By Anthony Cappucci David Silva









Benchmarking is the process of comparing and measuring an organization’s operations or its internal processes against those of a best-in-class performer from inside or outside its industry. Process benchmarking is a systematic and continuous improvement process; a process of continually MEASURING and COMPARING an organization’s BUSINESS PROCESSES against business pro LEADERS anywhere in the world to gain INFORMATION which will help the organization take ACTION to IMPROVE its 4 PERFORMANCE.

Key Points
• Benchmarking is an increasingly popular improvement tool. • Benchmarking concerns processes and practices. • Benchmarking is a respected means of identifying processes that require major change. • Benchmarking is done between consenting companies that may or may not be competitors. • Benchmarking compares your process or practice with the target company’s best-in-class process or practice. • The goal of benchmarking is to find “secrets of success” and then adapt and improve for your own application.

Benchmarking as it Relates to Continuous Improvement
• Today’s competitive world does not allow time for gradual improvement in areas in which a company lags way behind. • Benchmarking can tell a firm where it stands relative to best-in-class practices and processes, and which processes must be changed. • Benchmarking provides a best-in-class model to be adopted, or even improved upon. • Modern customers are better informed and demand the highest quality and lowest prices. Companies have a choice to either perform or go out of business. • Benchmarking supports total quality by providing the best means for rapid, significant process/practice improvement.

Benchmarking Approach and Process
1. Obtain management commitment. 2. Baseline your own processes. 3. Identify your strong and weak process and document them. 4. Select processes to be benchmarked. 5. Form benchmarking teams. 6. Research best-in-class. 7. Select candidate best-in-class benchmarking partners. 8. Form agreements with benchmarking partners. 9. Collect data. 10. Analyze data and establish the gap.

11. 12. 13. 14. Plan action to close the gap/surpass. Implement change. Monitor. Update benchmarks; continue the cycle.


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Your Process

Benchmark Process


Time of Benchmark (Negative Gap)

Gap Eliminated Time Benchmark Surpassed (Positive Gap)

Implemented New Process

Effect of Benchmarking Process Change Followed by Continuous Improvement

Benchmarking Versus Re-Engineering
Process re-engineering should only be considered when it is impossible to use benchmarking.
• No known process available for benchmarking (rare). • Best-in-class not willing to partner. • Best-in-class inaccessible due to geography or expense.


Role of Management in Benchmarking
• For benchmarking to be productive, management must be committed to change. • Management must provide the necessary funding. • Management must allocate the appropriate personal. • Information to be disclosed to benchmarking partners can only be cleared by management. • Top level managers must themselves be directly involved in benchmarking activities.

Processes Documented
• All people associated with the process should have a common understanding of it, and that can come only from documentation. • A documented starting point is needed against which to measure performance improvement after benchmarking changes have been implemented. • The organization will be dealing with people (the partners) who are not familiar with its processes. With an understanding of where the benchmarking organization is, the partner will be better able to help.

Settling for “OK-in-Class”
Reasons organizations too often choose benchmarking partners who are not best-in-class.
• The best-in-class is not interested in partnering. • Research identified the wrong partner. • The benchmarking company got lazy and picked a handy partner.


Obstacles to Successful Benchmarking
• If a company is too internally focused it may not be aware that their processes are less efficient than best-in-class. • An overly broad benchmarking objective can guarantee failure. • Unrealistic timetables. • Poor team composition--the people who use the process day in and day out, must be involved. • Improper emphasis--A frequent cause of failure in benchmarking is that teams get bogged down in collecting endless data and put too much emphasis on the numbers. • Insensitivity to partners--If you fail to observe protocol and common courtesy in all transactions, your organization runs the risk of being cut off.


• Xerox’s success is the first one in the history of benchmarking. • From a critical situation in 1972, Xerox became what we call today a “top benchmarking partner”. • In 1979, Xerox starts benchmarking. • In 1989, Xerox wins the Malcolm Baldrige National Quality Award.

The Next Slide Illustrates Xerox’s Results

• Product performance during the first 30 days of installation has increased 40% • Manufacturing lead times have been reduced 50%. • Manufacturing labor and material over-head rates have been improved by 31% and 46% respectively. • Customer retention rate is 20% better than U.S. industry average.

