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Resources - Benchmarking
Types of Benchmarking
A copier company has benchmarked against a camping goods store. An
ammunition supplier has benchmarked against a cosmetics company,
comparing shell casings and lipstick holders. An airline company looked at a
racing crew to see how to perform quick equipment maintenance and repairs.
Within the federal government, agencies have benchmarked their customer
service lines for promptness, accuracy, and courtesy against other federal
agencies as well as the private sector. The type of study undertaken is not as
important as recognizing that benchmarking, both inside and outside an
organization, can be enormously beneficial for different reasons and in different
ways. Due to the vast differences in resource investments and possible
outcomes associated with different types, management must make the decision
and identify which type the benchmarking team is to use.
No one type is the best way. One type might be more appropriate for an
organization than another depending on its environment, products, services,
resources, culture, and current stage of TQ implementation. There are four
primary types of benchmarking: internal, competitive, functional, and generic.
Internal benchmarking
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Benefits
Challenges
• fosters mediocrity
• limits options for growth
• low performance improvement
• can create atmosphere of competitiveness
• not much of a stretch
• internal bias
• may not yield best-in-class comparisons
Competitive benchmarking
Competitive benchmarking is a direct competitor-to-competitor comparison of a
product, service, process, or method. This form of benchmarking provides an
opportunity to know yourself and your competition better; combine forces
against another common competitor. An example of competitive benchmarking
within the Department of Defense, might include contrasting Army and Air Force
supply systems for Joint initiatives. Within the private sector, two or more
American car companies might benchmark for mutual benefit against common
international competitor; or, rival chemical companies benchmark for
environmental compliance.
Benefits
Challenges
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• threatening
• limited by trade secrets
• may provide misleading information
• may not get best-in-class comparisons
• competitors could capitalize on your weaknesses
Functional benchmarking
Functional benchmarking is a comparison to similar or identical practices (e.g.,
the picking process for assembling customer orders, maintaining inventory
controls of spare computer parts, logistics to move operational forces, etc.)
within the same or similar functions outside the immediate industry. Functional
benchmarking might identify practices that are superior in your functional areas
in whatever industry they may exist. Functional benchmarking would be
accomplished at the federal level by comparing the IRS collections process
against those of American Express. Comparing copper mining techniques to
coal mining techniques is an example in the private sector.
Benefits
Challenges
Generic benchmarking
Benefits
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• innovative
• high potential for discovery
• examines multiple industries
• can compare to world
Challenges
• difficult concept
• can be difficult to identify best-in- class
• takes a long time to plan
• known world-class companies are inundated with requests
• quantum changes can bring high risk, escalate fear
• class organizations in your process
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Copyright ©2000-2019 Geigle Safety Group, Inc. All rights reserved. Federal copyright
prohibits unauthorized reproduction by any means without permission. Disclaimer: This
material is for training purposes only to inform the reader of occupational safety and health
best practices and general compliance requirement and is not a substitute for provisions of the
OSH Act of 1970 or any governmental regulatory agency. CertiSafety is a division of Geigle
Safety Group, Inc., and is not connected or affiliated with the U.S. Department of Labor (DOL),
or the Occupational Safety and Health Administration (OSHA).
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