To Be Finalised Task of Bench Marking

7/31/2019 To Be Finalised Task of Bench Marking.

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Introduction:

The mind set of organizations has become competitive, comparative, and evaluative in

nature. The goal of organisations is to be the best in class; hence, claiming the status

and prestige that come along with the goal (Spendolini 1992; Zairi 1996; Alstete 1995;

Bender& Schuh 2002). Indeed, the application of quality has led to the emergence of

many successful organisations. One critical tool that businesses can take advantage of

to improve quality, is benchmarking, a methodology that shows how to improve

performance dramatically by comparing the performance of ones own organization with

the best practices of others.

Benchmarking is rightly recognized as an essential tool for continuous improvement of

quality. In the pursuit of status, prestige, and accreditation, most corporations employ

the benchmarking process as the tool for pushing themselves towards the best standard

(Zairi 1996; Coding 1993). There are various definitions of benchmarking, but

essentially it is the process used in management by which organizations compare and

evaluate various aspects of their processes and performances in relation to the bestpractices of leading organizations in same class. Indeed, it is the common-sense

proposition to learn from others what they do right and then to imitate it. W hy reinvent

the wheel if I can learn from someone who has already done it? For decades,

practitioners in the public and private sector have adopted the benchmarking approach

as a useful tool for performance and quality assessments (Collins et al., 2006).

Landmark benchmarking studies have been performed and the results widely publicized

over the years (Camp, 1989; Kolarik, 1995; McNamee, 1994; Yasin, 2002). (Zairi, 2000)

Let us not forget that in order to obtain certification, organizations need to demonstrate

the following:

An operational command of leadership through quality tools and processes;

Good business results through continuous improvement; and

Good prevention-based processes.


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The American Productivity and Quality Center (ODell, 1994) defines benchmarking as

the process of identifying, understanding and adapting outstanding practices and

processes from organizations anywhere in the world to help other organizations to

improve performances. Spendolini (1992) explains benchmarking as a continuous

and systematic process for evaluating the products, services or work processes of

organizations that are recognized as representing best practices for the purpose of

organizational improvement.

Benchmarking is a multifaceted technique to identify operational and strategic gaps, and

to search for best practices that can be applied to close any existing gaps (Yasin, 2002).

The definitions emphasize the value of learning from best practices both internally and

externally for the purpose of achieving superiority (Bessant et al., 2003). For the aim of

our assignment benchmarking is defined in accordance with Massa and Testa (2004) as

learning process that involves observation of external practices and performances,

comparison with internal ones, identification of knowledge gaps and finally the decision:

bridging the gaps acquiring new resources or leveraging on internal ones and investing

in upgrading. The result of this learning process is something new; deriving both from

the integration of external inputs with internal previous knowledge as well as frombridging knowledge gaps.

The goal of benchmarking is to provide key personnel, in charge of processes, with

reputable standards for measuring the quality and cost of internal activities, and to help

identify where opportunities for improvement may reside (Alstete, 1996).Benchmarking

can be an effective diagnostic instrument and it may give rise to alternative solutions,

but that the judgment about how far those solutions can be applied must remain in the

hands of management. A central purpose of benchmarking is therefore to provide

managers with an external point of reference or standard for evaluating the quality and

cost of their organizations internal activities, practices, and processes (Alstete, 1995).

Benchmarking will not be effective if it simply takes a snapshot of a comparative

situation. It needs to be an on-going, systematic process. We need to remember that


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invention is not the only way to express ingenuity. Building on or improving on the

invention of another is also ingenious, as well as time saving and cost effective. When

an organization learns from the experiences of others, it greatly reduces both the time

required to move up the learning curve and the cost of improvement. As not only do

organizations have to do the right thing, they have to do it right the first time by adopting

the best practices and delivering defect free services. Peter Senge(1990) suggests in

