What is Benchmarking?Benchmarking is a tool to help you improve your business processes. Any business process can be benchmarked. One of the biggest mistakes people make when beginning their benchmarking endeavor is that they only look to benchmark someone within their own industry. Although this doesn't hurt, you probably already know enough about your industry to know what works and what doesn't. Worse yet, some people think they must benchmark their competitor. What if the competition is worse than your company? Seems like a pretty good waste of time end energy. How about benchmarking a company that is well known for being a good model. Sometimes referred to as Best Practices, Exemplary Practices, Business Excellence. Bottom Line, who does the business process real well and has processes that are adaptable to your organization. Who is the most compatible for me to benchmark. Do I need to conduct a full on benchmark study or can I get 80-90% of what I need from just using the telephone, email, or an electronic survey. All these questions need to get addressed before you start ... Most business processes are common throughout industry. For example; NASA has the same fundamental Human Resources requirements for hiring and developing employees as does American Express. British Telecom has the same Customer Satisfaction Survey process as Brooklyn Union Gas. These processes, albeit from different industries, are all common and can be benchmarked very effectively. It's called "getting out of the box". Benchmarking - Each year, for the past nine years, The Benchmarking Exchange (TBE) reports on the most actively benchmarked business processes from the preceding year. The information is collected from thousands of TBE members and ranked by the most benchmarked process for the year. The purpose of the annual ranking is to show what business processes are being focused on the most and to provide a bit of insight as to what to expect in the coming year. The business processes shown are among hundreds of business processes and sub-processes tracked in TBE's Posting Board(sm) database.
Not surprisingly, Employee Development is in first place. Combining this with Employee Benefits (ranked #6), it's very clear that organizations continue to be heavily committed to and involved with their employee's interests. With unemployment at an all-time low and skill levels on the rise, holding on to your most valuable asset, the employee, has become more important than ever.Employee Development includes areas such as Training, Career Counseling and Assessments. With all the new technology available via the Internet, in addition to the traditional learning tools, e-Learning has recently become the new wave for efficient training.
Customer Satisfaction includes sub-processes such as Customer Service, Customer Focus and Help Desks. It would appear that in the past, organizations were so busy trying to manage their internal processes that the Customer was put aside. As you would expect, Customers began to revolt and exit. Once organizations were done putting out their internal fires (and if they were still around) they were able to better focus on Customer issues. With competition at an all-time high and the recent deregulation of several industries, the Customer process is sure to be in the top five for years to come. Expect to see this process gain even more momentum with the advent of new Customer service tools (product and service ordering, technical and sales material, etc.); available via the Internet.Human Resources continues to be among the top five processes benchmarked in 2000. It seems that with all of the mergers, downsizing, rightsizing, and upsizing activity in the mid-to-late 90's, that the need for better benefits packages, recruitment of new skilled employees and retaining existing skilled employees have created many challenges for Human Resources. Merger mania is still going strong, but has become more of an international effort rather than within the same country. This keeps employees in their jobs because of the difficulty in consolidating departments and/or functions when organizations reside in multiple countries. But you need to keep them happy! So, Human Resources is sure to be challenged with new technologies, employee needs and stakeholder interests for quite sometime.The Marketing process jumped from the shadows at 35th place in 1999 to hitting the top five as 4th place in 2000. This is the most dramatic process focus turnaround we've ever seen. Chances are, your organization spent some serious money in the past year on Internet Marketing. The incredibly high Return On Investment (ROI) of marketing on the Internet can't be ignored. You must, and you will, market your products and services on the Net. Even if your organization doesn't sell directly to the public, your website will be pointing potential Customers to a distributor's website. With just a couple of mouse clicks, a potential Customer can have a complete catalogue to peruse with up to the minute product selections, availability and prices. And, since the ROI is so good, sellers can offer substantial discounts for orders made over the web and still realize a high profit margin. Even if you don't have anything to sell (government agencies for example), you will have a website. Even the smallest company can look and feel like a giant at a fraction of the cost of other forms of marketing. Internet Search Engines such as Yahoo, Google, Lycos and hundreds more, steer potential, and more importantly, interested clients right to your door. Like catfish in a barrel.The Process Improvement/Management function itself is beginning to slip off the top five processes to benchmark. 1998/1999 saw a considerable amount of activity in benchmarking this process. It now appears organizations have their Process Improvement/Management infrastructure in place and are now well underway in setting out to assess themselves to see what other opportunities for improvement can be found.Benchmarking Do's and Don'ts Author: Amy Cannello, GM Service Parts
BENCHMARKING ETHICAL AND LEGAL GUIDELINES Benchmarking :
Successful benchmarking includes personal interaction, openness, sharing and the transfer of information. Trust between Benchmarking Parties is fundamental. To respect the rights and prerogatives of others and reflect legal considerations and limitations, the following guidelines are suggested for any benchmarking interaction. ETHICS:
LEGALITY:
PROPRIETARY INFORMATION: Any information (in tangible or intangible form):
INTELLECTUAL PROPERTY: Refers to the kind of property created from intellectual activities in the industrial, scientific, literary, or artistic fields. It includes business and technical information (e.g., scientific works, inventions, industrial designs, computer programs) and material that might lead to patents, copyrights, trademarks, service marks, and commercial names or designations.
CONCLUSION : Knowing the nature of the benchmarking topic, dealing ethically and legally, understanding information exchange latitudes, and following The Benchmarking Code of Conduct will contribute to a successful and mutually beneficial benchmarking interchange. THE BENCHMARKING CODE OF CONDUCT Benchmarking :
To contribute to efficient, effective and ethical benchmarking, individuals agree for themselves and their organization to abide by the following principles for benchmarking with other organizations:
REMEMBER: Keep It Legal Be Willing to Give what your Get Respect Confidentiality Keep Information Internal Use Benchmarking Contacts Don't Refer Without Permission Be Prepared at Initial Contact ETIQUETTE AND ETHICS In actions between benchmarking partners, the emphasis is on openness and trust. The following guidelines apply to both partners in a benchmarking encounter:
BENCHMARKING EXCHANGE PROTOCOL As the benchmarking process proceeds to the exchange of information, benchmarkers are expected to:
Follow these guidelines in face-to-face site visits:
This Code of Conduct was contributed to TBE (The Benchmarking Exchange) by Sam Bookhart of Bookhart & Associates. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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