Benchmarking
Definition: What is Benchmarking?
Benchmarking is the process of comparing an organization’s quality of corporate systems, policies, products, programs and strategies to standard measurements as well as to other companies’ results.
These results are used to help determine if and what improvements and/or changes are required in any of the benchmarked fields, as well as analyzing competitors’ performance, using this information to evaluate the benchmarking company’s performance, also.
In general, benchmarking is used to compare a company’s performance to competitors who have had the best results in the field. The basic data used for benchmarking include quality, time and cost. To begin the benchmarking process, a company has to identify its best rivals or corporations that use similar methods to produce goods and/or services, using whatever kinds of intelligence are required, consider the results achieved by competition as targets, and apply their winning ways to their own methods of doing business.
In fact, it is the business processes as such that are the most important criterion for benchmarking.
Some companies use benchmarking as a tool to be used occasionally only, but those companies that are their respective fields’ leaders use this method continually.
See also Wikipedia’s definition of benchmarking