The fifth discipline that the most successful organizations are those that are constantly

learning. In fact, the entire purpose of benchmarking is to learn. It is extremely important

for an organization preparing to benchmark to educate itself about the benchmarking

process. This learning experience helps to establish realistic expectations, allay fears

and doubts, lay the groundwork for broad support, and position the organization for

successful benchmarking. The issue is how the organization can leverage the

investment to maximum advantage. The idea is that organizations are composed not of

things but of people and that the people employed by an organization collectively

represent an organisations intellectual capital, its intangible pool of skill, knowledge,

and information. When knowledge is shared, the organization becomes a learning

organization which is capable of creating, acquiring, and transferring knowledge and of

modifying behavior across divisional boundaries to reflect new knowledge and

insight(Garvin,1993,pg 80-81)

In its most basic sense benchmarking is a learning tool designed to reduce uncertainty

in the organizational environment by reference to peer experience. Uncertainty results

from lack of knowledge and is associated with discomfort. Consequently, benchmarking

has both cognitive and affective functions. By identifying what are commonly called

best practices in their industries, companies are creating knowledge but also, and

simultaneously, comfort and discomfortcomfort from realizing that many of their

fundamental challenges are commonly shared, discomfort from the performance gaps

that become apparent in individual comparisons. Beyond learning, benchmarking

renders other ancillary services to an organization. Benchmarking rekindles and focuses

energy by promoting significant developmental goals and furnishing concrete evidence

of the benefits they bring when accomplished. It generally sharpens awareness for

aggressive performance standards throughout the organization and leads to the


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discovery of immediate often incidental rather than systemic improvement opportunities.

Its affective benefit lies in providing visual and salient examples of best practices that

create enthusiasm, excitement, and commitment. Perhaps most significantly, however,

benchmarking promotes broad dialogue at all levels of the organization about its

identity, mission, values, beliefs, and practices. The benchmark is then both a window

and a mirror.

Organisations engaging in benchmarking hope to obtain valuable direct knowledge

about significant organizational processes and structures in their own related industry.

Let us call this adaptive benchmarking. Knowledge garnered in adaptive

benchmarking is expected to drive immediate change in the benchmarking company, as

observations and data lead to the introduction of homologous or analogous practices.

Adaptive benchmarking creates similarity in an industry and, over time, levels

competitiveness without enhancing collaboration. On the other hand, benchmarking

companies may seek to establish a more general and permanent knowledge baseline

for performance comparisons. They use these criteria to chart their own, independent

strategic progress toward the kind of standards that produce outstanding results for their

competitors. Comparative benchmarking seeks broader information about another

companys performance and often allows the expression of the discovered differential in

figures. This in turn facilitates the formulation of strategic goals and learning programs

to close that gap. The companys performance then continues to be measured against

the established benchmark to ensure that after the introduction of innovations the

improvements are actually sustained. Finally, the company will develop its next

generation of benchmarks to reflect not only its new level of performance, but also the

growing learning capability it has developed from meeting its original objectives.

Benchmarking should not be considered a one-off exercise. To be effective, it must

become an ongoing integral part of an ongoing improvement process with the goal of

keeping abreast of ever-improving best practice. We will now illustrate how

benchmarking promotes the emergence and evolution of a learning culture throughout

the organization through the different types and the classic five phases of

benchmarking.


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How do types of benchmarking create a learning culture in the organisation at

large?

."Benchmarking can be closely linked also to the concept of the learning organisation.

It implies the need to learn by experiences, better known as a concept learning by

doing or learning by (own) experience."( Knez-Riedl :2007). Indeed benchmarking

stems out of learning as without trying to know about other best practices and

comparing it is not conceivable that benchmarking will even take place. To achieve the

principles of "Business Excellence" or the " Outstanding practices in managing the

organisation and achieving results", as described by the European foundation for quality

Management(EFMQM) one of the eight fundamental concepts is crucial to achieving

best practices is the "continuous learning" .The other seven being: results orientation;

customer focus; leadership and constancy of purpose; management by processes and

facts; people development and involvement; innovation and improvement; partnership

development; and public responsibility(BPIR.com). This factor seems to be the most

predominant advantage of benchmarking. The various business excellence models of

benchmarking around the globe be it Europe, Canada, Australia, Singapore or the US

have a key concept within their description that is " Organizational and personal

learning" or "Continuous Learning, Innovation and Improvement", or " Knowledge

driven system" or " Continuous learning and people involvement"(Ibid). These

references target one same idea which is the learning culture that benchmarking aims

at over and above "the act of improving particular business process."

