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