Benchmarking- An Effective Tool for Improvement

As we know each and every person have their own standards, sets of standards, rules, values and many more. But in corporate world, Benchmarking has a prime importance. This benchmarking is whole about the judgment. Corporate persons use this term to measure or to judge their performance, cost and productivity. In simple and practical way, parents always say that girls should be like “Jhansi Ki Rani". Similarly for corporate, there are many industries, companies who set themselves as a benchmark for another company. E.g. ISI mark for electric appliances. Management College should be AICTE approved. Thus we can say that ” Benchmarking is the tool for measuring cost, productivity, quality and also used for the comparison of performance among the peer group. It also provides the set of standards to other

INTRODUCTION:

As the proverb says that "BEHIND EVERY SUCESS, THERE IS SOMETHING ",  similarily benchmarking plays a vital role in the sucess of any organisation globally . Essence of the term benchmarking  is to deprive sucess. If the person have a target in his life, he himself get benchmarked. Benchmarking involves every department from the organisation . Now-a-days many companies using this concept for the progress of their company . This is a goal oriented technic and also a motivational tonic for the employes  working in the organisation . It is essential for one`s life . Benchmarking ensures the probability of success. Benchmarking is mainly used by service organisations, so as to increase customer satisfaction .

Meaning:
Benchmarking is talking about getting the best. This is the term or concept of motivation, increasing the performance of the employees’ .Mechanism behind the benchmarking is to identify quality improvements.

In general, the students set a benchmark, in terms of Role Model, percentiles, top ranked colleges etc. A student who is struggling for Engineering set IIT. College as there target. Thus we can say that for him IIT. is a benchmark. Similarly for Management student IIMs are the Benchmark, because IITs and IIMs produce a quality product with better results.

LITERATURE REVIEW :
The different reviews in chronological order are:

•    Roadmap to current benchmarking literatureº, Andrew E. Jackson, Robert R. Safford and William W. Swart, 1994, Journal of Management in Engineering, November/December, pp. 60-7.

•    A review of key publications on benchmarking: part Iº, Mohamed Zairi and Mohamed A. Youssef, 1995, Benchmarking for Quality Management and Technology, Vol. 2 No. 1, pp. 65-72. ªA review of key publications on benchmarking: part IIº, Mohamed Zairi and Mohamed A. Youssef, 1996, Benchmarking for Quality Management and Technology Vol. 3 No. 1, pp. 45-9.

•    Benchmarking: a select bibliographyº, S.N. Vig, 1995, Productivity, Vol. 36 No. 3, October/December.

•    A review of benchmarking literatureº, Czuchry, A.J., Yasin, M.M. and Darsch, J.J., 1995, International Journal of Product Technology, Vol. 10 No. 1/2, pp. 27-45.

•    A framework for benchmarking in the public sector literature review and directions for future researchº, Jeffrey J. Dorsch and Mahmoud M. Yasin, 1998, International Journal of Public Sector Management, Vol. 11 No. 2/3, pp. 91-115.

•    Theory and practice of benchmarking: then and nowº, Mahmoud M. Yasin, 2002, Benchmarking: An International Journal, Vol. 9 No. 3, pp. 217-43.

•    In 2008 , a comprehensive survey on benchmarking was commissioned by the GLOBAL BENCHMARKING NETWORK (a network of benchmarking centers representating 22 countries - and for which the founder of benchmarking , Dr. Robert Camp , is the honorary president ).Over 450 organisations from 40 countries. The result showed that :-

•    Mission and Vision Statement and Customer (Client) Surveys are the most used (by 77% of organisations ) of 20  improvement tools , followed by Strengths , Weakness , Opportunities and Threats SWOT (72%) , and Informal Benchmarkig was used by (49%)  and Best Practise Benchmarking by (39%) .

•    The tools that are likely to increase in popularity the most over the next three years are Performance Benchmarking , Informal Benchmarking ,SWOT and Best Practise Benchmarking. Over 60% of organisation that are not currently using these tools indicated are likely to use  them in the next  three years .






