Benchmarking

HR Articles - What is ?

Benchmarking (Comparing) is a selective method of finding out how and why some companies can perform tasks much better than other companies. There can be as much as a tenfold difference in the quality, speed and cost-performance of an average company versus a world-class company.

It involves the following seven steps-
1) Determine functions to benchmark.
2) Identify the key performance variables to measure.
3) Identify the best-in-class companies.
4) Measure performance of best-in-class companies
5) Measures the company's performance.
6) Specify programs and actions to close the gap
7) Implement and monitor results

A company can identify "best practices" companies by asking employees, customers, suppliers and distributors what they rate as doing the best. Major Consulting Firms can also be contacted for this purpose. To keep costs under control, a company should focus primarily on benchmarking those critical tasks that deeply affect customer satisfaction and Cost Management and where substantially better performance is known to exist.

Source: HR Concepts

Compiled and Edited by

Mr. S. Murugesan - Lecturer

Dr. P. N. Narayana Raja - Principal

Madurai Institute of Social Sciences

(Run by: DVR Foundation for HRD)

Madurai, Tamil Nadu, India