BENCHMARKING:

A CONTINUOUS PROCESS OF MEASURING OWN

VITAL FACTORS AGAINST OWN PAST OR LEADERS
OR COMPETITORS

Benchmarking is the process of comparing

Benchmarking tools are simple or complex ratios
(indicators)
Indicators are made up of business results such as revenue,
costs, added value, etc.

Issues: Identifying indicators, availability of data, comparisons at enterprise

level vs. own past results or between enterprises.
EPIC, GOLEM IMS GMBH, Austria

BENCHMARKING EXAMPLES

Comparing

similar

factors in

the same or

different

enterprises

e.g.:
==>

Performance of wood furniture manufacturing

in two different enterprises e.g.

how
how
how
how
how
how
how

materials are purchased

suppliers are paid
inventories are managed
employees are trained
payrolls are processed
fast new products get to the market
quality is managed

KPI change in given industrial sector over

time
Comparing performance of key industrial
sectors in a region or country
Comparing performance of regions or
countries
EPIC, GOLEM IMS GMBH, Austria

BENCHMARKING - CONCLUSION

Important tool for entrepreneurs, consultants and policy

makers
Difficulties in obtaining data
Sensitivity of entrepreneurs to releasing data
Data validity verification
Incentives for entrepreneurs taking part
Cultural differences

It is a critical technique for making organizational transformation easy

It requires a certain threshold of organizational willpower
companies unable to muster the willpower to compare themselves with its
past and with the world's best cannot implement any quality approach
benchmarking demonstrates the requisite willpower or its absence
EPIC, GOLEM IMS GMBH, Austria

SUMMARY:

Benchmarking is a Process!
Benchmarking is not a goal in itself but
helps identifying areas requiring further
analysis and improvements.
Extensive and systematic comparison
using more than one variable.
Trend implementing a benchmarking
approach.
EPIC, GOLEM IMS GMBH, Austria

Pharos Benchmarking
Objectives

Obtaining information about absolute and relative change

of major business indicators for the current date
compared to some reference date in the past.
Presenting this information in easy way for analysis such
as radar graph and time series graphs.
Providing trend identification and analysis tools by using
simple variable averaging method.
Allowing flexibility in defining any desirable averaging
period within interval of 1-12 months.
Using actual data available in Pharos and Produce Plus
enterprise databases for obtaining objective results.
EPIC, GOLEM IMS GMBH, Austria

Objectives

Minimizing possibilities for subjective judgments

by individuals due to diversity of qualifications
methods and errors.
Avoiding questionnaires, sensitive proprietary
information, its processing, human errors,
incompetence as well as delays in getting results.
Obtaining benchmarking results easy, simple and
quickly at any moment of time.
Supporting presenting only relative change figures
in percent in business reports avoiding revealing
sensitive key performance indicators
Facilitating public discussions of performance
management issues and knowledge distribution.
EPIC, GOLEM IMS GMBH, Austria

7 Indicators

Net Profit (Pre Tax)

Expenses Overall
Sales Revenue
Overall Added Value
Overall Added Value per Employee
Labor Ratio (Produce Plus)
OEE (Overall Equipment Efficiency, ProdPlus)

EPIC, GOLEM IMS GMBH, Austria

Formats

Radar Chart

Time series

Period

Averaged

Brief Summary Report

Detailed Summary Report

EPIC, GOLEM IMS GMBH, Austria

Reference Benchmarking:
Added Value per Employee

EPIC, GOLEM IMS GMBH, Austria

Reference Benchmarking:
Net Profit

EPIC, GOLEM IMS GMBH, Austria

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Reference Benchmarking:
Expenses

EPIC, GOLEM IMS GMBH, Austria

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KPI Change: Absolute & Relative

EPIC, GOLEM IMS GMBH, Austria

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Pharos Benchmarking:
Definition of parameters

EPIC, GOLEM IMS GMBH, Austria

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Reference Benchmarking:
Summary

EPIC, GOLEM IMS GMBH, Austria

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EPIC, GOLEM IMS GMBH, Austria

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EPIC, GOLEM IMS GMBH, Austria

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Conclusions

Pharos Benchmarking is simple and effective tool

The source data is real enterprise database not
questionnaires or third party interviews
It presents both absolute and relative values of change
Available for entrepreneur in continuous improvement
process by mouse click at any time
Relative improvement reports can be easily presented to
prospective investors, banks or important customers
The report is be additional validation to business proposal
Benchmarking helps evaluating business development
scenarios, decision consequences, innovations, strategies
Excellent educational and business gaming tool
The benchmarking reports can be used for support of
policy making for clusters, regions, countries
Can be used for multiple enterprises (XML reports)
Can be further extended with benchmarking indexes
EPIC, GOLEM IMS GMBH, Austria

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