Professional Documents
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Chapter 8: Benchmarking
The chapter 8 of Total Quality Management focuses in the benchmarking.
Benchmarking is measuring performance against that of best-in-class
organizations, determining how the best in class achieve those performance
levels, and using the information as the basis for goals, strategies and
implementations. It has two elements: the metrics which states that there
must be a unit of measure in measuring performance; and requiring the
managers understand why their performance differs.
The reason behind benchmarking are the following:
1. Benchmarking is a tool to attain business and competitive objectives.
2. It is powerful and effective when used for the right reasons and aligned
with organizational strategy.
3. It is not a remedy that can replace all other quality efforts or
management processes.
4. Benchmarking is one tool to help business organizations develop those
strengths and lessen weaknesses.
5. Benchmarking requires an external orientation, which is critical in an
environment where the competition can easily be on the other side of
the coin. An external outlook greatly reduces the chance of being
caught unaware by competition.
6. Benchmarking allows business organizations to be set objectively
based on external information.
7. Benchmarking is cost and time efficient.
8. Benchmarking partners provide a marking model of an improved
process, which reduces some of the planning, testing, and prototyping
effort.
9. The major weakness of benchmarking is the fact that best-in-class
performance is a moving target.
10. Benchmarking enhances innovation by requiring its practitioners
constantly to scan the external environment and to use the information
gathered to improve the process.
There are three Types of Benchmarking namely:
1. Internal data are easy to obtain because problems of confidentiality
dont exist. Often dialog with internal groups generates immediate
improvement ideas of defines common problems that help to focus
external inquiries.
2. Comparative Information can be difficult to obtain. Business
organization observes both its products and its competitors product in
use at the customers location and collects comparative data.
3. Process also known as functional or generic benchmarking. The idea
is that many processes are common across industry boundaries, and
innovations from other types of business organizations can be applied
across industries. It is much easier to get business organizations to
share information.
Companies must always seek development; which other companies does.
With this, benchmarking a strategy that organization use to have a
comparative analysis in the best practices in activities.