C H A PT E R - 2

INTRODUCTION TO BENCHMARKING AND LITERATURE REVIEW

2.1.INTRODUCTION TO BENCHMARKING

Benchmarking is now regarded as a vital tool in the quality toolbox and the applications of

benchmarking continue to grow in number and diversity as reflected in the literature. The

last two decades have witnessed a surge in the quest for quality as the markets are shrinking

due to stiff competition. This sustained interest on using the technique o f benchmarking to

improve quality has resulted in a surfeit o f articles and books.

Decision-makers are constantly on the look out for new techniques, to enable quality

improvement. While benchmarking, as a technique for quality improvement is not new or

unknown, it has now found more subscribers, and occupies a prominent place in the action

agenda. Quite often, the benchmarking concept is understood to be an act o f imitating or

copying. But in reality this proves to be a concept that helps in innovation rather than

imitation, as stated by Thompson, et. al. (1997).

2.2. BENCHMARKING - CONCEPTS

2.2.1. A short history of benchmarking

Throughout history, people have developed methods and tools for setting,

maintaining and improving standards o f performance. One can trace the desire to improve

performance and the actual process o f improvement as far back as the early civilizations; the

ancient Greeks left us with exemplary works o f architecture, art and design. The Romans

who built upon the achievements o f both Egyptians and Greeks by developing the ability to

construct bridges and roads to standardised designs. In a real sense, benchmarking is a

natural evolution from principles o f Quality Measurement and TQM.

The early benchmarking phase began in the late 1950s. The Japanese visited many

thousands o f companies round the world, mainly in America and Western Europe,

specifically to absorb ideas that they could adopt and improve upon their manufacturing

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processes. The Japanese investigated Western products and processes to understand their

good and bad features, and build superior alternatives at lower cost.

According to Camp (1993), benchmarking originated in the late 1970s in America

when the Xerox Corporation adopted a similar vigorous approach in 1979. During this time,

the Xerox business plummeted due to competition from Japan. Then, Xerox felt they had no

choice. Their competitors were able to sell products more cheaply than Xerox could make

them. To understand why this was, the product features and performance capabilities o f

competitive machines were rigorously evaluated and Xerox was able to investigate the

practices o f Fuji Xerox in Japan. The improvement opportunities that were identified and put

into place resulted in a swift turn around for Xerox’s fortunes and led to Best Practice

Benchmarking becoming a central part o f X erox’s business strategy. In the year 1982, Xerox

benchmarked its logistics and distribution unit against retailer L.L.Bean to improve its

warehousing and material handling operations.

In 1985, Metro Toronto Reference library in Toronto, Canada conducted the first

known library benchmarking study o f its public service department. In the year 1991, the

term “benchmark” was added to the guidelines for the prestigious ‘Malcolm Balridge’ award

and benchmarking became a qualifying condition for companies aiming at this award.

Benchmarking as a research strategy emerged in the 1990s, in the business sector. The

American Productivity and Quality Center (APQC) opened its ‘International Benchmarking

Clearinghouse’ in the year 1992.

The history o f benchmarking as described by Watson (1993) has been categorised

under five generations o f benchmarking. The first generation was reverse engineering, which

was an engineering-based approach to product comparisons that included teardown and

analysis o f technical product characteristics. The second generation was competitive

benchmarking which Xerox refined starting in 1976. This type o f benchmarking went

beyond product-orientation comparisons to comparing processes with competitors. In the

1980s, the third generation o f benchmarking was process benchmarking, which included

searching for best practices across industry boundaries. The fourth generation benchmarking

was strategic benchmarking; where it was used to fundamentally change the business, not

just alter the processes. Lastly, the fifth generation was global benchmarking, where

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international trade, cultural and business process distinctions among companies are abridged

and their implications for business process improvement are understood.

Till date, benchmarking has naturally evolved as a technique encompassing concepts

o f competitor and market analysis, quality improvement programmes, performance

measurement and, perhaps most o f all, Japanese practices.

In summary, it can be said that the origins o f benchmarking, in one sense, be traced to

the early method o f examining products o f competitors to see how they are made and how

they could be made, whether the same or better.

2.2.2. Benchmarking - Meaning and definitions

Benchmarking as a Verb refers to a process o f comparing agencies’ operations and

performance against recognised standards and improving those operations to enhance the

effectiveness.

A benchmark as a Noun refers to the numerical target or reference point for taking

measures against.

This word has migrated into the business world, where it has come to mean: “A

benchmark is a measured best-in-class achievement recognised as the standard o f excellence

for that business process” .

According to W ebster’s dictionary (1990), the word benchmark has its origin from

geographic surveying, where it means “A marked point o f known or assumed elevation from

which other elevations may be established”.

The International Clearinghouse for Benchmarking (1992) defined benchmarking as the

“process o f continuously comparing and measuring an organisation with business leaders

anywhere in the world to gain information that will help the organisation take action to

improve its performance” .

As stated by Me Nair and Leibfried (1992), “To benchmark is to shrug o ff history and to

embrace the future.

Andersen (1994) states the generic definition, as “Benchmarking is the process o f

comparing something or someone with best practice” .

Best practices are collections o f activities within an organisation that are done very well and

ultimately, are recognised as such by others.

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According to the APQC (1997), benchmarking is “the process o f identifying,

understanding and adapting outstanding practices from other organisations to help an

organisation improve performance” .

The core o f the current benchmarking interpretation is;

■ M easurement o f own and the benchmarking partners’ performance level, both for comparison and for registering improvements. Comparison, o f performance levels, processes, practices etc.

