ece bm 29.8
TRANSCRIPT
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Dr.K.Baranidharan
Present by
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RECOGNITION/REWARD/ PERFORMANCE
APPRAISAL
Presented by
Dr.K.Baranidharan
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ECE
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BENCH MARKING
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The word benchmark is a reference ormeasurement standard used forcomparison. Benchmarking is the process of
determining who is very best, who setsthe standard, and what that standard is. Benchmarking is a systematic method by
which organisations can measurethemselves against the best industrypractices.
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Measuring an organisations performanceagainst that of best-in-class companies,determining how the best-in-class achievedthose performance level. It is a tools for continuous improvement. The process of identifying, understanding,and adapting outstanding practices andprocesses from organisations anywhere in the
world to an organisation to improve itsperformance.American Productivity andQuality Centre (APQC)
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Benchmarking is the search forindustry best practices that lead to
superior performance
by Robert Camp
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Benchmarking
Valuable TQM tool which accomplishes objectives of
customer satisfaction and continuous improvement.
Motivates an organization & fosters a new in-depth
understanding about the functioning of theorganization.
Reduces cycle time as small or big tasks get done
faster.
Constantly redefines standards which must be
achieved to remain competitive.
Increases productivity.
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OBJECTIVE
To determine what and whereimprovements are called for
To analyze how other organizationsachieve their high performance
levels, and
To use this information to improve
performance.
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Purpose of Benchmarking
Comparing an organizations performance
to the best organizations performance
Comparing an organizations business
process with similar process
Comparing product and services
Identify the best practices to implement Projecting trends
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The Evolution of Benchmarking
Evolved in the early 1950s, when W. EdwardDeming taught the Japanese the idea of
quality control.
Example
Toyota Motor Corporations following the
footsteps of Ford Motor Corporation with theadaptation of the Fords Just-in-case System
into Toyotas Just-in-Time System.
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Term Benchmarkingemerged in
1980s byROBERT CAMP, logisticsengineer who initiated Xeroxs
benchmarking program.
Use of benchmarking worldwide
continues to grow since Robert
Camp wrote the first book onbenchmarking in 1989.
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Benchmarking Process Model
Search
Observe
Analyze
Adapt Plan
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Steps in Bench Marking Process
1. Plan
Select the process
Form Team
Understand & document process
Establish performance measure
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2. Search
Listing Criteria for partner selection
Conduct general / secondary
research
Decide the level to Benchmark
Identify potential partners & contact
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3. Observe
Questionnaire sent to partner
Telephone contact
Direct observation / site visit
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4. Analyze
Sort information & data
Quality control information & data
Normalize data if necessary
Identify gaps in performance Level
Identify causes for gaps
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5. Adapt
Identify improvement
opportunities
Set target for improvement
Develop implementation plan,
monitor the progress
Write final report
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Customer service levels
Inventory management
Inventory control
Purchasing
Billing and collection
Purchasing practices
Quality process
Warehousing and distribution
Trans ortation
AREAS TO BENCHMARK
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Types Of Benchmarking
Internal
External
Performance or CompetitiveFunctional
Generic
StrategicProcess
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Internal Benchmarking
Comparison of similar functions in different
operating units within the organization
Example
Tata Steels Colliery divisions benchmarking
their maintenance practices with that of the
Maintenance division inside the Steel Worksat Jamshedpur.
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External Benchmarking
Comparison of organization
functions and key processes
against external good practice
organization.
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Performance or Competitive
Organizations using performance
measures to compare themselves against
similar organizations
Example
FMCGs comparing with each other for
Market share, Retention rates, profits,costs.
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Functional Benchmarking
Comparison of similar functions against
external best in any industry
Example
Hindustan Max GB Ltd , a
pharmaceutical company, benchmarkingtheir maintenance function with that of
Tata Steel.
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Generic Benchmarking
Comparison of functions which are genericin nature in any industry
Examples
Hospital in the U.S. routinely benchmark
their patient management against hotels
guest management.
Airlines benchmark their customers
service with 5 star hotels.
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Strategic Benchmarking
Used where organizations seek to
improve their overall performance by
focusing on specific strategies or
processes
Example
Benchmarking against organizationswhich have won awards or some other
distinctions
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Process Benchmarking
Focus on specific operations or processes
Examples In higher education - Enquiry
Management, Enrolment
In Logistics - Delivery, Safety.
In hotels - Housekeeping, Customer Care.
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Issues in Benchmarking
Finding suitable partners.
Difficulties in comparing data (50%
of organizations found this)Resource constraints (Time, Finance
and Expertise)Staff resistance.
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Benchmarking Tools
Matrix technology
Comparison tables
Graphs: Pie chart, Bar chart /Histogram
SWOT analysis Potential/resources-analysis
Price/performance ratio
Potential analysis
Life cycle analysis
market growth/market share portfolio
http://en.wikipedia.org/wiki/Histogramhttp://en.wikipedia.org/wiki/Histogramhttp://en.wikipedia.org/wiki/Pie_charthttp://en.wikipedia.org/wiki/Bar_charthttp://en.wikipedia.org/wiki/Histogramhttp://en.wikipedia.org/wiki/SWOT_analysishttp://en.wikipedia.org/wiki/Price/performance_ratiohttp://en.wikipedia.org/wiki/Potential_analysishttp://en.wikipedia.org/wiki/Life_cycle_assessmenthttp://en.wikipedia.org/wiki/Market_growthhttp://en.wikipedia.org/wiki/Market_sharehttp://en.wikipedia.org/wiki/Market_sharehttp://en.wikipedia.org/wiki/Market_growthhttp://en.wikipedia.org/wiki/Life_cycle_assessmenthttp://en.wikipedia.org/wiki/Life_cycle_assessmenthttp://en.wikipedia.org/wiki/Life_cycle_assessmenthttp://en.wikipedia.org/wiki/Potential_analysishttp://en.wikipedia.org/wiki/Potential_analysishttp://en.wikipedia.org/wiki/Price/performance_ratiohttp://en.wikipedia.org/wiki/SWOT_analysishttp://en.wikipedia.org/wiki/Histogramhttp://en.wikipedia.org/wiki/Bar_charthttp://en.wikipedia.org/wiki/Pie_chart -
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market attractiveness
Portfolio attractiveness customer
Technology/resource strength
Market position
Contribution margin
customer satisfaction portfolio
Revenue share
Spider web diagram
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Benefits of Benchmarking Improves organizational quality
Leads to lower cost Creates buy-in for change
Exposes employees to new ideas
Broadens organizations perspective
A catalyst for learning
Increase employee satisfaction
Test the internal operating target
Raise the level of potential performance
Sharing of best practices
Understanding world-class performance in-depth
Encourage and stimulate innovation
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Pitfalls and Criticisms ofBenchmarking The most persistent criticism of
benchmarking comes from the idea ofcopying others.
Benchmarking isnt very helpful if it isused for processes that dont offer much
opportunity for improvement.
Benchmarking is also not a substitute for
innovation
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Disadvantages of Benchmarking
Increase the diversity ofinformation so the potential for
information overload
May reduce managerial motivation
when comparing with a better
resourced rival Confidentiality of data may be a
risk
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EjemplosXerox, Hewlett Packard, Ford y General
Motors
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Dr.K.Baranidharan
THANK YOU