Benchmarking may be used to compare a particular aspect of an organization's activities against the best in the class, or it may look at the organization's overall performance against the best performers. So, for example, benchmarking may be used to compare an organization's total quality management, or its system of distribution of goods or services, with those organizations which are the best performers in these areas.
It is the process of learning, adapting, and measuring outstanding practices and processes from any organization to improve performance.
- Identify opportunities to improve performance,
- Learn from others’ experiences,
- Set realistic but ambitious targets,
- Uncover strengths in one’s own organization,
- Better prioritize and allocate resources. When not to Benchmark
- Target is not critical to the core business functions,
- Customer’s requirement is not clear,
- Key stakeholders are not involved,
- Inadequate resources to carry through,
- No plan for implementing findings,
- Fear of sharing information with other organizations.