helps organisations improve their competitive advantage.
• Is a cost-effective and time-efficient way of establishing a pool of
innovative ideas.
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DISADVANTAGES
• Incorrect comparisons
• Lack of information
• Lack of understanding
• Copying others
• What is best for someone else may not suit you
• Poorly defined benchmarks may lead to wasted
effort and meaningless results.
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LIMITATION TO BENCHMARKING

Benchmarking is a tough process that needs a lot of commitment to succeed.

Benchmarking should be a continues process as the competition is always
changing.

Selection and empowerment of benchmarking teams.

The adaptability of the practices should be tested and the implementation
results should be verified.
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THANK YOU
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