ccccEnvironment is changing rapidly due to global competition around the world.

An
organization has to make aware with new trends to adopt change to be update so bench
marking is playing crucial role for improved performance to the best in class enterprises. It is
a continuous process of comp airing enterprises strategy. In other words, ³It is moving from
where we are to where we want to be."

The concept of benchmarking in spite of the fact that every enterprise is virtually interested in
this phenomenon. Benchmarking defined as "Measuring our performance against that of best
in class companies, determination how the best in class achieve that performance level and
using the information as a basis for our own company's targets strategies and
implementation."

The best practices are approaches to get inspectional results for the use of innovative
technologies or human resources. Benchmarking has unique dimensions such as help in
reducing uncertainty, promoting board dialogue deals with best practices allows learning
from enterprises of others and results in the best practices which creates opportunities for all.

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 is the process of comparing one's business processes and performance
metrics to industry bests and/or best practices from other industries. Dimensions typically
measured are quality, time and cost. Improvements from learning mean doing things better,
faster, and cheaper.
Benchmarking involves management identifying the best firms in their industry, or any other
industry where similar processes exist, and comparing the results and processes of those
studied (the "targets") to one's own results and processes to learn how well the targets
perform and, more importantly, how they do it.
The term benchmarking was first used by cobblers to measure people's feet for shoes. They
would place someone's foot on a "bench" and mark it out to make the pattern for the shoes.
Benchmarking is most used to measure performance using a specific indicator (cost per unit
of measure, productivity per unit of measure, cycle time of x per unit of measure or defects
per unit of measure) resulting in a metric of performance that is then compared to others.

Also referred to as "best practice benchmarking" or "process benchmarking", it is a process

used in management and particularly strategic management, in which organizations evaluate
various aspects of their processes in relation to best practice companies' processes, usually
within a peer group defined for the purposes of comparison. This then allows organizations to
develop plans on how to make improvements or adapt specific best practices, usually with the
aim of increasing some aspect of performance. Benchmarking may be a one-off event, but is
often treated as a continuous process in which organizations continually seek to improve their
practices.

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The following is an example of a typical benchmarking methodology:

1.c 
cc c  - Because benchmarking can be applied to any business
process or function, a range of research techniques may be required. They include:
informal conversations with customers, employees, or suppliers; exploratory
research techniques such as focus groups; or in-depth marketing
research, quantitative research,surveys, questionnaires, re-engineering analysis,
process mapping, quality control variance reports, or financial ratio analysis. Before
embarking on comparison with other organizations it is essential that you know your
own organization's function, processes; base lining performance provides a point
against which improvement effort can be measured.
2.c 
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 cc c c   - For instance if one were
interested in improving hand offs in addiction treatment he/she would try to identify
other fields that also have hand off challenges. These could include air traffic control,
cell phone switching between towers, transfer of patients from surgery to recovery
rooms.
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c  c  - Look for the very best in
any industry and in any country. Consult customers, suppliers, financial analysts,
trade associations, and magazines to determine which companies are worthy of study.
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c  - Companies target specific business
processes using detailed surveys of measures and practices used to identify business
process alternatives and leading companies. Surveys are typically masked to protect
confidential data by neutral associations and consultants.
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Companies typically agree to mutually exchange information beneficial to all parties
in a benchmarking group and share the results within the group.
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c  - Take the leading edge practices
and develop implementation plans which include identification of specific
opportunities, funding the project and selling the ideas to the organization for the
purpose of gaining demonstrated value from the process.
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 - the initiating firm focuses its observation and investigation of
business processes with a goal of identifying and observing the best practices from one or
more benchmark firms. Activity analysis will be required where the objective is to
benchmark cost and efficiency; increasingly applied to back-office processes where
outsourcing may be a consideration.
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 - performing a financial analysis and comparing the results in
an effort to assess your overall competitiveness and productivity.
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 c   - extending the benchmarking universe to
also compare to peer companies that can be considered alternative investment
opportunities from the perspective of an investor.
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 - allows the initiator firm to assess their competitive
position by comparing products and services with those of target firms.
·c c
 
 - the process of designing new products or upgrades to current
ones. This process can sometimes involve reverse engineering which is taking apart
competitors products to find strengths and weaknesses.
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 - involves observing how others compete. This type is usually
not industry specific, meaning it is best to look at other industries.
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c
 
