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Introduction to Benchmarking . What is Benchmarking. Benchmarking is an improvement process that is used to identify best practice within a peer group and facilitate it’s incorporation into your organization. Why best practice.

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Presentation Transcript
what is benchmarking
What is Benchmarking
  • Benchmarking is an improvement process that is used to identify best practice within a peer group and facilitate it’s incorporation into your organization
why best practice
Why best practice
  • Best practice refers to techniques, methods or processes that are more effective at delivering a desired outcome.
  • Incorporating best practice into your organization can lead to greater efficiency and effectiveness and a happier customer.
benefits of benchmarking
Benefits of Benchmarking
  • Benchmarking helps identify the gaps between the organization that is undertaking the benchmarking assessment and best practice.
  • Undertaking benchmarking can lead to improvements being incorporated into processes and systems delivering gains in efficiency and effectiveness
  • Benchmarking can help align improvement activity with strategic goals and objectives
the benchmarking process
The Benchmarking process
  • Benchmarking has a defined process
    • Identify the process that will be benchmarked – consider what metrics will be measured
    • Measure results in own organization
    • Identify a benchmarking partner (look for one with favourable results or to the metric being measured or known best practice)
    • Measure the process
    • Analyze the conditions that determine the favourable results
    • Determine an action plan to take your organization to the favourable results
    • Review Benchmarking results and conduct regular reviews with your peer(s).
problems with benchmarking
Problems with Benchmarking
  • Problems with benchmarking occur where
    • Data is not obtained for the process being measured – and analysis becomes subjective
    • No peer group/best practice identified (including data available)
    • The gap between current state and best practice is captured but nothing is done about it
    • Assumed best practice isn't best practice
    • Benchmarking happens as a one off event and not reviewed periodically
the importance of data
The importance of data
  • In order to measure the gap between the measuring organization and best practice quantifiable measures need to be taken
  • This requires data
  • Unless this method is followed results can be subjective and inaccurate
  • Follow on improvement activity can have negligible impact
using your peer group
Using your Peer-group
  • Benchmarking relies on a partner organization or “peers” which will be measured against.
  • Peers could be a different group in the same organization (e.g two purchasing departments in a multinational organization) or a completely separate company
  • The importance is measuring your performance against another “peer” with a different standard
benchmarking doesn t stop
Benchmarking doesn’t stop
  • Benchmarking should be viewed as a continuous improvement method
  • Regular reviews of performance should be taken especially if improvement activity is underway to transition to “best practice”
  • Regular reviews of the peer group should be taken to cater for any changes/improvement made
further resources
Further resources
  • For more information try these web resources