■ Learning, from the benchmarking partners to introduce improvements in one’s own organisation.

■ Improvements as the ultimate objective o f any benchmarking study. Improvements encompass incremental change, major steps and innovations.

The concept o f benchmarking, like TQM, has the concept o f the internal business process

as one o f its central ingredients. The crucial internal processes o f the business need to be

identified, and measures and measurement points have to be established. Comparisons in

processes and process performance have to be made externally, as well as internally, and

process improvements need to be put in place.

In a nutshell, benchmarking is an advanced quality improvement methodology, which

may be integrated into a TQM system. It is the most important contribution by the Western

world to quality improvement methodology, since the foundations o f quality revolution were

laid by W alter A. Shewhart, Dr. Williams Edward Deming and Dr. Joseph Juran.

2.2.3. The need for External Comparisons

Today, competition is on the global level for many businesses and in many critical areas,

the only sensible goals are the ‘W orld’s best practice’. For many other companies,

competing in smaller arenas, the targets may mot always be as stringent, but the need for

realistic goal setting is just as important. Benchmarking is a method o f making sure that the

targets aimed for are relevant to market demands. The technique is equally applicable in

manufacturing and service organisations.

Making comparisons with competitors is not a new idea. Acquiring data about how

competitors are performing, what their product range comprises, what prices are they able to

command, and perhaps their operating methods, has always been part o f a businesses modus

operandi. Thus benchmarking is a highly - respected proactive management tool which is

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increasingly being used to identify and focus improvement activities with the goal o f

international competitiveness.

2.2.4. Benchmarking Barriers and Misconceptions

Gift, et.al. (1994) have reported a few reasons for not conducting benchmarking. The

barriers identified include:

• Lack o f action• Not involving the appropriate people (process owners)• Not understanding that learning can happen even without inventing it.• Lack o f understanding the internal processes• W eak leadership• Inability to see opportunity to improve• Organisation not promoting entrepreneurial behaviors, innovation or risk taking• Failure to see need for change

As benchmarking emerged, an organisation that conducted any type o f comparisons, such

as comparing data with national norms, competitive analysis, or unstructured discussions

with counterparts in other organisations, claimed it was benchmarking, as reported by

Keehley (1997). A quantitative comparison o f performance is only a small part of

benchmarking process. An organisation needs to define the true meaning, role, and use of

benchmarking in its own environment, including how it uses comparative data, as stated by

Gift (1996).

Common misconceptions for benchmarking can be commonly grouped under the

following:

• Benchmarking leads to rating and ranking o f performance• Participation in benchmarking is revealing trade secrets that would lead to compromising

competitive advantage.• Benchmarking leads to explicit cause-effect relationships with best practices.• Benchmarking is a panacea.• It is a one-time programme• It is a reactive tool• Benchmarking is just copying others.

In summary, benchmarking is not simply data comparison, a fad, a means for reducing

resources, a quick-fix program, or consolidation o f visits to different industrial

establishments. Benchmarking is a means o f doing business, a continuous and disciplined

management process with a structured methodology.

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2.3. BENCHMARKING MODELS

2.3.1. Requirements for a successful benchmarking Model

A benchmarking model should have logical flow o f ideas. The attributes o f the model

should be clear so that people can describe it to others and the listener can understand in

order to translate into action.

A benchmarking model should have the following requirements built in:

• A clear understanding o f benchmarking requirements• Identification o f benchmarking team• Use o f effective project planning tools and techniques• The model has to create a set o f expectations regarding the information; how it is to be

gathered, reported and used to review and adjust progress o f activity.• Identification and analysis o f gaps.• Feed back provision to take action and recycle.

2.3.2. A review of Benchmarking Models

Benchmarking is usually treated as a structured process. The structure is best provided by

the development o f a step-by-step model. The process models provide structure so that the

user can see the benchmarking route. They provide a common process in a language

understandable to all, by allowing a basic framework for successful planning and execution

o f a benchmarking exercise.

The literature has frequently cited benchmarking models. A few profound models have

been noted for review. It is also true that every organisation will approach the benchmarking

process from its own perspective and will need to customise the generic benchmarking model

accordingly. A few o f the models reviewed are:

• The Camp Model• M eta-model developed by International Benchmarking Clearinghouse• Baxter Benchmarking Model• Spendolini’s 5-stage Benchmarking Process• Watson Model• Leibfried and Me Nair Model• Benchmarking process Model• The APQC Model

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Each o f these models have exhibited benchmarking as a continuous process with

successive phases being critical to the successful execution o f the process. A B rief summary

o f these models is given in Table. 2.1.

Table - 2.1. Summary o f Benchmarking Models

NAM E OF THE MODEL STEPS/STAGES REMARKSa. Camp M odel (1989)- Also called the Xerox’s 10 step model

PlanningAnalysisIntegrationAction

Extremely detailed Leaves no flexibility in terms o f chosen procedure__________

b. Generic “M eta-M odel”- Depicted by Andersen (1994)- Developed byInternational Benchmarking Clearinghouse (IBC)_______

PlanCollectAnalyseAdapt/Improve

Information given in the model is extremely limited Can be structured to suit the needs o f the user

c. Baxter Benchmarking Model- Developed by Baxter Corporate Consulting- Portrayed by Lenz, S., et.al. ((1994)- 15 Steps model_________