Xerox Now Has:
• A company wide performance measurement covering 240 key areas of product, service and business performance. • The targets of world leaders. • Tremendous gains in quality (78% defect reduction, increased reliability with 40% decrease in unscheduled maintenance, increased copy quality, 27% decrease in service response time). • Significant reductions in labor and material overheads. • First company to offer three year product 17 warranty.

Quality Function Deployment (QFD)


QFD is a practice for designing your processes in response to customer needs. QFD translates what the customer wants into what the organization produces. It enables an organization to prioritize customer needs, an improve processes to maximum effectiveness. QFD is a practice that leads to process improvements that enable an organization to exceed the expectations of the customer.


Identify trade-offs relating to the manufacturing requirements Manufacturer's current requirements/specifications to suppliers


1 4

3 PLANNING MATRIX ·Importance Rating. ·Competition Rating. ·Target Values. ·Scale-up Needed. ·Sales Point.
Planning Weight (Calculated)


What do the customer requirements mean to the manufacturer? Where are the interactions between relationships?

Prioritized List of Manufacturer's Critical Process Requirements


QFD Matrix Structure

QFD Process: One Complete Cycle
T e c h n ic a l F e a t u r e s C u s t o m e r R e q u ir e m e n t s T e c h n ic a l F e a t u r e s A p p lie d T e c h n o lo g ie s M a n u fa c t u r in g P r o c e s s e s Q u a lit y C o n t r o l P r o c e s s e s S t a t is t ic a l P r o c e s s C o n t r o l M A T R IX 1 A p p lie d T e c h n o lo g ie s M A T R IX 2 M a n u fa c t u r in g P r o c e s s e s M A T R IX 3 Q u a lit y C o n t r o l P r o c e s s e s M A T R IX 4 S t a t is t ic a l P r o c e s s C o n t r o l M A T R IX 5 S p e c ific a t io n s fo r t h e F in is h e d P r o d u c t M A T R IX 6

Benefits of QFD
• Customer-focused. A total-quality organization is a customer-focused organization. • Time-efficient. QFD can reduce development time because it focuses on identified customer requirements. • Teamwork -orientated. All decisions in the process are based on consensus and involve in-depth discussion and brainstorming. • Documentation-orientated. One of the products of the QFD processes a comprehensive document that pulls together all pertinent data about all processes and how they stack up against customer requirements.


Characteristics of Customer Information



Characteristics of Customer Information





Basic QFD Tools
Matrix Diagram

Tree Diagram Interrelationship Digraph

Affinity Diagram


Creating an Affinity Diagram: Collecting Information on Why a Engineering Textbook is Not Selling
1. A team of employees familiar with the issue is formed. 2. The issue to be discussed is stated without detail. “Why does our engineering text book not sell better?” 3. Responses of participants are stated verbally and recorded on 3 by 5 cards. 4. The cards are spread on a large table, and participants are asked to group cards containing related ideas. Cards that don’t fit any particular group can be grouped as miscellaneous. 5. Participants try to find a heading that describes each group. 6. The information on the cards is replicated on paper with 25 boxes around each group of ideas.

Affinity Diagram Example: Poor Sales Figures on an Engineering Textbook
ARTWORK ISSUES Drawings not produced on CAD system. Too simple. Not enough complex examples. Drawings do not comply with ANSI standards. Not enough variety. No color photos. Poor drawing package. PEDAGOGICAL ISSUES Too limited in scope of coverage. No chapter objectives. No chapter summaries. PRODUCTION ISSUES Poor registration on drawings. Screens too dark. Page count too low. WRITING ISSUES Reading level too high. Writing style complex.

Writing style among co-authors inconsistent. Key terms. Paperback cover. Too few subheadings. Superficial review Sloppy production. Paragraphs too questions. long. No design projects. Poorly written.


Interrelationship Digraph
1. Write the problem statement on a 3 by 5 card. Continuing the example of poor sales figures, write this on a card and designate it as the problem statement by enclosing it in a double line.


Poor Sales Figures



Interrelationship Digraph Continued
2. Place the problem statement card in the upper left corner of a table. Take out all the cards used to develop the Affinity diagram and lay them on the table. Place the card most closely associated with the problem closest to the problem card. Continue on with the next closest until cards are used up. 3. When the cards are all laid out, recreate them on paper. Distribute copies of the paper to the group for discussion. The group then makes a final arrangement. 4. Distribute the final version to participants and ask them to draw arrows showing what contributes to what. This is the step in which relationships between and among causes are established.

