What exactly is benchmarking?
Benchmarking is a process that continuously searches for opportunities for improvement. This approach ensures that the company remains competitive. This means that the aim is to close any performance gap.
These comparisons were originally only made among the world’s large corporations, but benchmarking is now used regardless of company size and covers both services and production.
The question in benchmarking is: What are others doing and why are they more successful than your own company? Benchmarking can be used in almost all areas of the company, processes and procedures. Short for BM via abbreviationfinder, benchmarking is mainly used in the following areas:
- Sales force
- Logistics / materials management
- Service / customer service
Learn from comparison! – The comparison with the best!
To put it simply: Benchmarking means comparing the performance of your own company with those of the best and learning from it. To ensure that this succeeds, benchmarking consists of a total of four phases.
Anyone who wants to get to the top with their company is best geared to the success of others – because that has always proven itself. Therefore, the overriding principle of benchmarking is: learn from the best!
In benchmarking, one’s own products, processes, structures, activities, strategies, cultures, etc. are compared with those of the best in order to learn from them. This is achieved by identifying “best practices”, adapting them to your own needs and then implementing them. One of the most important principles is to establish benchmarking as a permanent process in the company in order to achieve long-term improvements in all areas and ultimately to be able to assert oneself in the competition.
In order for a company to be successful in the long term with benchmarking, it is necessary to let the concept become a permanent establishment. This means that benchmarking is carried out over and over again.
Benchmarking consists of four phases
A typical benchmarking project consists of four phases and how long a phase lasts, how high the resource requirements are and also the detailed planning takes time, this varies from project to project. Experience shows, however, that around five to 12 months should be planned for a complete benchmarking cycle.
Phase 1: Select the benchmarking objects
In this phase, your own company is first analyzed with the aim of selecting the strategically correct properties for the project. This means that the most important problem areas are identified, which are then to be improved with the help of benchmarking. These are mostly individual processes that are particularly important or products and services that need to be improved. The central question here is what should be benchmarked?
Phase 2: Select the benchmark
In this phase, one or more benchmarking partners are selected with whom the company can be compared and learned from.
- Internal areas of the company can be compared with one another.
- The company can be compared with competing companies.
- It is possible to compare companies with others that are world leaders in a certain process or method.
The central question here is who should the company be compared with?
Phase 3: conduct a study.
During this phase, the benchmarking partners are compared with one another. In doing so, performance gaps must be identified and the causes for them found out. The central question here: Where are the performance gaps to be found and why are they?
Phase 4: Implement the results.
This is the final phase of the benchmarking project. Now planning and the implementation of the measures derived from the study are being carried out. So the best practices of the benchmarking partners are introduced and the results are checked. A new benchmarking project can then be started.
The central questions in the fourth phase are:
- What should I do?
- How can the set goals be achieved?
- How should the knowledge gained be implemented in your own company?
So benchmarking is a complex system. In addition, benchmarking is one of the most effective ways when it comes to quickly integrating knowledge from outside into your own company. The reason is that the knowledge acquired as part of the benchmarking process is very practice-oriented and has proven to be effective in everyday life.
So much in theory. If benchmarking is practiced in practice, it is mostly reduced to individual key figures that are compared and thus often only represents a further development of the company comparison.