Steps/Process of Benchmarking:
There is no any single process of benchmarking which is universally adopted. Different organisation have different methods to benchmark their Quality, Cost, Productivity and many more. If we take a view on past methods followed by industrialists or by organisations are the most prominent twelve step methodology by "Robert Clamp" who wrote the first book on Benchmarking in 1989. Sir Robert divided steps in five phases and twelve steps. These steps are as follows:

Phases                                          Steps

Planning                                      -Enmark what is to be benchmarked?
                                                      -Identify the best competitor.

 Data                                            -Determine the data collection method and start collecting
Analysis                                      - Determine the current performance'GAP'.
                                                      - Project future performance levels.
                                                    
Integration                                  - Communicate benchmark findings and gain acceptance.
                                                      -Estabilish functional goals.
                                                      - Comunicate data for analysis.
                                                      - Give acceptance for analysis.
                                                                                                                       
Action                                          -Develop the action plans.
                                                      -Implement specific actions.
                                                      -Recalibrate benchmarks.

Maturity                                     -Attain a leadership position.
                                                     -Integrate practices into the process.

(Source:Adapted from Robert Clamp,1989)

Important thing is that all process which is adopted by organisations always follow those twelve steps which is given by Robert Clamp in 1989, while preparing their own methodology. So there is an example of a shorter version of the methodology:

Identify the problem areas:
This is called as planing stage.
•    Decide what you want to benchmark?
•    Decide against whom you need to benchmark?
•    Identify outputs required.
•    Determine data collection methodologies





Identification/Collection  of data:
Collection of data depends on following factors i.e This will be driven by:
•    What output is required ?
•    Form of the information used.
•    What is the nature of the exercise (group versus one : one)
•    How much time organisation have ?
•    Apart from all these there are two types of data available i.e., Primary data and Secondary data.

Secondary Data:
Data which is already available is 'Secondary Research'.  It is important to learn as much as possible before making any direct contact and this can be accomplished using 'desk research including publications and websites etc. This enables to get a picture of the firm(s) that you might wish to benchmark and an understanding of what you can bring to them.

Primary Data:
This is collected from direct interaction with the people, by observing the conditions prevailed in the organisations (Problem which is to be benchmarked.) This is the exercise which involves whole staff of the organisation. This is done by questionnaire, survey, telephonic interview, from website etc.

Analysis:
It involves careful understanding of the relevant integrated data. We can say that this is a process of validation and verification of data. Verififcation ie
•    current process involved in it
•    parteners involved in benchmarking

It involves two more phases’ i.e.

a)  Analysis of the current performance gap.
b)  Analysis of the project future performance levels.

Action/ Implementation of process:
Organization should develop and communicate an action plan for the changes that it will need in order to make further improvements. It is the phase of converting benchmarking findings into appropriate actions by communicating it in the organization and gaining the acceptance of the partners and staff involved in this process. Following steps should be followed while implementing the action plans:-
•    Set goals
•    Modify process according to company’s culture and organizational structure.
•    Develop formal action plan.
•    Implement the action plan in dummy organization.



Monitoring:
This phase  ensures that the new processes work in a better way, which involves collecting data on the new process, evaluating progress and if necessary, iterating changes, monitoring and reporting improvement progress, identifying opportunities for future benchmarking and recalibrating the measure regularly. While carrying out the total activities, a mechanism or an organisation has to be built to review the performance of the improved process periodically to ensure that the benefits are retained i.e., the process has to be a continuous one and should never be neglected.

Need of Benchmarking:
There are following key reasons of benchmarking:-
•     To provides realistic and achievable target after defining customer requirements.
•     To involve new ideas and high commitment in the organization.
•     To prevent companies from declining phase.
•     To become competitive in the market.
•     To create an atmosphere of continuous improvement.
•    To increase dedication of employees towards organization and allow them to visualize    the improvement which can be a  strong motivator for change.
•     To identify weak areas
•     To show the importance of improvement in the organization.

CONCLUSION:
In short, benchmarking is required by every organization for their continuous improvement and motivation of employees. It enhances the work capacity of the employees which ensures definite growth of an organization. This is a very popular concept now a days used by the organizations.

BIBLIOGRAPHY/ WEBLIOGRAPHY:
•    Total Quality Management-'Principles, Practice, and Cases- D.D Sharma
•    www.BPIR.com
•    www.google.com