Advantages and Disadvantages of Benchmarking. (n.d.). Find Science & Technology Articles, Education Lesson Plans, Tech Tips, Computer Hardware & Software Reviews, News and More at Bright Hub. Retrieved September 6, 2012, from http://www.brighthub.com/office/entrepreneurs/articles/82292.aspx The Benchmarking Process
Benchmarking involves looking outward (outside a particular business, organization, industry, region or country) to examine how others achieve their performance levels and to understand the processes they use. In this way benchmarking helps explain the processes behind excellent performance. When the lessons learnt from a benchmarking exercise are applied appropriately, they facilitate improved performance in critical functions within an organization or in key areas of the business environment. Application of benchmarking involves four key steps:
(1) Understand in detail existing business processes
(2) Analyze the business processes of others
(3) Compare own business performance with that of others analyzed (4) Implement the steps necessary to close the performance gap 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. The author Linda Richter talks about how, Benchmarking goes beyond competitive analysis to understanding the competitor’s output and process of obtaining the output. The advantages of benchmarking include enabling organizations to outperform competitors, opening minds to new ideas, and placing organizations in a continuous improvement mode. Benchmarking is the systematic process of comparing business processes and performance metrics to industry best practices in terms of quality, time, and cost dimensions, and making such comparisons the basis to do things better,...