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7/23/2019 TQMBH14-5 - Session 05
http://slidepdf.com/reader/full/tqmbh14-5-session-05 1/14
Total Quality Management TQMBH14-5
Session 05 COPQ Cases) + Benchmarking
Concepts)
7/23/2019 TQMBH14-5 - Session 05
http://slidepdf.com/reader/full/tqmbh14-5-session-05 2/14
Dipankar Bose - XLRI
Cost of Quality Cases)
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Benchmarking
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Benchmarking in Quality
Benchmarking is the process of continually searching for
the best methods, practices and processes, and either
adopting or adapting their good features and
implementing them to become the “best of the best.”
Benchmarking is the practice of being humble enough to
admit that someone else is better at something and wise
enough to try and learn how to match and even surpassthem at it
APQC (1998)
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Xerox learned from L.L. Bean, a clothing store catalogue
retailer
Motorola from Domino’s Pizza
Digital Equipment Corporation (DEC) from a seeminglyillogical set of partners that included Scott Paper, Campbell
Soup, Whirlpool, Boeing, Hewlett-Packard, and Apple.
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Types of Benchmarking
Competitive Benchmarking
Functional Benchmarking
Internal Benchmarking
Product Benchmarking
Process Benchmarking
Best Practices Benchmarking
Performance Benchmarking
Strategic Benchmarking
7/23/2019 TQMBH14-5 - Session 05
http://slidepdf.com/reader/full/tqmbh14-5-session-05 7/14Dipankar Bose - XLRI
Benchmarking Methodology
Competitive
• Industry leaders
• Top performers withsimilar operating
characteristics
Functional
• Top performers
regardless of industry • Aggressive innovators
utilizing new
technology
Internal
• Top performers
within company
• Top facilities
within company
Best Practice
Overlap
7/23/2019 TQMBH14-5 - Session 05
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Benchmarking Steps Zairi 1994)
Effectiveness
1. Understand
Internal Process
2. Evaluating Current
Performance
3. Identify Procee
Limitations/
Opportunity for
Improvement
4. Improve Processes
. Measure and
Evaluate
6. Set Internal
Standards
7. Control and Manage
Processes
7/23/2019 TQMBH14-5 - Session 05
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Benchmarking Steps Zairi 1994)
Continued
Competitiveness
8. Select Process
Suitable for
Benchmarking
9. Identify
Suitable
Partners
10. Agree on
Measurement Strategy
11. Compare
Standards
12. Understand Why
Difference in
Performance
13. Change Relevant
Practices for Improving
Performance
14. Compare
Standards
15. Repeat Experience
with Same/New
Partners on Regular
Basis
16. Apply
Benchmarking to all
Processes
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
External Benchmarking Sources
External Experts
Professional associates
Consultants
Universities Other experts like
Retirees from target organization
Research organizations
Industry watchers Brokerage firms
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Exchanging Information with External
Benchmarking Partners
Obtain priority list of organization to benchmark
Some organizations will not want to become
benchmarking partners
Select measurements to share With an objective of receiving similar information in
return
Legal considerations and ethical considerations
Identify a contact Who will lead to the right person
Decide what can be offered to the benchmarking partner
In return for the efforts by benchmarking partner
Obtain agreement from benchmarking partner
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Spider Chart for Benchmarking
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
A
B
C
D
E
F
Benchmarked
My Organization
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Benchmarking Gaps and Actions
Sources of benchmark gaps Actions required
Relationship between planning goals
and benchmarking process is not
explained
Communication between these is
necessary
Benchmarks not visible during
planning
Benchmarks need to be integrated
with planningThe weightage of various benchmarks
in the overall benchmark process is
not mentioned clearly
A weighted tree diagram can be used
Cost and customer satisfaction in
benchmarking process is not aligned
Cost benchmark should be aligned to
customer satisfactionCollected data from different sources
may not be interrelated to provide a
direction for benchmarking
The planning should be done to
provide direction for improvement in
proper business function
Communication gap between
benchmarking team and people
connected to process under study
Benchmarking team should include
people from affected process
7/23/2019 TQMBH14-5 - Session 05
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Dipankar Bose - XLRI
Barriers to Benchmarking
Fear of being seen as “copying”
Fear of losing competitive advantage by sharing
information
Arrogance – “We are the best, why benchmark?” Benchmarking trap
Benchmark that which is convenient, but may not be
important
Impatience – “A typical trait” Excuses are too easy