Within this process, above aiming at trying to cut on costs, to improve on areas which

need to be seen into or to improve on credibility of the organisation or to acquire new

skills or even to survive in a competitive business environment, benchmarking aimsmore precisely at creating a learning environment within the organisation. If

organisation do not invest time and finance in the creation of a learning culture the

motivation to adopt the change from status quo to a new state of being through

benchmarking will remain a myth for the top management and this will lead to the death

of the organisational goal of survival.


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Therefore it can be assumed that benchmarking is "continuous learning"; "the more it is

practiced, the more can be applied from what has been learned"(Dragolea:2009). This

also goes in line with the Total Quality Management principles: people involvement by

having theme sharing their knowledge and experiencing change via team work;

benchmarking being conducted in a systematic approach whereby efficient and effective

the process is understood and gaps are identified and the system is improved as a

result of the investigation carried out; the whole process of the organisation is constantly

improved as benchmarking is not carried in a vacuum, it ought to be constantly

investigated and re-calibrated. Zairi (2000) echoes the same argument where he states

that benchmarking is a performance analysis which promotes continuous improvement

by "making the organisation grow and develop through a process of continuous learning

at all levels...levels of synergy is measured by assessing learning at management level,

employee level and finally at the organisational level...".Learning can be defined as

continuously seeking and acquiring new skills, behavior, knowledge or information. A

learning environment is one where everyone in your firm is committed, on an ongoing

basis, to gaining new skills, exploring new behaviors and furthering your collective

understanding of the issues facing your firm."( American Institute of Certified Public

Accountants- aicpa.org).

" Although experts break benchmarking into several types, there exist two main types;

"Informal" and "Formal" Benchmarking." (bpir.com) . Knez-Riedl (2007)echoes the same

idea that benchmarking takes form in two ways either formally or informally and

encourages a learning culture, a desire to acquire new knowledge and to build over it so

as to reinvent the process and to achieve the major goals of the organisation. l

According to bpir.com & Knez-Riedl(2007) , we are constantly and unconsciously

"comparing and learning from the behavior and practices of others" during coffee

breaks, team meetings, or while "networking with other people from other organisations

at conferences, seminars and internet forums or in our discussion with experts having

a greater knowledge of the implementation of a particular process or activity in a

business environment" or scouring " online " On-line databases/web sites, such as
http://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.htmlhttp://www.bpir.com/benchmarking-what-is-benchmarking-bpir.com.html


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theBPIR, and publications that share benchmarking information provide quick and

easy ways to learn of best practices and benchmarks". This form of knowledge sharing

is labeled as the tacit knowledge which is "carried and transmitted by individuals and

organizations and which can be captured within a region"(Luis:2010). Knowledge

management is done almost at an informal level creating opportunities to benchmark

output, performance or strategies at an informal level.

The aim is to share information and adopt very easy ways "to learn best practices and

benchmarks". The learning culture or learning taking place in the work environment of

employees is a most sought out advantage of benchmarking above the other many

advantages that it brings to the whole business structure. The focus is on "learning

from others, who know better some procedures, solutions of a definite problem, etc.than we do"(Knez-Riedl:2007).

Knowledge management is not limited to regionalised levels but also to global level

where continual learning is shaped by "explicit or codified knowledge that which is

written down. and which has been transmitted by communications media and which is

not limited within a region a region only." This can be labeled as being a formal type of

knowledge management. BPIR(Business Performance Improvement Resource) calls

for two major formal types of benchmarking namely: Performance Benchmarkingwhich

aims at comparing the performance levels of organisations and Best Practice

Benchmarkingwhich compares the organisation with the best one in practice.

This idea is reflected in Camp(1989) description of benchmarking which emphasises the

quest of "the best industry practices which will lead to exceptional performance through

the implementation of these best practices.

