Types of Benchmarking

a.    Strategic Benchmarking involves examining long-term strategies (e.g. regarding core competencies, new product and service development, improving capabilities for dealing with change) used by successful high performers in order to improve a business’s overall performance.

b.    Performance or Competitive Benchmarking looks at performance characteristics in relation to key products and services in the same sector. In order to protect confidentiality this type of analysis is often undertaken through trade associations or third parties.

c.    Process Benchmarking focuses on improving critical processes and operations through comparison with best practice organisations performing similar work. This often results in short term benefits.

d.    Functional Benchmarking compares a business with partners drawn from different sectors to find innovative ways of improving work processes. This can lead to dramatic improvements.

e.    Internal Benchmarking involves benchmarking businesses or operations from within the same organisation (e.g. business units in different countries). Access to sensitive and/or standardised data is easier, usually less time and resources are needed and ultimately practices may be relatively easier to implement. However, real innovation may be lacking: best in class performance is more likely to be found through external benchmarking.

f.    External Benchmarking analyses best in class outside organisations, providing the opportunity to learn from those at the leading edge. This can take up significant time and resource to ensure the credibility of the findings.

g.    International Benchmarking identifies and analyses best practitioners elsewhere in the world, perhaps because there are too few benchmarking partners within the same country to produce valid results. Globalisation and advances in information technology are increasing opportunities for international projects. However, these can take more time and resources to set up and implement and the results may need careful analysis due to national differences.

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For more information on how we can help you with benchmarking your organisation, please call us 020 7654 5000 or contact us online.