Benchmarking: compare your business

2. 3 POINTS:
1. About benchmarking
2. Focus on benchmarking
3. A real case history
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3. 1. ABOUT BENCHMARKING
Definition
Benchmarking is the process of
comparing one's business
processes or activities to
selected best companies where
similar processes exist, and
compare the results with one's
own
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4. 1. ABOUT BENCHMARKING
Benchmarking
can be consider
one of the eight
Principles of
Quality
Mangement,
continual
improvement
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5. 1. ABOUT BENCHMARKING
The history
• Cobblers and Benchmarking
• Xerox case study
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6. 1. ABOUT BENCHMARKING
Advantages
Benchmarking helps companies to:
• meet the customers' requirements
• define and hone the company strategy
• prevent failure
• involve staff at all levels
• promote an effective method of problem-
solving 6
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7. 2. FOCUS ON BENCHMARKING
Activities generally addressed by benchmarking
are:
• Calculating the percentage cost impact of an
activity on total costs
• Assessing impact on quality, costs and time
• Identifying strategic processes or functions
• Identifying factors that distinguish the company
from competitors
• Analyzing activities that need improving
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8. 2. FOCUS ON BENCHMARKING
The process
• Plan
• Do
• Check
• Act
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9. 2. FOCUS ON BENCHMARKING
The process: Plan
• Identify what aspects to benchmark
• Organize a working group
• Train all the employees
• Visit the organizations
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10. 2. FOCUS ON BENCHMARKING
The process: Do
• The collection of data and information
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11. 2. FOCUS ON BENCHMARKING
The process: Check
• Assessing the strengths of competitors and
compare the performance
• Establishing goals
• Integrating the goals into the company's
formal planning processes and check their
effective improvement in quality
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12. 2. FOCUS ON BENCHMARKING
The process: Act
• Implement action plans established and
assess them periodically
• Determine whether the company has
attained a superior performance level
• Return to the planning stage
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13. 2. FOCUS ON BENCHMARKING
Types
• Strategic Benchmarking
• Competitive Benchmarking
• Process Benchmarking
• Functional Benchmarking
• Internal Benchmarking
• External Benchmarking
• International Benchmarking 13
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14. 3. A CASE HISTORY
Xerox
In 1982 David T. Kearns, the CEO of Xerox,
discovered that the average manufacturing
cost of copiers in Japanese companies was
40-50% of that of Xerox.
Leadership Through Quality Program 14
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15. 3. A CASE HISTORY
Benchmarking against Japanese competitors,
Xerox found out that it took:
• twice to bring a product to market
• five times the number of engineers
• four times the number of design changes
• three times the design cost
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16. 3. A CASE HISTORY
Xerox Benchmarking model
Planning Analysis Integration Action Maturity
COMPETITIVE BENCHMARKING 16
FUNCTIONAL BENCHMARKING
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17. 3. A CASE HISTORY
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18. 3. A CASE HISTORY
The analysis and the study of the collected data
led Xerox to improve its internal function:
• Supplier Management System
• Marketing Management
• Quality Policy
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19. 3. A CASE HISTORY
As far as the Supplier Management System,
Xerox:
• reduced the number of vendors from 5,000 to
just 400
• created a vendor certification
process
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20. 3. A CASE HISTORY
As regards Marketing Management, Xerox:
• introduced a Customer Satisfaction
Measurement System
• sent out over 55,000
questionnaires monthly
to its customers
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21. 3. A CASE HISTORY
As concerns Quality, Xerox:
• formed 24 senior managers to help them
make Total Quality Management (TQM) a
part of its organizational culture
• integrated benchmarking with the company's
overall strategies
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22. 3. A CASE HISTORY
Other benefits
- 27%
+ 18%
+ 40%
- 60%
+ 39%
+ 38%
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23. 3. A CASE HISTORY
During the 1990s, Xerox created
the International Benchmarking
Clearinghouse (IBC)
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24. SOME FINAL THOUGHTS
• Benchmarking = Industrial espionage?
• Main difficulty: to find information
• Benchmarking causes companies to critically
consider their process and strategies
• Positive stimulus in an ever changing socio-
economic and cultural environment
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25. 25
09/03/2013 Laura Cafaro, Eleonora Marinucci, Giulia Focchi

26. GLOSSARY
• Process: a series of actions that are done in order to achieve a particular result
• Compare to/with (v.): when you are stressing similarities between the items compared, the most common word is “to”: “She
compared his home-made wine to toxic waste.” If you are examining both similarities and differences, use “with”: “The teacher
compared Steve’s exam with Robert’s to see whether they had cheated.”