In Kelly ( 2001),Auluck ( 2002), Watson(1993), Andersen (1996) and Zairi(1992)amongst others propose different types of benchmarking. Among these references and

taking into account a common definition of benchmarking, Andersen(1996) provides a

clearer picture of the logic which defines the different types of benchmarking; he argues

that "different types of benchmarking can be defined based on what is being compared

and whom it is comparing against".
http://www.bpir.com/business-excellence-membership-services-bpir.com/menu-id-68.htmlhttp://www.bpir.com/business-excellence-membership-services-bpir.com/menu-id-68.htmlhttp://www.bpir.com/business-excellence-membership-services-bpir.com/menu-id-68.htmlhttp://www.bpir.com/business-excellence-membership-services-bpir.com/menu-id-68.html


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The group of types of benchmarking which relates to what is being compared to is listed

and defined as follows:

1. Performance Benchmarking

Anderson(1996) stipulates that it is "a comparison of performance measures (often

financial, but also operational) for the purpose of determining how good one's own

company is compared to others". Fong et al. (1998) states that it is concerned with the

"outcome characteristics, quantifiable in terms of price, speed, reliability, etc...".

The main purpose of this type of benchmarking is to allow the comparison of the way

the organisation is performing in terms of finance but also in terms of its effectiveness.

Thus the level of achieved performance becomes measurable in contrast to other

organisations.

2. Process Benchmarking

Andersen(1996) describes this type as being " a comparison of methods and practices

for performing business processes for the purpose of learning from the best to improve

one's own process".Fong et al (1998) defines this as a means of comparison "pertaining

to discreet work processes and operating system".The emphasis here is laid on raising

the standards on " critical processes and operations" (beginnersguide.com),

3. Strategic Benchmarking

Andersen (1996) claims that it is "mostly comparison of the strategic choices and

dispositions made by other companies, for the purpose of collecting information to

improve one's own strategic planning and positioning".Fong et al (1998) defines this as

"involving assessment of strategic rather than operational matters."

Whilst the group which aims at comparing an organisation to another regroups the

following:

1. Internal Benchmarking


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Andersen (1996) claims that it is a "comparison between departments, units,

subsidiaries or countries within the same company or organisation..."Fong et al (1998)

defines it as being the "comparison within one organisation about the performance of

similar business units or processes."

2.Competitive Benchmarking

Andersen(1996)stipulates that it is "direct comparison of own performance/results

against the best real competitors i.e. that manufacture the same product or deliver the

same service...the focus is on best competitors."Fong et al (1998) defines it as being

"comparison for gaining superiority over others".

3. Functional Benchmarking

Andersen (1996) claims that it is "comparison of processes or functions against non-

competitor companies within the same industry or technical areas...i.e. problems faced

by such companies are similar."Fong et al (1998) defines it as being "application of the

process benchmarking that compares particular business functions at two or more

organizations".

4. Generic Benchmarking.

Andersen(1996)stipulates that it is " a comparison of own process against the best

processes around, regardless of industry.."Fong et al (1998) defines it as being the act

of "comparing with an organization which extends beyond industry boundaries".

In nearly all types of benchmarking, knowledge is the key to the setting of both long

term and short term goals and objectives(Dragolea&Cotirlea:2009). Knowledge

management becomes the top most priority in the aim to "meet or exceed customerexpectations"(Zairi:2000).The top management will have to diagnose what is to be

benchmarked, with whom it would be most apt to be benchmarked, how to collect data,

how to implement these change.... consider the line of thought merge it with your

phases...and infuse the part u have written on learning organisation...


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Those of us in the quality profession recognize that our quality initiatives should spur the

organization to a higher level of performance. We must set our sights on goals that

stretch beyond the typical achievement and always strive for continuous improvement.

Benchmarking can lead to dramatic gains (by helping an organization move beyond the

traditional incremental improvements) and stimulate innovative thinking. In our present

era of re-engineering, the emphasis must shift away from just cost reductions and move

toward evaluating organizational processes; this involves identifying and enhancing

those processes that work and eliminating those that do not.

Peter Senge says that "learning organizations" (such as Xerox) are doing more than just

copying practices used by others (Senge 1990, l l ) . Merely learning from the best

practices does not necessarily institute learning as an event inside the organization.