Interrelationship Digraph (Partial)

Poor Drawing Package

Drawings Do Not Comply with ANSI

Drawings Not Produced on CAD System

Poor Sales Figures

Insufficient Variety of Drawings

Sloppy Production

Poor Registration on Drawings

Screens on Drawings Too Dark


Tree Diagram
1. Clearly identify the problem to be solved. It can be taken from the affinity diagram or from the interrelationship digraph.. Write it on a card and place it on the left side of a table. 2. Conduct a brainstorming session in which participants record on 3 by 5 cards all possible tasks, methods, and activities relating to the problem. Repeat the question “In order for this to happen, what must happen first?” Continue until all ideas are exhausted. 3. Lay all cards on table to the right of the problem card. Put them in order based on what must happen first. 4. Duplicate the cards on paper and distribute copies to all participates. All participates are to revise and correct the document.


Tree Diagram (Partial)
Produces drawings on a modem CAD system Identify CAD Contractor Contract with a CAD company Contract with ANSI Specialist to Check Sketches Identify 50 Complex Drawings Available From Industry

Create a Quality Artwork Package

Comply with Latest ANSI

Require Authors to Submit Sketches that Comply Require Authors to Submit Sketches that Comply

Increase Number of Complex Drawings

Poor Sales Figures Increase Variety of Drawings Require Authors to Submit Sketches According to a prescribed Variety Formula Add Objectives, Summaries, Key Terms, and Design Projects

Revise Standard Chapter Format

Rewrite Review Questions to Give Them More Depth

Improve Pedagogical Features

Broaden Scope of Coverage

Add Chapters on Automated Manufacturing, Visualization for Solid Modeling, and Descriptive Geometry

Improve Support Material

Add a Comprehensive Glossary


Matrix Diagram
• It is a helpful tool for identifying and graphically displaying connections (seen as intersections on the diagram) among responsibilities, tasks, functions, and so forth.


L-Shaped Matrix: Improving Sales Figures






Produce New Drawings On a CAD System Bring Drawings into ANSI Compliance Add Color Photos Add Chapter Objectives Summaries, Key Terms Correct Registration on Drawings Lighten Screens on Drawings

1 3 1 -

1 2 1 2 2

2 2 2 1 1


1 = Primary Responsibility 2 = Secondary Responsibility 3 = Tertiary Responsibility

Implementing QFD
Train the Team Conduct a “Kick Off” Meeting Select a Project Establish Monitoring Procedures Form the Project Team

Develop the Matrices


Implementing QFD
• Form the Project Team. The nature of the project will dictate the makeup of the project team. Will the team Improve a product or develop a new one? The team should consist of personal from marketing, engineering quality, and manufacturing. If a new product is being developed market research and development personal should be there. • Establish Monitoring Procedures. Three questions must be answered: What will be monitored? How will it be monitored? How often will it be monitored?

• Select a Project. It is a good idea to begin with an improvement project. Team members who are not familiar with QFD are at least familiar with the product. • Conduct a “Kick-Off” Meeting. 1. Make sure all participants understand the mission of the project team. 2. Make sure all participates understand their role on the the team. 3. Establish parameters - (length, time, and frequency of meeting). • Train the Team. Team members should learn how to use QFD tools and how the QFD process works. • Develop the Matrices.

Continuous Improvement

Several different approaches


Management’s role in Continuous Improvement
Joseph Juran

Establish an organization-wide quality council Establish specific quality improvement goals with timetables and target dates Provide support Schedule periodic reviews


Structure for Quality Improvements
Establish a quality Council Develop a statement of responsibilities Establishing the necessary infrastructure


Essential Improvement Activities
Communicate Correction Obvious Problems Find causes Documentation Monitor changes


The Scientific Approach
Collect meaningful data Identify root causes of problems Develop appropriate solutions Plan and make changes


Identification of Improvement needs
Apply multi voting Identify customer needs Study the use of time Localize problems


Development of Improvement Plans
Understand the process Eliminate errors Remove slack Reduce variation Plan for continuous improvement


Common Improvement Strategies
Eliminate Variation Streamline the Process Eliminate Errors in the Process Standardize the Process

Improve the Design
Get the process in statistical control

Describe the Process


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