Bench Marking

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Most of us have at some point in time attended a seminar or talk on Benchmarking or read a book or article on this subject.  This is no new topic but I would like to visit the basic intent and purpose of benchmarking; though I will not get into the detail steps of benchmarking.

bench-marking-qg

Most of us have at some point in time attended a seminar or talk on Benchmarking or read a book or article on this subject.  This is no new topic but I would like to visit the basic intent and purpose of benchmarking; though I will not get into the detail steps of benchmarking.

 

Benchmarking can be defined as the process of improving performance by continuously identifying, understanding and adopting outstanding practices and processes found inside and outside the Organization. I think the most difficult part is to recognize a process outside our sphere of control and to accept and adopt it; for which we must have the ability to transcend the "not invented here" syndrome.  Organizations must be enthusiastic about adopting and learning ideas outside the organization. This is a key characteristic of a "learning organization"; and Eastman Kodak's expression of a learning organization is worth mentioning, "The decision to do benchmarking becomes no big issue in organization where there is a "learning leader' on the top of the heap.  This organization behaves as a learning organization.  I asked a manager how his benchmarking efforts were going.  He said, "We are no longer asking, why, we are asking how."  If organizational leaders are no longer asking, "Why do I have to do this?" and instead they are asking, "How do I do this?" you are halfway there"; unquote.  I think in an era where most big organizations adopt the business unit vertical organization structure, it's important to learn to adopt practices from other verticals within the organization.

 

Legends such as Henry Ford have used benchmarking; and it is said that by observing production methods in a Chicago slaughter house, Henry Ford got the inspiration for assembly line manufacturing. Another example is that of Telecommunication giant GTE discovered how to improve its field service by studying that of an elevator company.  And I understand that Ritz-Carlton hotel chain revamped its housekeeping process after benchmarking a competitor's hotel.  So the key is to search, find and learn; and not to worry if we are learning from an unrelated industry or from a competitor. 

 

In our company we have a corporate repository of all the successfully demonstrated practices (SDPs) within the organization.  People across the globe are encouraged to upload success stories from their area of responsibility into the SDP repository. The repository will also have synopsis of several closed green belt and black belt six sigma projects.  One could also place a standing request for updates by mail, when a particular category of SDP is uploaded.

 

Practice Vs Performance:  It is to be noted that benchmarking focuses on how to improve any given process by exploiting "best practices" rather than merely measuring the "best performance".  Best practices are the cause of best performance. Hence when we mention "best -in-class" we are actually talking of the best practice, though best practice eventually leads to best performance. Just like in cricket, if we benchmark Sachin Tendulkar's batting we are not targeting the centuries he scored but how he bats, the style of strokes, how different ball deliveries are handled, the bat selection, the practice and so on.

 

Not benchmarking I think is a loss, especially when there is a good practice in the same organization but in a different vertical or business unit. When there is a proven practice just across the road in another factory of the same organization, the best thing to do is to walk across and learn and adopt it.  Imagine a new Quality manager joining a business unit of the organization and hiring a consultant to develop and implement Quality Management Systems, when everything is available on a platter in another vertical next door. Reinventing the wheel is a huge waste of time; speed is what business
calls for.

 

If you Google on "Benchmarking" there are hundreds of sites thrown up and one such site I found is the Benchmarking Exchange, which is a online benchmarking and Best Practices Network, I guess you could get a lot of information there. Also listed are the top 10 benchmarking organizations. The International Benchmarking Clearing House, a service of the American Productivity and Quality Centre, has adopted a common "Benchmarking Code of Conduct" to contribute to efficient, effective and ethical benchmarking. Without getting into the nitty-gritty's of benchmarking code and process, I would urge organizations to  tread the path of a "Learning Organization" if not so already, and to keep eyes and ears open to benchmark the best processes which are freely available today. I am reminded of how the MD of our Shanghai facility sent the Operational Excellence team to have lunch at a Japanese Sushi bar, to see how concepts of Lean Manufacturing was used in the food service; which could be applied in manufacturing.

 

Trade organizations such as CII, MAIT and ELCINA normally organizes factory visits for their members to help learn and benchmark the best practices and I think one must use these forums to get an insight of the good practices in other organizations. 

 

Pradeep Kumar E.T. A Master Black Belt in Six Sigma , is the Country Manager- Operational Excellence with Tyco Electronics Corporation India Pvt Ltd. Feedback can be e- mailed to pradeep@businessgyan.com

Issue BG76 July07