SUBJECT: - APPAREL QUALITY MANAGEMENT II

TOPIC: - what is benchmarking

Types of bench marking
Advantages of benchmarking

Submitted to: -

Mr. Sumit kumar

Assistant professor

Submitted by: -

Gargi Kawalkar

BFT/18/L7
What Is Benchmarking?
Benchmarking is a process of industrial research that enables
managers to perform company-to-company comparisons of
processes and practices to identify the “best of the best” and to
attain a level of superiority or competitive advantage. The Japanese
word dantotsu—striving to be the best of the best—captures the
essence of benchmarking. It is a positive, proactive process to
change operations in a structured fashion to achieve superior
performance. The purpose of benchmarking is to gain competitive
advantage.

Benchmarking is where you measure your company’s success

against other similar companies to discover if there is a gap in
performance that can be closed by improving your performance.
Studying other companies can highlight what it takes to enhance
your company’s efficiency and become a bigger player in your
industry.

Benchmarking Examples
Process Benchmarking: This type of benchmarking helps you to
better understand how your processes compare to others in your
industry. By looking at other companies in the industry you can
improve your processes to make them more efficient and cost-
effective.

Strategic Benchmarking: Strategic benchmarking, similar to

process benchmarking, is all about improving parts of your company through
looking at others in the industry. Strategic benchmarking relates to
strategy and how to create a strategy that will allow you to be more
competitive in your area.

Performance Benchmarking: Performance benchmarking is the

hardest process to improve as it involves learning about competitor
performance metrics and procedures, and also making changes to processes
within your business on the lower levels. Introducing new processes
is a challenging action in any business as it requires buy-in from
many different levels in the company. Performance benchmarking
can uncover findings that might not be possible to implement in the
business without creating a long-term change plan. These can be
also the most effective and successful changes for a company.
Types of Benchmarking
Internal benchmarking: Internal benchmarking is a comparison of
a business process to a similar process inside the organization to
acquire the best internal. business practices. At the federal level,
two Department of Transportation sites might prepare their budget
submissions for Congressional approval. In the private sector, a
retail food store chain selects its most profitable store as a
benchmark for the others.
Benefits: -

 Most cost efficient

 Relatively easy
 Low cost
 Fast
 Good practice/training with benchmarking process
 Information sharing
 Easy to transfer lessons learned
 Common language
 Gain a deeper understanding of your own process
 Makes a great starting point for future benchmarking studies

Challenges: -

 Fosters mediocrity
 Limits options for growth
 Low performance improvement
 Can create atmosphere of competitiveness
 Not much of a stretch
 Internal bias
 May not yield best-in-class comparisons
Competitive benchmarking: Competitive benchmarking is a
direct competitor-to-competitor comparison of a product, service,
process, or method. This form of benchmarking provides an
opportunity to know yourself and your competition better; combine
forces against another common competitor. An example of
competitive benchmarking within the Department of Defense, might
include contrasting Army and Air Force supply systems for Joint
initiatives. Within the private sector, two or more American car
companies might benchmark for mutual benefit against common
international competitor; or, rival chemical companies benchmark
for environmental compliance.
Benefits: -

 Comparing like processes

 Know your competition better
 Possible partnership
 Useful for planning and setting goals
 Similar regulatory issues

Challenges: -

 Difficult legal issues

 Relatively low performance improvement
 Threatening
 Limited by trade secrets
 May provide misleading information
 May not get best-in-class comparisons
 Competitors could capitalize on your weaknesses

Functional benchmarking: Functional benchmarking is a

comparison to similar or identical practices (e.g., the picking process
for assembling customer orders, maintaining inventory controls of
spare computer parts, logistics to move operational forces, etc.)
within the same or similar functions outside the immediate industry.
Functional benchmarking might identify practices that are superior
in your functional areas in whatever industry they may exist.
Functional benchmarking would be accomplished at the federal level
by comparing the IRS collections process against those of American
Express. Comparing copper mining techniques to coal mining
techniques is an example in the private sector.
Benefits: -

 Provides industry trend information

  Quantitative comparisons
 Better improvement rate; about 35

Challenges: -

 Diverse corporate cultures

 Great need for specificity
 Not invented here. syndrome
 Common functions can be difficult to find
 Takes more time than internal or percent
 Must be able to visualize how to adapt the best practices

