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Outline
Benchmarking Meaning
Benchmarking Definition
Benchmarking features & concept.
Why Benchmarking?
Benchmarking advantages & Disadvantages
Benchmarking Process
Benchmarking Types
What is Benchmarking?
At its simplest, benchmarkingmeans:
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WHAT IS BENCHMARKING?
Benchmarking is the process of improving
performance by continuously identifying,
understanding, and adapting outstanding
practices found inside and outside the
organization.
M i ni ng Industr y
C o mp a n y P C o mp a n y R
Company S
C o mp a n y A
C o mp a n y C
C o mp a n y B
Co. D
Client
C o mp a n y T
C e m e n t Industr y C o mp a n y U
What is Benchmarking?
Benchmarking is the process of comparingone's
business processes and performance metrics to
industry bests and/or best practices from other
industries.
Why are others better ?
How are others better ?
What can we learn ?
Company C
Company A
Company B
How can we catch up ?
Client
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How can we become the
Co
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Competitive
Discovering Core Advantage
Gained through
Competencies Core Competencies
Strategic
Competitiveness
Discovering Above-Average
Core Returns
Competencies
Core
Competencies
Sources of
Competitive
Advantage
Continuous
Improvement
Breakthrough
Improvement
Continuous
Improvement
Time
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Outline
Benchmarking Meaning
Benchmarking Definition
Benchmarking features & concept.
Why Benchmarking?
Benchmarking advantages & Disadvantages
Benchmarking Process
Benchmarking Types
Why Benchmarking?
Traditional performance improvement trends
seem not to be sufficient for the highly
competitive markets. In other words external
environment and market conditions change
rapidly
Customers’ expectations are highly liquid and are
driven by standards set by best performer. Any
product or service just below thesestandards may
not catch the eyes of customer.
Prevents the “Re-inventing the wheel”.
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Why Benchmarking?
Benchmarking gives us the chance of gaining:
Better Awareness of Ourselves(Us)
What we are doing
How we are doing it
How well we are doing it
Better Awareness of the Best(Them)
What they are doing
How they are doing it
How well they are doing it
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Why Benchmark
Benchmarking is a more efficient way to make
improvements. Managers can eliminate trials and
errors.
Benchmarking speeds up organization’s ability to
make improvements. Today, time is of the
essence.
Benchmarking has the ability to bringyour
performance up as a whole significantly.
Learn from others’ experiences
Set realistic but ambitious targets
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Outline
Benchmarking Meaning
Benchmarking Definition
Benchmarking features & concept.
Why Benchmarking?
Benchmarking advantages & Disadvantages
Benchmarking Process
Benchmarking Types
THREE MAJOR ADVANTAGES OF
BENCHMARKING
Product and Process Improvement:
By implementing benchmarking activity,
organizations can improve their operation process
Time & CostReduction:
Bench marking is time and cost efficient because it
involves imitation and adaptation r at her t h a n pure
invention.
Competitive Strategy
By implementing benchmarking activity,
organizations can improve their operation process.
Competitive Strategy
Build core competencies that will help to sustain
competitive advantage
Access to a variety of markets
Perceived benefit of product or service will increase
Product or service is hard to imitate
Low-cost leader
Target specific shift in strategy
Entering new markets
Developing new products
To create a firm more adaptable to change
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Disadvantages
What is best for someone else may not suityou
Poorly defined benchmarks may lead to wasted
effort and meaningless results.
Incorrect comparisons
Reluctance to shareinformation
23
Dr. Zargari
Outline
Benchmarking Meaning
Benchmarking Definition
Benchmarking features & concept.
Why Benchmarking?
Benchmarking advantages & Disadvantages
Benchmarking Process
Benchmarking Types
1. IDENTIFY WHAT IS TO BEBENCHMARKED
A BENCHMARKING PROCESS
8. DEVELOP ACTIONPLANS
MATURITY • LEADERSHIPPOSITIONATTAINED
• PRACTICESFULLYINTEGRATEDINTO
PROCESS
PLANNI NG
We s t a r t plan ning by
identifying t h e area to
bench m a r ked.
Company B
Company A
Co. D
Client
Cement Industry
INTERPRETATI ON
Thebenchmarking process
must be used continuously to
pursue emerging new ideas
Outline
Benchmarking Meaning
Benchmarking Definition
Benchmarking features & concept.
Why Benchmarking?
Benchmarking advantages & Disadvantages
Benchmarking Process
Benchmarking Types
Types of Benchmarking
On the basis of “What” is being compared with
other organizations and “Who” is being compared
with our organization, we can classify
benchmarking.
“What” isbeing
Who” is being
compared with
other
vs. compared with
our organization
organizations
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Types of Benchmarking
On the basis of “What” is being compared with
other organizations we have four maintypes.
These four major types of benchmarkingare
evolutionary beginning with product, throughto
functional (performance), process and strategic
benchmarking.
Strategic
Process
Performance
Product
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Types of Benchmarking
On the basis of “Who” is being compared with our
organization, we have these categories:
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Thank
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