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Benchmarking - Coggle Diagram
Benchmarking
Benchmarking phase
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3. Researching and identifying best-in-class performance
It is often the most difficult phase. The critical steps are:
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1. Select and prioritize projects
- An organization must understand its critical success factors and business environment to identify key business processes and develop parameters defining what processes to benchmark.
- The criteria for selecting what to benchmark relate to the reasons for the existence of a process and its importance to the entity's mission, values and strategy. These reasons relate in large part to the satisfaction of end users or customer needs
4. Data analysis
- It involves Identifying performance gaps, understanding the reasons they exist, prioritizing the key activities that facilitate the behavioral and process changes needed to implement recommendations
- Sophisticated statistical analysis and other methods may be needed when the study requires many variables, testing of assumptions, or presentation of quantified results
5. Implementation
Leadership is most important in this phase. The team must be to justify its recommendations and manage the implementation of approved changes.
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Definition
Benchmarking is a method used by organizations to compare their performance with that of other entities know for their best practices.
By using reference points, such as metrics related to financial performance, customer satisfaction or operational efficiency, organizations can identify areas for improvement
Benchmarking enables the comparison of processes, operations or products. Examples:
- Days taken to close financial system and prepare the monthly financial reports
- Customer satisfaction percentages
- Defects per million products
- Dollar-sales per headcount
- Days from customer order to delivery
- Labor rates for comparable workers at a competitor's plant
- Bad debt write-offs
- Inventory spoilage
Important in performance improvement and quality management. It helps organization with productivity management and business process review.