By: Ekta Maurya

Swati Jain
T.C.Sri Lakshmi
BENCHMARKING
• The continuous process of measuring products, services, and

practices against the company’s toughest competitors or those

companies renowned as industry leaders

• Objectives:
• Establish credible goals

• Continuous improvement

• Benefit of Benchmarking:

Achieve performance levels that fully satisfy these ever-increasing

customer expectations
How Benchmarking is done

1. Establish that there is a need for change

Identifying gaps between the organization and the competition

2. Identify what should be changed

Understand how industry leaders do things

3. Create a picture of how the organization should look after the

change
Showing what is possible and what other companies have done

BENCHMARKING FUNDAMENTALS:
1. Know the operation
2. Know the industry leaders and competitors
3. Incorporate the best and gain superiority
 PHASES OF THE 10-STEP
BENCHMARKING PROCESS
Phase 1: PLANNING
 Decide what to benchmark
 Product/output

 Priority candidates to benchmark to improve performance

 Identify whom to benchmark

 Plan the investigation and conduct it

Collect data sources and observe best practices
Phase 2: ANALYSIS
 Understanding internal business processes

 Examine best practices of other org.

 Measure the gap

 Project future performance

Phase 3: INTEGRATION
 Redefine goals and incorporate them

 Communicate benchmarking finding and gain acceptance

 Target and strategy should be updated

Phase 4: ACTION
 Best practices are implemented

 Periodically recalibrate

 Monitor progress
Phase 5: MATURITY
 Determine when leadership position is attained

 Standard part

 Performance levels improving

 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 1: What to benchmark
1. Identify product/output

2. Develop a clear mission statement

3. The broad functions are broken down into specific outputs

4. Specific outputs are documented in detail for comparison

 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 2: Whom to benchmark
Identifying leading competitors which possess the best practices

 Internal Benchmarking
 Comparison of practices among similar operations within a firm

 Benefit: Force documentation and allows easy comparison

 Competitive Benchmarking
 Comparison to the best direct competitors

 Ways: Public Domain, Direct Benchmarking Exchange & Joint study by

3rd party

 Functional Benchmarking
 Comparison of functional activities even in dissimilar industries
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 3A: Collect Data
Information Sources:

1. Internal
Search of everything published on the topic during the last 5 years in a
public domain

2. External
Information from professionals, seminars, lectures etc.

3. Original
Contact Benchmarking partners directly and collect information using
questionnaires
Step 3B: Conduct site visit
Prepare questionnaire  Outside consultant can be used (little
organizational learning and little
Prioritize topics ownership in findings)

 Rule of thumb: 70/30; 70% studies

Identify Benchmarking
Site Visit Team done internally, 30% done externally

Benchmarking
Protocol

Site Visit

Site Visit Report

 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

 Step 4: Analyse the performance
gap

1. Analyse information collected

2. Indentify gaps and performance

3. Measure of superiority
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 5: Project Performance Levels
Decide improvements :

Projections in (i)Current process

(ii)After benchmarking
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 6: Communicate Findings

1. Decide who needs to know

2. Select best presentation vehicle

3. Organize findings

4. Present recommendations
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 7: Establish Functional Goals
1. Revise goals

2. Impact on others

3. Management approval
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 8: Develop action plan
 Step 8: Develop action plan

1. Set implementation priorities

2. Show revisions to performance gap

3. Develop action plans

 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 9: Implement Plan and
monitor results
1. Best practices

2. Pilot best practice before implementation

3. Efficiency measures
 STEP 1: WHAT TO BENCHMARK

STEP 2: WHOM TO BENCHMARK

STEP 3A: COLLECT DATA

STEP 3B: CONDUCT SITE VISIT

STEP 4: ANALYSE THE PERFORMANCE GAP

STEP 5: PROJECT PERFORMANCE LEVELS

STEP 6: COMMUNICATE FINDINGS

STEP 7: ESTABLISH FUNCTIONAL GOALS

STEP 8: DEVELOP ACTION PLAN

STEP 9: IMPLEMENT PLAN & MONITOR RESULTS

STEP 10: RECALIBRATE BENCHMARKS

Step 10: Recalibrate Benchmarks
 Step 10: Recalibrate Benchmarks

1. Benchmarks must be planned and recalibrated

2. Complete reassessment (1-3 years)

Conclusion
 Behavioral benefits

 Learning experience

 Focus for consensus on needs

 Stimulus for improvement

 Competitiveness

 Improved competitiveness

 Increased value in the eye of customers

 Superior customer service levels

 Increased market share

 Improved financial results

Thank You!!