There must also be stimulation for those within the organization who are unable to see

that there might be a different, better way of doing business. The first step in this

process is accepting that change is needed and that benchmarking might possibly be a

tool to assist an organization in achieving that goal. But, there is more to it than just the

tool-it must go beyond information exchange to include effective change management.

It goes deeply into the organization and the employees and helps create the motivation

for change that then delivers the dramatic improvement the organization is seeking. It

must drive the organization toward improvement because the current processes are not

good enough.

Constant change is now regarded in the marketplace as stimulation for the continuous

improvement necessary for our organizations and, indeed, our economy, to endure and

succeed in the coming century. Benchmarking can introduce a healthy uncertainty into

the organization about the wisdom of sticking with the status quo, and can help the

organization set the stretch goals that will lead it into the next century.

Benchmarking is continuous learning; the more is practised, the more can then be

applied next time. Ths makes it potentially very powerful. Critical success factors,

processes and roles represents targets of banchmarking. Critical success factors can

be defined as those things which must go right for the organization to achieve its

mission; processes are a collection of related, structured activities or tasks that


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to be studied properly to prioritize the relevant processes. These have to be

benchmarked to an organization.

Communicating company objectives and goals throughout the organization in a

trustworthy way is considered to be a remedy for both collective and personal(management) uncertainty. Information is transferred and interpreted within the

organization to create learning. Collective learning then enhances organizational and

personal flexibility and responsiveness and in this way it leads to corporate

reassurance.

Orgnizations find themselves in a competitive environment characterized by rapid

change. Any competitive edge depends on its ability to deal with change more

effectively and more rapidly than its competitors. It is no longer appropriate for

managers to take all the responsibility for implementing organizational change in

response to rapid and complex changes within the environment. Each individual within

the organization needs to be accountable and take responsibility for making the

necessary changes within their individual work areas. They also need to share their

knowledge with others in the organization thus emphasizing the notion of teams and

teamwork. These are ideals typical of an organization aspiring to develop a learning

organization.

It also focuses the learning process on the desired future position that the organization

would like to be in. Rather than focusing on only one aspect of organizational change,

the company should try to develop a dynamic and iterative process aimed at

providing the organization with a builtin capacity to change and redesign (itself)

continually as the circumstances demand. This has involved transformational change of

the organizational structure, human resource practices, and technology. This means

that at all levels of the organization, employees have been, and are, involved in theprocesses of transformation improvement.

The concept of planning as a learning process is emphasized by Arie de Geus. He

refers t . He refers to the way one of the world's most successful companies, Shell, used


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the corporate planning processes as a constructive and significant way to promote

learning at the strategic and operational levels.

The companys vision is central to defining and developing the organization. It is an

articulation of the core competence of the organization. It should be strongly driven by

its vision and mission. The importance of the vision is strongly emphasized in team

meetings, regular feedback sessions to staff and other types of communications. The

vision and mission should be developed after extensive consultation with employees,

including a competition within the company to find the best mission statement. There is

particular emphasis on the organizations values.

*Analysis Phase

This phase involves analyzing the information collected in the planning phase. An

analysis of the reasons for the better outcomes of the benchmarked processes has to

be done based on the data collected. Based on this analysis, a better process has to be

developed. The next step is to set goals for developing an improved process for your

organization. This goal for the process should be to make as good a process - or an

even better one - than the other organization. Learning is strongly related to

empowerment and most of the best performers encourage employees to make their

own decisions regarding their work and be active and proactive. Moreover, such an

approach needs employees who are willing to continuously develop their skills in

creating new insights as well as their ability to work together as a team. Willingness to

develop and learn as an organization is further highlighted by enabling structures and

loosely structured roles which create opportunities for individual and business

development.

A proper study of which one suits your goals the most should be selected. In terms of

developing a learning culture, learning can be defined as continuously seeking and

acquiring new skills, behavior, knowledge or information. A learning environment is one

where everyone in your firm is committed, on an on going basis, to gaining new skills,

exploring new behaviors and furthering your collective understanding of the issues

facing your firm. The Learning Culture explores the impact that a learning environment


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can have on the employer, the employees, the clients and the firm. In addition, it will

identify the diverse learning styles and interests of the team members. It will also enable

employer to implement a systemized approach to providing the people with the training

and development they need.

