marketing related

2. What is Benchmarking?
Benchmarking is the process of
measuring an organization’s internal processes
then identifying, understanding, and adapting outstanding practices
from other organizations considered to be best-in-class.

3. What is Benchmarking?
• Learning from others what they do right
and then imitating it to avoid “reinventing
the wheel”

4. “Benchmarking is the practice of being
humble enough to admit that someone
else is better at something and wise
enough to try and learn how to match and
even surpass them at it.”
- APQC, 1998
BENCHMARKING THOUGHTS

5. DIAGRAM OF BENCHMARKING
CONCEPT
What is our performance
level? How do we do it?
What are others’
performance levels? How
did they get there?
Creative
Adaptation
Breakthrough
Performance
Figure 8-1 Benchmarking Concept (pg. 208)
Reprinted with the permission of the Institute of Industrial Engineers, 3577 Parkway Lane, Suite 200,
Norcross, GA 30092, 770-449-0461. Copyright © 199

6. KEY ELEMENTS
 Measuring using metrics
- Expressed numerically, with target in mind

7. KEY ELEMENTS
 Recognizing differences in processes
- Need to thoroughly understand their own
processes as well as those of the
best in class’s company

8. KEY ELEMENTS
 Comparing self to external competition
- Reduces chance of being caught off guard
- Encourages competition
- Personnel more motivated to attain goals

9. KEY ELEMENTS
 Comparing self to external competition
- Reduces chance of being caught off guard
- Encourages competition
- Personnel more motivated to attain goals

10. KEY ELEMENTS
 Imitation/Adaptation vs. Invention
- Provides a working model
on an improved process

11. KEY ELEMENTS
 Continuous Improvement
- Technologies and ideas become obsolete;
businesses need to keep abreast
of what is current
- Some benchmarking may need to be done
continually

12. FARZANA SULEMAN
ROLL NO. MS13-IBF-16

13. WHY USE BENCHMARKING
 Survival lies in following best and not in lagging behind.
 Bench marking is time and cost efficient because it involves
imitation and adaptation rather than pure invention. Prevents
the “Re-inventing the wheel”.
 For Quantum-leaps in performance
 To identify opportunities to improve performance
 To learn from others’ experiences
 To facilitate cultural changes
 To set realistic but ambitious targets
 To uncover strengths in one’s own organization
 Better prioritize and allocate resources

14. WHY USE BENCHMARKING
• An effective ‘wake-up call’ and helps to make a
strong case for change
• Practical ways in which step changes in
performance can be achieved by learning from
others who have already undertaken comparable
changes
• The impetus for seeking new ways of doing things
and promotes a culture that is receptive to fresh
approaches and ideas
• Opportunities for staff to learn new skills and be
involved in the transformation process from the
outset.

15. WHEN NOT TO BENCHMARK
 Target is not critical to the core business
functions
 Customer’s requirement is not clear
 Key stakeholders are not involved
 No plan for implementing findings
 Fear of sharing information with other
organizations

16. BENCHMARKING PROCESS
Planning
Collecting
Data
Analysis
Improving
Practices

17. 1. PLANNING
 Determine the purpose and scope of the
project
 Select the process to be benchmarked
 Choose the team
 Define the scope
 Develop a flow chart for the process
 Establish process measures
 Identify benchmarking partners

18. 2. COLLECTING DATA
 Conduct background research to gain
thorough understanding on the process
and partnering organizations
 Use questionnaires to gather information
necessary for benchmarking
 Conduct site visits if additional
information is needed
 Conduct interviews if more detail
information is needed

19. 3. ANALYSIS
 Analyze quantitative data of partnering
organizations and your organization
 Analyze qualitative data of partnering
organizations and your organization
 Determine the performance gap

20. 4. IMPROVING PRACTICES
 Report findings and brief management
 Develop an improvement implementation
plan
 Implement process improvements
 Monitor performance measurements and
track progress
 Recalibrate the process as needed

21. Specific steps of Benchmarking vary from
company to company but the fundamental
approach is same . One company’s
benchmarking may not work at another
orgnaization due to differing operating concerns

22. MOTOROLLA INC.’S BENCHMARKING MODEL
1. Decide what to Benchmark
2. Select companies to benchmark
3. Obtain data and collect information
4. Analyze data and form action plans
5. Recalibrate and start the process again

23. AT&T’S BENCHMARKING MODEL
1. Decide what to Benchmark
2. Develop a Benchmarking plan
3. Select a method to collect data
4. Collect data
5. Select companies to Benchmark
6. Collect data during site visit
7. Compare processes ,identify gaps, make
recommendations,
8. Implement recommendations
9. Recalibrate Benchmark