• Principles of Quality Management: a quality management principle is a comprehensive and fundamental rule / belief, for
leading and operating an organization, aimed at continually improving performance over the long term by focusing on customers
while addressing the needs of all other stake holders
• Improvement: the act of improving something or the state of being improved; i.e. improvement in/on/to: “There's been a big
improvement in the children's behaviour.” “an improvement on earlier models” “We need to carry out some improvements to the
system.”
• Technique: a special way of doing something
• Improve (v.): to make something better, or to become better
• With a view to growing evolution: [with a view to (doing) something]: used to state that an action is performed with the
intention of obtaining a particular result in the future: ex. I came to this university with a view to getting a medical degree
• Measure (v.): to judge the importance, value, or true nature of something
• Performance: how well or badly a person, company etc does a particular job or activity
• Bench: a long heavy table used for working on with tools or equipment
• Meet the customers' requirements: satisfy the customers’ expectations
• Procedure: a way of doing something, especially the correct or usual way
• Hone vs. refine (v.): to hone: to improve your skill at doing something, especially when you are already very good at it; to
refine: to improve a method, plan, system etc. by gradually making slight changes to it.
• To address: direct one’s attention to / deal with, eg.: addressed by benchmarking: subjected to benchmarking
• Ways of (doing something): method that you use to do something
• Benchmark (v.): to use a company's good performance as a standard by which to judge the performance of other companies of
the same type 26
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27. • Be in charge (of doing something) (v.): if someone or something is in your charge, you are responsible for looking
after them
• Data collection tools: a piece of equipment or a skill that collects information or facts
• Assess (v.): to make a judgment about a person or situation after thinking carefully about it
• Establish (v.): to start/set up a company, organization, system, etc that is intended to exist or continue for a long time
• Integrate (v.): if two or more things integrate, or if you integrate them, they combine or work together in a way that
makes something more effective
• Achieve (v.): to successfully complete something or get a good result, especially by working hard
• Examine (v.): to look at something carefully and thoroughly because you want to find out more about it
• Involve (v.): if an activity or situation involves something, that thing is part of it or a result of it.
• On account of (something): quite a formal expression meaning owing to, because of as in On account of the recent
rise in the price of oil food prices are bound to rise.
• CEO (BOBBBChief Executive Officer): the person with the most authority in a large company
• Develop (v.): to design or make a new idea, product, system etc over a period of time
• Best-in-class: the highest current performance level in an industry, used as a standard or benchmark to equaled or
exceeded. Also called best of breast
• Led: past tense and past participle of “lead”.
• Lead vs. Take (v.): to lead: to take someone somewhere by going in front of them while they follow, or by pulling
them gently; to take: to move or go with someone or something from one place to another.
• Increase (v.): if you increase something, or if it increases, it becomes bigger in amount, number, or degree
• Reduce (v.): make something smaller or less in size, amount, or price
• Effort: the physical or mental energy that is needed to do something. Particular situation: effort can also be used in the
sense of work that people do to achieve something in a particular situation and could be translated into Italian as
“iniziativa”, “impegno”, ecc.. according to the different contexts
• Deliver (v.): here used in the sense of giving results that are promised, expected, or desired. Generally in business
English it is used in the sense of taking goods, letters, packages etc to a particular place or person.
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28. • Payoff: an advantage or profit that you get as a result of doing something
• Increase (v.): if you increase something, or if it increases, it becomes bigger in amount, number, or degree
• Reduce (v.): make something smaller or less in size, amount, or price
• Effort: the physical or mental energy that is needed to do something. Particular situation: effort can also be used in the
sense of work that people do to achieve something in a particular situation and could be translated into Italian as
“iniziativa”, “impegno”, ecc.. according to the different contexts
• Deliver (v.): here used in the sense of giving results that are promised, expected, or desired. Generally in business
English it is used in the sense of taking goods, letters, packages etc to a particular place or person.
SOURCES:
• www.wikipedia.org
• www.qualitiamo.com
• www.qualityi.it
• www.icmrindia.org
• management.about.com
• www.businessdictionary.com
• www.ldoceonline.com
• tutor2u.net
• Dizionario Garzanti
• Business Environment – Michael Black
• Economia e Management delle imprese – Hoepli
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