This would develop a culture of ``learning'' and a workforce that was ``change skilled'',

both being critical to the future success of the business. The process had five key steps.

First, best practices has to be researched and catalogued for future reference. Second,

to bring about change required an intense ``consultative'' approach in the branch but

due to economic constraints a selective process is required to identify branches where

the greatest improvement could be made. Third, best practitioner managers are to be

selected, trained and seconded to another branch for a period of time during which they

would assist in bringing about the change. Fourth, training and on going support for the

consultants is necessary to maximise the benefits to be gained. Finally, measures of

performance have to be tracked to quantify the benefits gained from the process.

*Integration Phase

This phase takes the planning and analysis done in the earlier steps to further levels

only after being accepted by senior management and department heads. Proper

communication of the findings in the earlier stages has to be conducted and their

commitment established. When the revisions are accepted, the acceptance of the goals

is the next important step.

Employees must be attracted, motivated and developed into talented people who are

committed to the organisations values and vision. The working environment must be

attractive to employees; and take action to enable the employees to develop their full

potential; and the commitment to developing effective leadership.


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Progress in this area can be positive by fostering Senges self-mastery, and as a

launching point for team development. It helps people to cope with significant

organizational changes that have been implemented. For managers, a coaching skills

program can be introduced to build on the learning, using a management for

performance program. The mission award process that recognizes individual and team

performance can be an incentive. The development of team purposes (mission

statements) is useful to obtain greater involvement of all employees in continuous

improvement, and to achieve a shared vision. A culture of continuous learning and

improvement must be entrenched. The identification of improvement opportunities can

be measured and analysed thus enabling all employees to play an effective role in

continuous improvement.

Team work encourages people from different departments to work together to solve

specific problems. Teams are encouraged to take a systems approach to problem

solving and to use collective thinking skills to build on the experience and creativity of

individuals. There are a number of cases. Various initiatives can be essential such as

encouraging employees participation in the building of a shared vision, mission and

value statement.

Organizational culture is based on a form of communication that leads to a process of

improving actions through better knowledge and understanding. It contributes to the

development of a learning organization skilled at creating, acquiring and transferring

knowledge and at modifying its behavior to reflect new knowledge and insights. It is

through open communication and the sharing of adequate and relevant information that

companies develop organizational knowledge in order to change and improve

themselves continuously.

Open communication achieves a basis for learning, i.e. favorable conditions and apositive attitude towards personal and company development and the adoption of new

behaviors. Individuals learn how to learn as they know where to acquire the necessary

information and how to disseminate it. Only after learning how to learn can the

employees participate in the goal-setting process as well as in the building of strategies

by the company. By doing so, all the members of the company can then finally commit


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to building a future together. Activities such as internal inter-departmental benchmarking

and mystery guests performed by employees themselves promote company learning by

engaging in a number of mutually-advantageous learning activities.

*Action Phase

The last phase is the most important phase. It involves developing a plan for

implementation with all the factors involved such as the time line, responsible owners

and targets being planned properly. It is necessary that senior management also be

responsible for the coordination of various activities, monitoring the progress of the

plans and removing any barriers in the implementation process. When the revised

process is in place, a report stating the benefits of the new revised process has to be

developed. The project completion should be the milestone- the benchmark - for any

further projects. The process has to be a continuous one so that the initiative does not

fail due to neglect.

The last phase in the process has three steps. This phase is where the improvement

parts have been taken into consideration. Ultimate benefit to a company from

benchmarking is judged by how well this particular phase has been carried out. The last

step of this phase, Keep the Process Continuous, implies this.

Develop Action Plan for Implementation After the improved process is accepted by all

concerned or likely to be affected by it, a detailed action plan is drawn with all key

activities taken as inputs. The detailed action plan should carry the important things like

a time line, individuals responsible for carrying out the tasks, any short-fall in the

completion of tasks and what stretch targets are taken to compensate the short-falls.

Those responsible should be committed enough to ensure that the tasks and

assignments are completed on time.