 - a company will focus its benchmarking on a single function
to improve the operation of that particular function. Complex functions such as Human
Resources, Finance and Accounting and Information and Communication Technology are
unlikely to be directly comparable in cost and efficiency terms and may need to be
disaggregated into processes to make valid comparison.
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 - involves studying the leading competitor or the company
that best carries out a specific function.
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 - embraces everything from staffing and productivity to
office flow and analysis of procedures performed.[4]
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 - developing an accurate model of a building's energy
consumption with the purpose of measuring reductions in usage.
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There are many benefits of benchmarking. The following list summarises the main benefits:

uc provides realistic and achievable targets

uc prevents companies from being industry led
uc challenges operational complacency
uc creates an atmosphere conducive to continuous improvement
 uc allows employees to visualise the improvement which can be a strong motivator for
change
uc creates a sense of urgency for improvement
uc confirms the belief that there is a need for change
uc Helps to identify weak areas and indicates what needs to be done to improve.

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uc Identifying areas for improvement

uc Identifying risks
uc Fuelling continuous improvement
uc _roducing specific, objective, measurements
uc Satisfying audit, compliance and the regulator
uc Monitoring and reviewing progress
uc Improving quality


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A major limitation of benchmarking is that while it helps organizations in measuring the

efficiency of their operational metrics, it remains inadequate to measure the overall
effectiveness of such metrics. Benchmarking reveals the standards attained by competitors
but does not consider the circumstances under which the competitors attained such standards.
If the competitor¶s goals and visions were flawed or severely restricted due to some specific
factor, an organization by benchmarking such standards runs the risk of trying to ape such
flawed standards or settling for extremely low standards.

A bigger disadvantage of benchmarking is the danger of complacency and arrogance. Many

organizations tend to relax after excelling beyond competitors' standards, allowing
complacency to develop. The realization of having become the industry leader soon leads to
arrogance, when considerable scope for further improvements remains.

Finally, many organizations make the mistake of undertaking benchmarking as a stand-alone

activity. Benchmarking is only a means to an end, and it is worthless if not accompanied by a
plan to change.

Comparing the pros and cons of benchmarking, the advantages of benchmarking overshadow
disadvantages. The 2008 Global Benchmarking Network survey finds organizations
preferring benchmarking over any other performance analysis tools, including SWOT. Most
organizations include benchmarking as a part of continuous improvement initiatives such as
Total Quality Management and Six Sigma

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Benchmarking is the general name given to a range of techniques which involve comparisons

between two examples of the same process so as to provide opportunities for learning.

Benchmarking can, for example, be used to compare how different companies manage the

product development processes; where one is faster than the other there are learning

opportunities in trying to understand how they achieve this. The approach has been widely

used ² for example, in the field of quality management where it is used to drive the

development of improvements in business performance, in software development and in

developing continuous improvement systems.

One of the best-known examples of benchmarking as a learning resource are the activities

within the International Motor Vehicle _rogramme, which has systematically collected and

exchanged information on nearly all car assembly plants in the world. It can show how

different plants are more or less effective on a range of measures ² and in doing so it focuses

the attention of other plant managers on how this is being achieved. It has acted as a

powerful catalyst for learning in that industry and the model of benchmarking has been

extended to other domains such as aerospace manufacturing and construction.

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In this process firms select examples of notional or actual µbest practice¶ and then compare

their performance with this. Benchmarks can be constructed along several dimensions of

performance ² quality, productivity, flexibility, customer service, etc. ² and comparisons

can be made with similar firms (in terms of size, sector and product/markets) or with

different ones but which are noted for world-class performance along a key dimension. The

underlying principle is one of auditing the strengths and weaknesses of the firm and

identifying the directions for future development of competitive advantage .

Benchmarking works in two ways to facilitate learning:

‡ It provides a powerful motivator since comparison often highlights gaps which ± if

not closed ± might well lead to problems in competitiveness later.

‡ It provides a structured way of looking at new concepts and ideas.

It can take several forms:

&c  - In which the comparison is made between how similar activities are carried
out within the same organization ² for example, who is the fastest at processing paperwork,
who has the lowest stock levels, who is most flexible, and how?


c  # In which the comparison is made between different divisions in an
organization doing the same basic processes.

 # In which the comparison is between different firms carrying out similar processes.
The car industry example is an illustration of this.

##
c
 
 In which a similar process is carried out indifferent sectors;
and in which there may best opportunities for learning. For example, SouthWest Airlines
became one of the most effective operators in the USA by reducing its turnaround times at
airport terminals. c