24. THREE TYPES OF GAPS
 Negative
 Parity
 Positive

25. TYPES OF BENCHMARKING
 Internal benchmarking
 External benchmarking
 Functional benchmarking:

26.  LUBNA KANWAL

27. INTERNAL BENCHMARKING
sharing opinions
between
departments
within the same
organisation
ADVANTAGES:
 Easier to implement
 Easier to access data
DISADVANTAGES:
 External ideas blocked

28. EXTERNAL BENCHMARKING
 Comparison with
external organisations
to discover new ideas,
methods, products and
services.
 The gap between
internal and external
practices displays the
way where to change
and if there is any
need to change.
Advantages
 Helps to measure
one’s own
performance
 Helps to search for
best practices
Disadvantages
 Takes time
 Requires support
 Legal/ethical isssues
 Industrial espionage

29. FUNCTIONAL BENCHMARKING:
Comparative
research to seek
world-class
excellence by
comparing business
performance not
only against
competitors but also
against the best
businesses operating
in different industry
Advantages:
 Discovering innovative
practices
Disadvantage:
 Not suitable for every
organisation

30. OTHER TYPES OF BENCHMARKING
 Product Benchmarking
 Process Benchmarking
 Strategic Benchmarking
How companies compete, identify the winning strategies
that have enable high-performing companies to be
successful in their marketplaces.
 Parameter Benchmarking

31. GAP ANALYSIS (SPIDER CHART)
Current performance of the host
Current performance of the partner
Current
performance of
the host for
variable ‘K’.
Best of the best
(current
performance of
the partner for
variable ‘A’.
Total customer
satisfaction

32. – Clearly defined purpose
– Continual analysis & reassessment
– BM methodology must be
appropriate
– Significance of results must be clear
– Conclusions must be justified by the
data
– Never compromise integrity for the
sake of findings
BENCHMARKING ESSENTIALS

33. BENCHMARKING ESSENTIALS
 Investigation must be systematic
 A high code of ethics is essential
 Successful benchmarking requires a
planned approach
 Requires senior management
commitment
 Must establish & enforce milestones
 Must report findings to senior
managment

34.  Internal training for company
personnel
 Access to a benchmarking database
 Professional BM analysts to support
studies
 The process must be institutionalized!
BENCHMARKING ESSENTIALS

35.  MEHVISH AMIN

36. 1. Fear of being seen as “copying”
2. Fear of losing competitive advantage by
sharing information
3. Arrogance – “we are the best, why
benchmark?”
4. Benchmarking trap – benchmark that
which is convenient, but may not be
important.
Adapted from Watson 1992
BARRIERS TO BENCHMARKING

37. 5. Impatience – “A quintessential trait”
6. Excuses are too easy:
– We are too small
– We are too busy
– We are too different
– Nobody else does what we do
– We do it better than anyone else
Adapted from Watson 1992
BARRIERS TO BENCHMARKING

38. 1. Key is to “Adapt not adopt” – Deming
2. Benchmarking does not come as a natural
process for many – competitiveness does,
but not benchmarking, because
benchmarking requires a team approach.
BENCHMARKING OBSERVATIONS

39. LEGAL & ETHICAL GUIDELINES
 Keep it legal;
 Be willing to give what you get;
 Respect confidentiality;
 Keep information internal;
 Use benchmarking contacts;

40. EXAMPLRY SPIDER CHART
FOR BENCHMARKING

42. POTENTIAL OF BENCHMARKING IN PAKISTAN
 Local industry is not yet well developed and
is sprouting its wings.
 Cultural growth and professionalism is
inchoate.
 The leading enterprises are foreign based
whether pharmaceuticals, automobiles or
other FMCGs.
 These transnational companies have
nurtured a professional culture.

43. POTENTIAL OF BENCHMARKING IN
PAKISTAN
 The professional culture has paid TNCs
in Pakistan through huge revenues.
 MNCS have small market share volume
wise and high share price wise.
 National companies share is greater
volume wise and fewer revenues wise.

44. POTENTIAL OF BENCHMARKING IN
PAKISTAN
 A list of top ten pharmaceutical
companies in Pakistan is filled with the
MNCs
 Same situation exists in the beverages,
automobile, electronics and FMCGs.

45. POTENTIAL OF BENCHMARKING IN
PAKISTAN
 Since TNCs are leading in the
competition, they can be benchmarked
by the striving national companies.
 Every aspect of the business where
TNCs outperform their local
competitors can be benchmarked.

46. POTENTIAL OF BENCHMARKING IN
PAKISTAN
 These aspects include
Organizational culture
Marketing strategies
Operational activities
Financial aspects
Human resource
Or any other aspect