Preparation Phase: 5 StepsAnalysis Phase:10 Steps

Model is based on the premise that the best ideas come from people who are closest to the process

d. Spendoloni’s Five - Stage Benchmarking Process- Model conceived by Spendoloni(1992)- 5 Stage Model

Determine what to benchmark Form abenchmarking team Identify benchmarking partnersCollect and analyse benchmarking information Take action

A Circular model Model portrays concept o f ‘Recycling’ to denote the concept o f continuous improvement

NAME OF THE MODEL STEPS/STAGES REMARKSIt contains fewer steps than the Camp-model Describes all steps in a complete benchmarking study

e. The W atson - Model- Developed by Watson (1992)- Six Steps Model

PlanSearchObserveAnalyseAdaptImprove

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Summary of Benchmarking Models jContd..]

f. The Leibfried and M cNair - Model- Model put-forth by M cNair and LeibFried (1992)

Identify core issues Internal baseline dataExternal DataCollectionAnalysisChange Implement

Based on a logical sequence to the learning process that is embedded in benchmarking It is more a system’s model with input / output criteria______

g. Benchm arking Process Model- Also called the “Benchmarking W heel”- A Circular modeldepicting 5 steps_________

PlanSearchObserveAnalyseAdapt

Similar to Spendoloni’s Five State benchmarking processSteps are similar to the W atson Model

h. The APOC Model- The Benchmarking M anagement Guide (1993) published by the American Productivity and Quality Center (APQC) proposed a four-phased benchmarking methodology as a generic approach to benchmarking.

PlanCollectAnalyseAdapt/Improve

This model is similar to the ‘meta- m odel’Follows the ‘plan-do-check-act’sequence

In summary, it can be said that models merely contributed structure and a common

language for a process. These models in the literature review showed benchmarking to be a

planned, formal, and structured process. Further, there should always be some flexibility

built into any process or model to accommodate situational variation.

2.4. TYPES OF BENCHMARKING

Literature does not suggest consensus on the types o f benchmarking. A number of

authors seem to capture different categories o f benchmarking. However, in general there are

four types o f benchmarking:

• Internal Benchmarking

Internal benchmarking means comparison o f internal operations between different divisions

or similar functions in different operating units within an organisation. Internal

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benchmarking compares similar internal functions within an organisation, and it often serves

as a pilot project for conducting external benchmarking.

• Competitive Benchmarking

Competitive benchmarking compares a work process with that o f the best competitor in the

same market. It reveals the performance measure levels to be surpassed. Competitive

benchmarking is basically benchmarking against external direct product competitors.

• Functional Benchmarking

Functional benchmarking compares a work function to that o f the functional leader in the

same industry or cross-industry. Functional benchmarking is done with functional

competitors or industry leader firms, even if the industries themselves are dissimilar.

• Generic Benchmarking

This focuses on the best work processes. Instead o f focusing on a company’s business

practices, similar procedures and functions are benchmarked.

Further, as reported by Zairi and Pervaiz (1999), one recent categorisation has been from

the European Commission initiative that proposes three levels in benchmarking:

• Company• Sectorial• Benchmarking o f framework conditions.

Table 2.2. shows the different categories o f benchmarking. It is clear that at the moment

several varieties o f benchmarking exist and there could be some overlapping also. However

it is pertinent here to look at the categories as suggested by different authors.

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In an interview to the journal ‘Management Review’ [Anonymous-l (1994)], Juran used an

interesting anecdote to describe functional benchmarking. Early in the century, some German

generals decided to follow an American circus to learn about deployment. In those days, the

circus performed under tents, moved from city to city in a short period o f time transporting all

kinds o f people, animals, and gear, and were very efficient at it. The military had the same

problem, moving large numbers o f horses, tents, ammunition, and food. The generals conducted

functional benchmarking with a circus, an operation not related to army.

2.5. BENCHMARKING - A LITERATURE REVIEW

Many authors have contributed to the literature on benchmarking resulting in more than 350

publications as o f June 2002. Considering the growth o f publications, some attempts have been

made in the past to review the literature. However, the present attempt as a part o f the research

work is different from the earlier reviews and more broad based in coverage. This review of

literature, covers the following objectives:

" Arranging the publications in an orderly manner to enable easy and quick search " Classification o f literature " Scrutiny o f outcome o f publications" Identifying gaps and providing hints for further research.

The review process first starts by providing a comparison among the earlier reviews on

benclimarking and highlights the outcome in each case. Next, a new methodology for classifying

the literature is suggested. The growth and categorisation o f publications are presented in a

graphical form for easy understanding.

2.5.1.Earlier Reviews o f Literature on Benchmarking

It was found out during the current research that at least six literature reviews have been

made in the past and all but one were studied by the authors. The different reviews in

chronological order are:

1) “Roadmap to Current Benchmarking Literature” ., Andrew E.Jackson Robert R. Safford

and W illiam W.Swart, 1994, Journal o f Management in Engineering., November /

December., pp: 60-67.

26

2)a. “A Review o f key publications on Benchmarking: Part I” ., M ohamed Zairi, and

M ohamed A.Youssef, 1995., Benchmarking for Quality Management and Technology,

V o l.2 ,N o .l,p p : 65-72.

b. “A Review o f key publications on Benchmarking: Part 11”., Mohamed Zairi, and

M ohamed A.Youssef, 1996, Benchmarking for Quality Management and Technology

Vol.3, N o .l, pp: 45-49.

3) “Benchmarking: A Select Bibliography” ., S.N.Vig, 1995, Productivity.Vol.36, No.3,

October-December.

