BENCHMARKING

Benchmarking is a practice followed by companies where by they identify one or more

organisations that excel in the industry and use the practices followed by them as a source for ideas
and improvement.

Xerox is the company that is accredited with introducing and following this technique nearly
25 years ago. Xerox studied its Japanese competitors to learn how they could sell mid – sized copiers
for less than what it cost Xerox to make them. They learned the technique and adopted it in their
organisation to achieve unimaginable heights.

Today many companies including AT&T, Eastman Kodak, and Motorola use benchmarking
technique as a tool for marketing research.

There are three types of benchmarking:

 Collaborative benchmarking
 Technical benchmarking
 Metric benchmarking

Very recently Tata launched its “people car” NANO. Tata used this technique in actually
producing this revolutionary car. Tata benchmarked Maruti which was the market leader in the
mid segment car. It used the car specifications as the standard and made sure that the vehicle
reached the expected standard.