Implement Specific Actions and Monitor Progress While those who must complete

assignments on schedule have a responsibility, so does senior management. They

must be committed enough to ensure proper coordination of various activities, monitor

the progress of implementation of the plan and work as a barrier-remover in the

implementation process. When the revised process is in place, a complete report has to


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be prepared, showing the benefits of the revised process compared with the

expectations at the time of approval of the proposed revision of the process.

Keep the Process Continuous The successful completion of one project can lead to

an important milestone for the organization. The next step would be bringing inadditional and more ambitious projects and benchmarking with the best approach.

While carrying out the total activities, a mechanism or a system has to be built in to

review the performance of the improved process periodically to ensure that the benefits

are retained. The process has to be a continuous one and should move at a constant

speed and should never be neglected.

The review points for this phase are:

One of the biggest advantages of benchmarking is the extent of improvements the

organization makes by learning from the processes of others. A better and proven

process can be adapted, with suitable modifications for company requirements, with

less time invested for inventing new methodologies. Benchmarking also uncovers new

ways of improving a companys own processes by motivating actions learned from

studying and experiencing those organizations with best-in-class processes.

Benchmarking is definitely advantageous, as it involves learning from others to make

suitable changes to suit your company's requirements and goals.

BENCHMARKING PHASES BENCHMARKING ACTIVITIES

Phase I

Plannning the benchmarking processand characterization of the item (s)

1. Identify what to benchmark

2. Obtain top management support3. Develop the measurement plan

4. Develop the data collection plan

5. Review plan with location experts

6. Characterize your benchmark item


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Phase II

External data collection and analysis

7. Collect and analyse internal

published information

8. Select potential internal

benchmarking sites

9. Collect internal original research

information

10. Conduct interviews and survey

11. Form an internal benchmarking

committee

12. Conduct internal site visits

Phase III

External data collection and analysis

13. Collect external published

research information

14. Collect external original research

information

Phase IV

Improvement of the items performance

15. Identify corrective actions

16. Develop an implementation plan

17. Gain top management approval of

the FSS

18. Implement the FSS and measureimpact

Phase V

Continuous improvement

19. Maintain the benchmarking

database

20. Implement continuous

performance improvement

If u took it frm smoneone plz make the refrence..


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Other than aiming at "financial benefits" of the orgnisation, by comparing the

organisation with other best in practice, a culture of learning is infused in the mindset of

those who have to collect the data and undergo the five phases of benchmarking. It

basically adheres to the "organisational learning" and "the learning

oragnisation"(Auluck:2002).

Limitations of benchmarking

Any organization has its strengths and weaknesses. As it has already been stated

earlier, benchmarking is a tough process that needs a lot of commitment to succeed. It

has its benefits in order for a company to improve by learning from the best. However,

there are also limitations in benchmarking. A first step towards a better understanding of

the implementation of benchmarking exercises is to identify and discuss the barriers

that typically arise during this process (Camp, 1989).

Limitations can be defined as barriers that arise when things are not moving correctly

and this depends on many factors. Some of the major pitfalls identified with

benchmarking include that it is not always pragmatic and realistic, the cost associated

with its implementation is very demanding associated with a limited resources, the

difficulty in obtaining information for which to benchmark against, a significant lag time

between implementation and results. Benchmarking is also time- consuming, there is

also in some case an unavailability of data. Other disadvantages associated to

benchmarking are employee resistance, employees fear of exclusion, unwillingness to

change and a lack of training.

1. Not always pragmatic/ realistic:

Compared with other types of analysis techniques, benchmarking does not have any

predictive power to anticipate future performance, results or benefits (Halloway, Lewis

and Mallony 1995). Although great care may have been taken in the analysis of other


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companies and the activities they developed to reach certain performance levels, there

is no guarantee that those same activities will yield the same results in another

organization. The differences may be due to a number of reasons, including a perceived

cause and effect between performance and the activities that really do not exist.