4) “A review o f benchmarking literature”, Czuchry, A.J., Yasin, M.M., and Darsch, J.J.,

1995, International Journal o f Product Technology, V ol.10., N os.1/2, pp: 27-45.

5) “A framework for benchmarking in the public sector Literature review and directions for

future research”., Jeffrey J.Dorsch and Mahmoud M. Yasin, 1998, International Journal

o f Public Sector Management., V ol.l 1, No.2/3, pp: 91-115.

6) “Theory and practice o f benchmarking: then and now”., Mahmoud M. Yasin, 2002,

Benclimarking: An International Journal., Vol. 9, No.3., pp: 243.

Out o f the six publications cited here, the fourth one namely ‘A review o f benchmarking

literature’, by Czuchry, et.al. (1995) was not available to the authors at the time o f literature

survey and hence the authors could not use the valuable information o f this publication for a

comparative study.

Further, a comparison among the earlier attempts to review literature on benchmarking is made

using certain attributes. Outcome o f the different reviews are shown in Table - 2.3.

The attributes considered for comparisons are:

• Focus and Objectives: This refers to a brief coverage o f the publications in terms o f the content and the applicability.

• N um ber and Type o f Publications covered: The number o f publications listed and whether they are Text Books, Journal Papers, Conference Proceedings or Periodicals.

• Review methodology: It looks at the way in which the literature has been reviewed and classified.

27

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Apart from these distinguishing attributes, certain common parameters like, the Name o f

PubHcation, Author(s), Year o f publication. Journal o f publication are also used.

2.5.2, Preamble to Literature review

There is a proliferation o f literature on the topic o f benchmarking in the last 15 years,

as revealed in this literature review. Considering the gamut o f publications it can be said that

the benchmarking technique has seen a steady growth and appears to be heading towards

maturity level.

As a part o f the research it was decided to classify and analyze the literature in detail. The

course o f action included the following steps:

■ Updating the database to ensure that literature is as current as possible. The collection o f

literature has been reviewed till June 2002.

" For literature search, both hardcopy search in established libraries in India and electronic

search in World Wide Web were made. The well-known search engines available at

w w w .g o to .co m ,www.altavista.com and www.google.com were specifically used to

ferret the literature pertaining to benchmarking from a wide variety o f sources on the

internet. An honest attempt has been made to include as many publications as possible,

without claiming that the listing is complete or exhaustive in nature.

" Developing a classification scheme was the next step. First a bibliographical list o f all

publications was developed and a file was created in Excel spreadsheet.

" The review process in a different way and is illustrated in the subsequent sections.

2.5.3. M ethodology and Scheme of Review

The classification scheme proposed includes a simultaneous parallel categorization that

highlights the growth o f literature from time to time and also the coverage o f benchmarking

specific to different groups like;

1. Benchmarking: General aspects or Fundamentals

All publications under this category deal with very general and fundamental concepts of

benchmarking, essentially for first time readers. Fundamentals are usually covered to a large

extent particularly when the discipline is in the introduction and growth stage. This can be

32

confirmed by the number o f publications, which appeared in the early time period o f the time

scale considered.

2. Benchmarking - Specific Applications and Case Studies

People are more interested to know about applications and success stories. Therefore this

should be a useful group. Under this categorisation, all literature dealing with applications

specific to manufacturing and non-manufacturing sectors are shown.

3. Benclimarking - Innovations / Extensions / New Approaches

When the technique reaches a saturation stage in terms o f its popularity, novel approaches

and innovations start appearing in the literature. This category is considered to recognise and

appreciate the novel approaches or paradigm shifts in benchmarking techniques or its

applications.

4. Benchmarking - Applicable to education sector

This categoiy is specially included here for the benefit o f academicians and also forms a

major aspect o f the present research.

It is understandable that a very strict demarcation in the categorisation is not possible

since there may be certain overlaps in the publications analysed.

A Pareto diagram o f the number o f publications in different categories is given in Figure -

2 . 1.

120<0c 100_ora 80

n 60 --3Q. 40 --5? 20

0 -

I Percent■ Cumilative Percent

Categ Categ Categ Category-1 ory-2 ory-3 ory-4

Publication Categories

Legend:Category-1 Benchmarking: General/Fundamentals/Models Category-2 -> Benchmarking: Specific Applications / Case Studies Category-3 -> Benchmarking - innovations and Extensions / New Approaches Category-4 -> Benchmarking - EducationFigure - 2.1. A Pareto diagram of the number o f publications in different categories

33

All the publications in the categories described earlier have further been coded based on the

chronological appearance o f the article, for the convenience o f the readers. The first code in

the form a number from 1 to 4, refers to the categories 1 to 4 illustrated above. Coding has

been done from 1980 onwards, since the concept o f benchmarking emerged during the

1980s. Also, the time interval for the first category is taken as 10 years.

This is adopted, since the number o f publications during the first ten years are not many.

Publications after 1990 have been categorised on a time interval o f two years. Thus, the time

periods are represented as “a” (ten years: January, 1980 - December, 1989), “b” to ‘h” (two

years each; January, 1990 to January, 2002). This time based coding is displayed in Table -

2.4.

