Benchmarking Tool Analysis
The definition of benchmarking is the process of making comparisons in order to learn from Best Practices. When an organization compares its performance with other similar organizations they can identify those companies that have a comparatively high performance rating. From this an organization can learn how to achieve such a high level of performance.
Benchmarking started in the corporate sector when Xerox Corporation realized it was losing a lot of money and its market share to Japanese competitors. These competitors were able to sell a product for the same price that it cost Xerox to make. Benchmarking was started by Xerox's Manufacturing unit when it compared its photocopier manufacturing process to Fuji-Xerox. This is a very famous study that became part of the first book on Benchmarking by Camp. The book was not published until 1989, but meanwhile, benchmarking was becoming indoctrinated into the Xerox system of operations. Even so, most people still had never heard of benchmarking.
Benchmarking is a part of a Total Quality Program (total quality), and one of the purposes of total quality is to improve the way a company does business. This could be through improved customer service or increased quality of a product. Benchmarking means to adopt another's Best Practices as your own. It is not a one time fix, but rather a process that should be applied periodically to monitor the initial improvement progress, then as often as needed to ensure the processes in place are still considered best practices, which as with most things will continually evolve. Benchmarking should be used when making decisions on streamlining processes or to cut overhead costs. It should not be used when an improvement to ...