Generic benchmarking: Generic benchmarking broadly

conceptualizes unrelated business processes or functions that can
be practiced in the same or similar ways regardless of the industry
(e.g., transferring funds, bar coding, order fulfilment, admissions,
replenishing inventory, warehousing, etc.). Generic means without a
brand. It is a pure form of benchmarking, (Camp, 1989). The focus is
on being innovative and gaining insight into excellent work
processes rather than on the business practices of a particular
organization or industry. The outcome is usually a broad
conceptualization, yet careful understanding, of a generic work
process that works extremely well. Generic benchmarking is
occurring when a Veterans Administration hospital's check-in
process is contrasted against a car rental agency's check-in process.
Adapting grocery store bar coding to control and sort airport
luggage might be another example.

Benefits: -

 High payoff; about 35 percent

 Non-competitive/nonthreatening
 Broad, new perspective
 Innovative
 High potential for discovery
 Examines multiple industries
 Can compare to world

Challenges: -

 Difficult concept
 Can be difficult to identify best-in- class
 Takes a long time to plan
 Known world-class companies are inundated with requests
 Quantum changes can bring high risk, escalate fear
 Class organizations in your process
The Benefits of Benchmarking
Competitive Analysis: By identifying areas you wish to improve on
in your business and benchmarking your existing performance
against competitors, your business can strive to enhance your
execution tenfold. Using benchmarking this way has allowed
businesses to gain strategic advantages over competitors and grow
industry averages.

Monitor Performance: Benchmarking involves looking at current

trends in data and projecting future trends depending on what you
aim to achieve. In order to know you have been successful,
benchmarking needs to be a continuous process. Monitoring
performance is an inherent characteristic of it.

Continuous Improvement: As well as monitor performance,

continuous improvement is an essential attribute of benchmarking.
This is because the aim of benchmarking is to improve a certain
element of a business. This improvement should not merely be
something that improves once and is forgotten, but something that
improves over time and is continuous.

Planning and Goal Setting: Once benchmarking has been carried

out, goals and performance metrics are set in order to improve
performance. These goals are new, more competitive targets for a
company but they must be achievable. If goals are unrealistic to
achieve teams become demotivated and goals are destined to
remain unfulfilled.

Encourage Ownership: When companies look at their processes

and metrics they need to ask hard questions to get all the answers
they need. This includes talking to everyone in the business and
understanding their roles. By asking these questions and gaining a
better understanding of everyone’s role, ownership for processes
and performance is encouraged. This means that employees will
take pride in their job and the work they do. This pride leads to
better performance and higher-quality end results.

Understand Your Companies Advantages: Benchmarking

identifies where your company is right now compared to where you
want it to go. If you are looking at improving any process in your
business, benchmarking is a way of looking at how you can excel
and become more successful through outlining the steps needed to
achieve your goal.
Steps of Benchmarking
Step 1: Determine processes to be benchmarked.
Step 2: Determine organizations to be benchmarked.
Step 3: Gather data.
Step 4: Locate deficiencies.
Step 5: Determine future trends.
Step 6: Reveal results and sell the process.
Step 7: Achieve consensus on revised goals.
Step 8: Establish procedures.
Step 9: Implement procedures and monitor results.
Step 10: Recalibrate benchmarks.

Benchmarking of Royal Enfield

Brand was in the year 1893, the company is the oldest motorcycle
manufacturer in the world that still produces motorcycles. Royal
Enfield's flagship model, the Standard 350 is the unbeaten
champion when it came to long distance touring. The right side
gear-shift and left side brake limited the motorcycle from being
bought by everyone, which is the unique feature of the motorcycle.
The weight of the motorcycle or the sluggish power delivery is not at
all a bother because they were really smooth and felt like they were
made to take on highways. In 1994, the company introduced a 500
cc version of the Standard which many individuals took to their
liking, those who wanted to express themselves on the highways.
Motorcycles are still being made and the company shows no signs of
slowing down. Royal Enfield is a unique brand and it believes in
being disruptive.
Reference
 https://www.thehindu.com/business/Industry/royal-enfield-is-a-unique-brand-and-it-
believes-in-being-disruptive/article8332100.ece
 https://www.slideshare.net/AnupBali/royal-enfield-management-of-technology
 https://auto.ndtv.com/compare-bikes/royal-enfield-classic-350-1174-vs-tvs-apache-rtr-180-
1145-vs-bajaj-pulsar-200-ns-1032