Table - 2.4. The coding pattern for classification based on time of publication

TIME FRAME

January January January January January January January January1980 1990 1992 1994 1996 1998 2000 2002

. - - - - - - Onwards

Dec. Dec. Dec. Dec. Dec. Dec. Dec.1989 1991 1993 1995 1997 1999 2001

Category CO DEa b c d e f g h

1 1 - a 1 - b 1 - c 1 -d 1 - e 1 - f 1 -g 1 - h2 2 - a 2 - b 2 - c 2 - d 2 - e 2 - f 2 - g 2 - h3 3 - a 3 - b 3 - c 3 - d 3 - e 3 - f 3 - g 3 - h4 4 - a 4 - b 4 - c 4 - d 4 - e 4 - f 4 - g 4 - h

As an example, the article, ‘Measuring the Unmeasurable’ by Brisley (1983) is coded under

1- a. This means the publication was made during January 1980-December 1989 and it deals

with Category - 1, namely “Fundamentals o f Benchmarking”. Similarly, a publication coded

under 4 - c means the publication came out during January 1992-December 1993 and is

related to Category - 4, “Benchmarking Education Sector” .

Similarly, all the publications, based on this coding pattern, are identified in Table - 2.5, by

their serial number as given in the bibliographical list.

34

Table -2 .5 . Categorisation of all publications

Category -1 Benchmarking: General/Fundamentals/ModelsCODE ORDER IN THE BIBLIOGRAPHICAL INDEX

1 - a Brisley (1983), Camp (1989a, b, c, d, e) Fuld (1989), Furey (1987), Guilmetle and Carlene (1984), Johne and Snelson (1988), Pryor (1989), Tucker et al. (1987)

1 - b Benson (1991), Biesada (1991), Bowers (1991), Camp (1990), Davis (1990), Dickey (1991), Faidley and M usser (1991), Geber (1990), Linsenmeyer (1991), Martin (1991), Maturi (1990), Meyer (1991), Tyndall (1990), W alleck et al. (1991), W elleck et al. { \9 9 \) , Whiting (1991)

1-c Altany (1992), Atherton (1993), Biesada (1992), Bogan and English (1993), Bookhart (1992), Brown (1992), Bruder (1992), Camp (1992, 1993), Chappie (1992), Chung (1993a, b). Dale (1992), Day (1992), Enslow (1992), Ettorre (1993), Fink (1993), Fitz-Enz (1992a, b, 1993), Flower (1993), Forger (1992), Foster(1992), Gardner (1992), Hall (1992), Haserot (1993), Henricks (1993), Hequet(1993) Hiebler (1993), Hogg and Hogg (1993), HRFocus (1993), Hunter and Shearman (1992), Istvan (1992), Jennings and Westfall (1992), Julien (1993), Kharbanda (1993), Kimmerling (1993), King (1993), Kobe (1993), Lenckus (1993b), Main (1992), McGonagle and Fleming (1993), Micklewright (1993), Miller (1992b), Mittelstaedt (1992), M onczka and Morgan (1993), Nandi (1993), Newman(1992), Ogilvie (1993), Overman (1993), Pansley (1993), Payne and Blackboum(1993), Port and Smith (1992), Prestly (1993), Pryor and Katz (1993), Ransley (1993), Richardson (1992), Ryan (1993), Sasenick (1993), Sharman (1992a), Sheridan (1993a, b), Shetty (1993), Sillyman (1992), Singleton-Green (1992a, b), Soderberg and O ’Halloran (1992), Spendolini (1992), Sprow (1993), St Clair (1993), Stratton (1993), Tuttle (1993), Vaziri (1992, 1993), Venetucci (1992), Weatherly (1992), Weimer (1992), Weisendanger (1992, 1993)

]-d Anderson (1994a), Anderson and Pettersen (1994), Anderson and Camp (1995), Burgess (1995), Carris and Bartlett (1994), Czuchry et al. (1995), Fleisher and Burton (1995), Goldwasser (1995), Grayson (1994), Hollstein (1995), Jackson et al. (1994), Kinni (1994a, b), Lema and Price (1995), Longowitz and Rao (1995), Malec (1994), M oad (1994), Ottenliouse (1994), Pulat (1994a, b). Purchasing (1994), Rigby (1995), Tutcher (1994), Vig (1995), Zairi and Youssef (1995 a, c)

] -e Balm (1996), Bassi and Cheney (1997), Colding (1997), Dhawan (1996), Elmuti et al. (1997), Elmuti (1998), Fowler (1997), Harrington (1997), Lincoln and Price (1996), Malcolm (1997), Morgan (1996), Powers (1996/1997), Rogers (1997), Schumann (1996), Shen-Then (1996), Simmons (1996), Singh (1997), Smith (1997), Thompson and Cox (1997), Zairi and Ahmed (1996)

1-f Ammons (1999), Bhutta Khurrum and Huq (1999), Dorsch and Yasin (1998), Fetter (1998), Hillier et al. (1998), Holloway et al. 09 9 8 ), McGonagle and Fleming (1998), W ah-Fond et al. (1998), Zoins (1998)

1-g Battaglia and Musar (2000), Dervitsiotis (2000), Longbottom (2000), Per and Hollensen (2001), Prado and Prado (2001)

1-h Carpinetti and De Melo (2002), Strategic Direction (2002), Yasin (2002)

35

Categorisation o f ail publications [Contd.

