Benchmarking: a quest for continuous improvement

Abstract

Any continuous improvement effort requires some aspect dedicated to benchmarking. In the last several years benchmarking has emerged as an integral tool to achieve business objectives. From its beginnings at Xerox, to Ford’s utilization to design the Taurus, the importance of the technique has been recognized and the frequency and scope has increased. In this regard, the International Benchmarking Clearinghouse performed two studies, one in 1992 and the other in 1995. The results illustrate this change in scope and frequency in just the last few years. In 1992, 95% of those surveyed indicated benchmarking was a necessary tool for survival, but they admitted they did not know how to benchmark. By 1995, 60% said they had benchmarked with other organizations and 75% indicated an awareness of the concepts. In 1992, the majority of the firms classified themselves as novices, whereas in 1995 they reported an average of four studies within the previous year and furthermore they had received an average of six requests from other organizations to participate in benchmarking studies. A recent study also shows that an increasing number of quality managers have embraced benchmarking for quality improvement (Chen and Paetsch, 1995). This chapter starts with the background and various types of benchmarking. It progresses to provide the guidelines and process for implementation. Finally, issues in regard to ‘what to benchmark’, ‘with whom’, and ‘lessons learned’ are further elaborated.