Using Benchmarking as a Recipe for Business Success

Benchmarking is a common term used in almost every industry. Is such, you have various types of benchmarking such is Healthcare Benchmarking, business benchmarking, industrial benchmarking, supply chain benchmarking etc.

Never Ending Target of Benchmarking

For example, in athletics, benchmarking is also used by athletes to set their targets of what they want to achieve and what or who they want to beat. A runner wishes to be the fastest and the fastest runner wishes to be faster than his or her previous record. Same goes for swimming, weightlifting, and even in team sports as well. This analogy is not far-fetched is it mirror’s what happens in other benchmarking efforts.

Organizations set the targets they want to beat and sometimes these targets are external (from competitors) and internal (improving beyond what they already do). The same is true in healthcare benchmarking. If an organization wants to be known as the best in its industry, commercial sector, or even in its niche, they must gain awareness of the only goal that matters – the one which none of your competitors have yet surpassed and they must surpass that and continue to surpass any personal goals they already achieved.

Benchmarking is a good way for an organization to not be complacent with its achievements

 

Of course, you can set that goal, or rather, that set of goals (because being the best in your business normally means you must beat the competition in a number of disciplines) yourself, but if it’s to exceed that of the very best today, you must know how well the very best is performing.

In business benchmarking or even supply chain benchmarking you can target to be better than the companies considered best in your sector or in your niche. As you continue to do this, you desire for growth and excellence becomes never-ending. There is always something that can be improved.

Setting a Benchmarking Target

After you set your target, you need to know what it will take to reach that target. Your company or organization needs to know what it must do in order to differentiate itself from others in its industry or in its environment.

One way to do this is by using external benchmarking. External benchmarking can provide you with that information, enabling you to plan your journey to supply chain excellence. Setting a performance target or target that exceeds the best in your industry or immediate business environment is the only way you can leverage benchmarking effectively to place you as an industry leader.

When you establish this, you can then identify the gap that needs to be closed. The gap: the distance between where an organization is performance wise and where it wants to reach with the help of benchmarking. Remember your organization must aim to beat the best and not to measure up to the best.

If you aim to be is good is the best, after you execute your plan, initiatives and efforts to match them you realize they have already improved their way of doing things as well. This ends up making you an industry follower and not an industry leader. By setting a more ambitious target, you may have a wider gap to close, but your organization also stands a better chance of being at the very front of the pack and becoming an industry leader if you can successfully implement the necessary improvements.

Continuous Benchmarking

When you’ve achieved your benchmarking target, you must not stop there. An organization should build a baseline for continuous improvement. Continuous benchmarking exercises are a great way to identify, set, and work toward continuous improvement goals. Benchmarking can be used to focus on work streams and recurrent work activities to always improve them in a continuous loop.

An organization can do this for all their workflow department or they can choose it for a number of specific areas that play an important role in the organization. By an organization benchmarking on a regular basis, it can review where it stands every couple of years and set new baselines to ensure continued forward momentum and growth.

Sustainable Supply Chain Benchmarking

This point refers to organizations in which the supply chain is an important part of their operations. Supply chain benchmarking is used to measure supply chain performance but it can also be used for much more. Supply chain benchmarking can be used to help solve very specific challenges, such as those associated with supply chain sustainability. Sustainability initiatives have something in common with service improvements, in that when they are implemented effectively, they can deliver significant cost savings in the course of achieving their primary environmental goals.

Sustainability Benchmarking

An increasing number of organizations have become more aware of the benefits of having sustainability in their supply chain and how well it affects their overall organization health and bottom line. Sustainability benchmarking is now commonly practiced by companies wishing to reduce environmental impact and strengthen corporate responsibility credentials.

The environment is important and when organizations are conscious of how their production or supply chain process affects this benchmarking it contributes to their overall effectiveness in their industry. Sustainability benchmarking can help you keep any number of environmental initiatives on track and moving in the right direction.

Some companies even seek to be industry leaders in sustainability by focusing on green energy, recycling, water usage, reduced pollution etc. As with other forms of supply chain benchmarking, you can choose to conduct internal or external sustainability benchmarking, depending on whether you wish to compare your environmental performance with other organizations, or simply want to set some standard internal improvement measures.