Category 2 Benchmarking: Specific applications/case studies2-a Cavento (1988), Drozdowski (1983), Fifer (1989), Lowis and Albert (1985),

Subramanian (1984)2-b Bemowski (1991), Eccles (1991), Press (1991), Quality and Productivity

Management A ssociation (1991)2-c Allan (1993), Azzolini and Shillaber (1993), Bean and Gros (1992), Bracken

(1992), Bredin (1993), Brown (1992), Cecil and Ferraro (1992), Crow and Van Epps (1992), Chung (1993c), Crespy et al. (1993), Davis and Patrick (1993), Ford (1993), Gable et al. (1993), Gamble (1993), G off (1993), Harari (1993), Inger (1993), Johnson (1992), Karch (1992), Krause and Liu (1993), Lenckus (1993a), Markin (1992), McGaughey (1993), M iller (1992b), Owen (1992), Prairie (1993), Richman and Koontz (1993), Roth (1992), Schefczyk (1993), Schmidt (1992), Sharman (1992b), Shaughnessy (1993), Spitzer (1993), Verschoor (1993), Walsh (1992), W atson (1993), Wendel (1993), Zairi (1992)

2-d Adam and Vandewater (1995), Anderson (1994b), Baker (1994), Bell and Morey (1994), Bhat (1995), Bowman and Faulkner (1994), Bruder and Gray (1994), Chao(1994), Chen (1994), Clayton and Luchs (1994), Cooper and Kleinschmidt (1995), Delbridge et al. (1995), Holt (1994), Lee and Howard (1994), Lorence (1994), Maheshwari and Zhao (1994), Matzko and Wingfield (1995), Morey and Dittman(1995), Obinata (1994), Oliver and McDonald (1995), Petrick et al. (1994), Poirier (1994), Sinclair and Zairi (1995), Sohal and Lu (1995), Sweeney (1994), Voss et al. (1994), Wallace (1995), Zairi and Y oussef (1995 b), Zhao et al. (1995)

2-e Bergstrom (1996), Buscaglia (1997), Chapman and Hyland (1997), Clarke and Manton (1997), Edgett and Snow (1996), Epperheimer (1997), Evans and Dale (1997), Floch et al. (1997), Frederickson (1996), Fuller (1997), Goodman et al. (1996), Hamilton and Gibson (1996), Hiltrop and Despris (1997), Johnston and Kirch (1996), Keehley and Mac-Bride (1997), Lagoe and Aspling (1997), Le Sueur and Dale (1997), Millen et al. (1997), Min and Min (1996), M in and M in (1997), Nacker (1997), Ogava and Ketner (1997), Prior-Smith and Perrin (1996), Ramabadron et al. (1997), Relihan (1997), Roche (1997), Schioeder (1996), Voss and Blackmon (1997), Yasin and Zimmer (1996)

2-f Ahmed and Rafiq (1998), Ahmed and Zairi (1999), Badrinath et al. (1998), Beaumont and Sohal (1999), Beretta and Dossi (1998), Blinn (1998), Burgess(1998), Buyukozkan and Marie (1998), Coe (1999), Colding (1998), Corbett (1998), Davis (1998), Elmuti and Kathawala (1997), Gilmour (1999), Glass (1998), Hsien- Chen (1998), Jane-Davies and Kumar-Kochhar (1999), Jones (1999), Lagoe et al.(1999), Mann et al. (1998), Mann (1998), Mentzer et al. (1999), Parker (1998), Pfohl and Ester (1999), Simpson et al. (1999), Sohal et al. (1999), Tang and Zairi (1998a, b, c), Treadwell (1998), Whymark (1998), Zairi (1998a, b), Zairi and Ahmed (1999)

36

Categorisation o f all publications [Contd..]

Category 2 Benchmarking: Specific applications/case studies [Contd.. ]2-g Brah et al. (2000), Chung-W oon (2000), Chung-W oon (2001), Darmont and

Schmeider (2000), Handerson and Evans (2000), Johnson and Chambers (2000a, b), Kumar and Chandra (2001), Lagoe et al. (2000), Morling and Tanner (2000), Muthu et al. (2000), Nath and Mrinalini (2000), Robson and Prabhu (2001), Rodwell et al. (2000), Sarkis (2001), Shen et al. (2000), Simpson and Kondouli (2000), Ulusoy and Ikiz (2001), Zairi and Whymark (2000a, b)_______________________________________

2-h Davis and Kochhar (2002), Hyland and Beckett (2002), McAdam and Kelly (2002), Mukherhee et al. (2002), Underdown and Talluri (2002)

Category 3 -^Benchmarking: innovations and extensions/new approaches3-a Lewis et al. (1985)3-b3-c Crespy and Becker (1993), Harkleroad (1992), McGonagle (1992)3-d Elnathan and Kim (1995), Guimaraes and Langley (1994), Hutton and Zairi (1994),

Lu et al. (1994), Lucertini et al. (1995), Monkhouse (1995), Partovi (1994), Webster and Lu(1995)_________________________________________________________________

3-e Behra and Lemmink Jos (1997), Hiebeler (1997), Yun (1997)3-f Anderson and Moen (1999), Bhattacharjee (1999), Kumar et al. (1999), Madu and

Hua (1998), McNamee and Greenan (1999), O ’Dell et al. (1999)___________________3-g Featherman (2000), Fuller (2000), Razmi et al. (2000), Talluri and Sarkis (2001)

Jeffcoate et al. (2002), Sharif (2002)_________________________________________3-h

Category 4 -> Benchmarking: Education4-a -

4-b -

4-c Shafer and Coate (1992)4-d Brennan (1995), Houshmand et al. (1995), Williams (1995)4-e Dittenhofer et al. (1996), Fredenberger et al. (1996), King (1996), Parisean (1997),

W eeler(1996)4-f D ’Mello (1999), Epper (1999), Godfrey and Godfrey (1999), Howe and Martin

(1998), Lomas (1999), Payne and Whitfield (1999), Raghunath (1998),4-g Fiekers et al. (2000), Jackson (2001), Wan Endut et al. (2000)4-h Laughame (2002), Shaw and Green (2002)

2.5.4. Observations and Comments

In this review, 384 publications in total are analysed for the purpose o f providing

insights to the growth and development o f benchmarking concept. These publications

include specific papers in national/international journals, and conferences. Other articles

such as exclusive reports in newsmagazines, newsletters, special columns and editorials are

left out as the authors feel that they deal with general information in a limited mamier.