2. Cost associated; limited resources:

Costs have also been identified as a potential problem with benchmarking. (Alstrom et

al., 1998; Bhutta and Huq, 1999; Biesada, 1991) When done properly, the

benchmarking process requires a substantial amount of time and resources analyzing

other companies data and activities, developing and implementing new activities in the

workplace, and improving continually the process of data collection, analysis and

modification.

3. Unavailability of data:

A third area that can become a problem for benchmarking is the availability of valid data

from other organizations. In order to establish effective benchmarks, one must know the

performance levels of other organizations. It may be difficult due to differences in

measurements used across industries.

4. Time consuming and expensive

Benchmarking is said to be too expensive. Benchmarking does come at a price, but

costs vary considerably. The benchmarking process requires a considerable amount of

time from when the decision is made to benchmark to when measurable results are

realized.But with careful planning, benchmarking costs can be kept to a minimum.

5. Employee resistance

One obstacle is resistance on the part of some employees. With new changes, there willalways be some employees reluctant to get involved and cooperate with new policies.

Staff resistance can be problematic at various stages from beginning to acting on the

results of benchmarking. (Elmuti and Kathawala 1997,) and Hinton et al.2000)

6. Employees fear of exclusion/redundancy:


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Benchmarking will shake people if they think that this is a device to get rid of them

(Fong et al.1998). If the objectives of the organization are not clear, that is there are

misunderstandings on the reasons why benchmarking is crucial for the organization,

employees may fear of being excluded and may thus not cooperate and show any

commitment in the workplace.

7. Unwillingness to change:

Many people resist change because they have been in their jobs for years and are not

willing to face the challenge of learning new skills or they feel stressed when required to

move out of established comfort zones (Macadam, 1996) they are resistant to change of

any kind due to comfort with status quo, fear of the unknown, or regulations that impede

change.

8. Lack of training:

Training is a key requirement for the success of a benchmarking team. Without training

in the process, tools, techniques, and philosophy of best practices, benchmarking teams

are severely handicapped (Bogan and English ,1994)

9. Lacking proper implementation:

Another problem with benchmarking occurs if an organization fails to properly

implement the process. One example of this is not involving employees during the

process. Ultimately, these employees will need the information to improve the process.

Therefore, lacking proper implementation can be considered as a problem in

benchmarking.

10. Implications on management and employees:

Lack of leadership enthusiasm for benchmarking is also a barrier in benchmarking.

Benchmarking requires feedback and participation from all levels of an organization.

Managers implement the process and train employees to know and understand the


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process. In order to benchmark effectively, a company needs a strong strategic focus

and some flexibility to achieve the goals set forth by management. Perhaps the most

important aspects of effective implementation are adequate planning, training, and

interdepartmental communication. (Armenakis and Bedeian, 1999; Hoag et al., 2002;

Jick, 1993; Macadam, 1996);

Mistakes can be avoided by setting goals and following the rules to achieve them.

Companies that benchmark identify specific areas of weakness, and find solutions to

turn them into strengths. But for the benchmarking process to be successful, an

organization needs these general requirements:

Senior management interest and support:

A solid understanding of the organization's operations and requirements for

improvement:

Openness to change and to new ideas;

Willingness to share information with benchmarking partners; and

Dedication to ongoing benchmarking efforts.

Benchmarking makes it easy to identify the gap between where the organization would

like to be and where it actually is. This gap provides a measure of the improvements an

organization needs to make. Ignoring this gap and refusing to change decreases long-

term survival opportunities of the organization.


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(U should go directly to Phases directly)

Benchmarking is the continuous search for the best practices that lead to superior

performance. It is a systematic way to measure performance capabilities of competitors

or recognized leaders and then develop plans to meet or exceed these levels (Steeples,

1993, 268). In layman terms, it is the process of continuously measuring an

organization's processes and methodologies against those of other organizations, with

the challenge of improving its own performance. This includes identification and

possible adoption of "best practices"-both within and outside the organization's industry.

This leads to benefits such as increased customer satisfaction, enhanced business

performance, strengthened goal-setting, quality improvements, streamlining the

business, and a stronger organizational culture. It provides an organization with a

measurement system that fosters improvement. we already defined bmking make the

link between ur part and mine

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To Be Finalised Task of Bench Marking