37

Similarly books written on benchmarking are also omitted from the review. Further, 170

publications belong to general aspects or fundamentals o f benchmarking, 166 papers pertain

to specific applications/case studies in benchmarking, 27 publications come under

innovations/extensions/new approaches in benchmarking and finally, 21 publications fall

under the category o f benchmarking applicable to education sector.

As seen in Figure-2.1., almost half o f the publications speak about the general aspects o f

benclimarking. Often it is mentioned in literature that the benchmarking concepts were

initiated during 1989, after Xerox publicized it. At this point, it is worthwhile to note that

attempts to use this concept were made first, in the year 1983-1984 as indicated by Brisley,

(1983). In terms o f its application in the industry, Guilmetle and Carlene (1984), explore the

utility o f benchmarking in employee training whereas Lowis, et. Al. (1985), illustrate this

concept as a viable tool for computer performance evaluation during the year 1985. It is also

interesting to note that, as publicized by Subramanian (1984) certain interfirm comparisons

were made in the Asian region as early as in the year 1984.

Regarding the application o f benchmarking concepts to industry and service sectors,

published literature started appearing in a noticeable way only after the 1980’s.

The contributions in the form o f technical papers on general aspects o f benchmarking are

maximum in number during the period 1992 - 95. This is probably due to the initial

curiosity and interest generated on the topic. Thereafter there has been a decline, as seen in

the chronological listing o f publications number-wise in the line graph in Figure - 2.2.

In the sample o f literature collected it is seen that there are 166 papers, specific to the

category “Benchmarking - Specific application / Case studies” . Regarding Case Studies

group, it is observed that one o f the first applications, namely benchmarking o f purchasing

activities was done in the year 1983 as reported by Drozdowski, (1983). Subsequently many

case studies have been conducted in the manufacturing sector and also in the service sector.

Even here, the number o f publications during 1993 -9 9 are maximum and there after there is

a decline.

38

Figure. 2.2. Graph Showing Chronological Appearance o f all publications

This suggests that the concept has been applied successfully to almost all functional areas.

Table - 2.6, shows the application o f benchmarking to different functional areas.

Table - 2.6. Different functional areas covered by various authors

Specific Areas o f Application of Benchmarking

Order in the Bibliographical Index

Accounting Processes Beretta and Dossi (1998), Sharnian (1992b), Verschoor (1993)

Banks Mukherjee et al. (2002), Wendel (1993)Benchmarking Operations Bredin (1993), Cecil and Ferraro (1992)Business re-engineering Adam and Vandewater (1995), Rishman and

Koontz (1993), Simpson et al. (1999)Career M anagement Epperheimer (1997)Change Management Clarke and Manton (1997)

39

Specific Areas o f Application of Benchmarking

Order in the Bibliographical Index

Core Competencies Per and Hollensen (2001)Credit Function Chung (1993c), Gamble (1993)Education Dittenhofer et al. (1996), D ’Mello (1999),

Epper (1999), Godfrey and Godfrey (1999), Howe and Martin (1998), Lomas (1999), Laughame (2002), Payne and Whitfield (1999), Raghunath (1998)

Employee Attitudes Bracken (1992)Environment Bhat(1995), K arch(l992)Facility M anagement Johnson (1992)Finance Schmidt (1992), Spitzer (1993), Whymark

(1998)Food and Drinks Industry Mann (1998)Health and Safety Management Fuller (1997), Inger (1993), Lorence (1994)Hotel Services Min and Min (1996, 1997), Morey and

Dittman (1995)Human Resources Ford (1993), Hiltrop and Despris (1997), Holt

(1994), Parker (1998), Prior-Smith and Perrin (1996), Rodwell et al. (2000)

Information Technology Allan (1993), G off (1993), Lowis and Albert (1985), Quality and Productivity Management Association (1991)

Law Courts Buscaglia (1997)Library Shaughnessy (1993)Logistics Cavento (1988)Manufacturing Sarkis (2001), Sweeney (1994), Voss et al.

(1994)Marketing Gable et al. (1993)Operational Performance Voss and Blackmon (1997)Performance M easurement Eccles(1991), M iller (1992b)Physician Workforce Floch et al. (1997), Goodman et al. (1996),

Schroeder(1996)Pre-project Planning Hamilton and Gibson (1996)Preventive Maintenance Practices Chen (1994), Muthu et al. (2000)Product Development Ogava and Ketner (1997)Public Sector Bruder and Gray (1994), Coe (1999), Davis

(1998), Frederickson (1996)Purchasing Drozdowski (1983)Research and Development Bean and Gros (1992), K iause and Liu (1993),

Nath and Mrinalini (2000), Press (1991)Retail Distribution Strategy Matzko and Wingfield (1995)

40

Different functional areas covered by various authors (C ontd ..]:Specific Areas o f Application of

BenchmarkingOrder in the Bibliographical Index

Risk Management Blinn (1998), Lenckus (1993b)Sales Performance Mann et al. (1998)Safety M anagement Relihan(1997)Sales Forecasting M entzer et al. (1999)Small and M edium Industries Badrinath et al. (1998), McAdam and Kelly

(2002)Spare Parts Logistics Le Sueur and Dale (1997), Pfohl and Ester

(1999)Supply Chain Operations Ahmed and Zairi (1999), Gilmour (1999)T elecommunications N acker(1997)Travel Management Bell and Morey (1994)Treasury Treadwell (1998), Wallace (1995)World Class Manufacturing Owen (1992)

It can be seen in Figure - 2.2 that under the category o f “Benchmarking Innovations and

New Approaches” , the number o f publications increased from 4 in 1990-91 to 38 in 1992-93.

However, 1999 onwards there appears to be a drop in the number o f publications.

Here, the paper by O ’Dell, et.al. (1999) is worth mentioning since the paper details

the applicability o f benchmarking in analysing how organisations seek to incorporate various

knowledge management approaches into their business. Also, the paper by Guimaraes, et. al.

(1994) speaks about the relationship between overall company innovativeness and company

performance. They also point out that benclimarking innovation involves developing a plan,

which include dimensions o f innovation success: seeking, evaluating, using and fostering

innovation.

Another new approach to benchmarking has been highlighted by Fuller, (2000), where the

use o f benefit curves for benchmarking processes has been extensively discussed. Similarly,

the paper by Featherman, (2000) uses uncertainty modeling as a component o f

benclimarking, which is a new approach towards benchmarking.

Among the 8 papers reviewed under the "Benchmarking-New Approaches" category, it is

worthwhile to mention the coverage o f two papers. First one by McNamee, et.al.{\999)

reports about the Competitive Analysis Model, a new approach to strategic benchmarking o f

small firms. The second one by Talluri, et.al., (2001) describes some geometrical equations

that will help analyse benchmarking data.

41

Finally, in the category dealing with “Benchmarking in Education”, 21 papers have been

reviewed. These papers deal with benchmarking o f management education, engineering

education, schools and student relations.

2.5.5. Critical View on Review o f Literature

A scrutiny o f the publications show that several aspects o f benchmarking along with

many interesting and diversified applications, have been covered in sufficient detail. These

publications can serve a great deal towards quality improvement. Thus academicians,

practitioners and researchers have a good number o f sources in the form o f more than 300

articles to study, discuss and debate over many aspects o f benchmarking.

The present review o f literature on benchmarking, carried out as a part o f on-going research,

has identified certain issues which have not been satisfactorily addressed or not been

addressed at all. These issues can be regarded as inadequacies and they offer scope for

further research and exploration. The issues identified are as follows:

a. Cost aspects o f benclimarking

The overall cost incurred in carrying out a benchmarking exercise needs to be established,

say in temis o f cost models or cost equations. This would enable the decision-makers to

decide upon financial commitment before embarking on the benclimarking exercise.

Further it would allow to estimate the return on investment, and to convince the top

management. While a precise model is difficult, because o f variability o f factors involved,

an approximate method would be quite useful.

b. Duration o f benchmarking exercise

Guidelines regarding setting up o f a timeframe for conducting benchmarking are not

available. If a method can be described to decide upon the total time involved in

benclmiarking exercise, it would prove very helpful in setting targets and deadlines.

42

c. Human Resources in benchmarking activities

Rationale behind formation o f cross-functional benchmarking teams, identification o f tasks

o f benchmarking teams, and responsibility sharing among benchmarking teams, have not

been discussed in sufficient detail. The human role in benchmarking activities needs to be

clarified in complete depth to ensure better teamwork in a benchmarking project.

d. Selecting benchmarking partner

Selection o f partner or superior performer, their duties and responsibilities, legal and business

aspects are to be further elaborated.

Sometimes, the superior performer as recognised in terms o f market leadership or

achievements/success rate, may not be willing to disclose the business practices. This could

be a major deterrent in the benchmarking process. Further best practices followed in a

certain successful organisation may not necessarily be the best when adopted by other

organisations. Eventually, success rate may also significantly differ across organisations.

43

References - Exclusive to literature survey(Not a part o f main references which appear at the end)

1. Adam. P., and Vandewater., (1995), “Benchmarking and the bottomline: translating business re engineering into bottomline results”, Industrial Engineering, Vol.27., No.2., pp. 24-6.

2. Ahmed, P.K., and Rafiq, M., (1998), “Integrated benchmarking: a holistic examination o f select techniques for benchmarking analysis”. Benchmarking fo r Quality Management and Technology, V ol.5 .,N o ,3 ., pp. 225-242.

3. Ahmed, P.K., and Zairi, M., (1999), “Supply chain partnerships - Theory and example o f best practice”, Benchmarking: an International Journal, Vol.6., No. 1., pp. 78-95.

4. Allan, F.C., (1993), “Benchmarking: practical aspects for information professionals”. Special Libraries, V ol.84., No.3., pp. 123-30.

5. Altany, D., (1992), “Benchmarkers Unite”, Industiy week, February, 3, pp. 25.6. Ammons, D., (1999), “A proper mentality for benchmarking”. Public Administration Review, Vol.59,

No.2, pp. 105(1).7. Anderson, B., (1994), “A benchmarking process model - The benchmarking wheel”. Proceedings from

the 10th International conference o f the Israel society fo r quality Jerusalem, Israel.8. Anderson, B., (1994), “Benchmarking in Norweigian industry and nationship benchmarking”,

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