BENCHMARKING AND QUALITY

Benchmarking and Quality Circles



Benchmarking and Quality Circles

Benchmarking to Measure Companies

Benchmarking is a vital tool for an organization to measure themselves with the competitors. Benchmarking is a comparison of an organizations practices with those of other organizations, in order to identity ideas for improvement and potentially useful practices, and sometimes to compare relative standards of performance. There are two necessary forms. The first is competitive benchmarking, where the benchmarks are conventionally expressed as measured reference goals for aggregate performance, such as the output of a production line (Camp, 1999, pp. 250). The other is process competitive benchmarking, where teams may visit another organization, often in an unrelated industry, to study related business processes.

Implementation at Xerox

Process competitive benchmarking was used extensively early on at Xerox to learn from other organizations, and it was linked to the company's business excellence model. “For instance, it used a study of the London ambulance service to improve its emergency call- out service for its engineers to visit customers. More recently, however, benchmarking has been scaled down and is used mainly as an internal activity to compare practices across Xerox's business units. Its internalization results from two difficulties: the problem of obtaining access to other organizations and the cost and time it has involved.

Benchmarking is useful for smaller projects, but as an approach for understanding organization-wide systems, it has problems. Part of the problem is that managers not only do not understand the other organization as a whole system, they also do not always understand their own in these terms (Dattakumar & Jagadeesh, 2003, pp. 176). All common frame works are likely to need modification for individual applications and specific contexts. It is not a case of copying practice per se. but rather that benchmarking can be a useful catalyst for ideas and change.

From the resource-based view of strategy, the replication of best practice may be illusive, since the managerial practices that are most central to competitive advantage are likely to be specific to an independent organization, and irrelevant to another organizations strategic management. Michael Porter agrees, but for a different reason, when he thinks that those capabilities, categorized as originally Japanese, can be copied, and in that sense cannot be sources of lasting competitive advantage, but only of operational effectiveness.

Benchmarking through SWOT

Companies can use the tool of SWOT to measure itself strategically and to create benchmarks. One traditional element of strategic thinking is SWOT analysis, which stands for strengths, weaknesses, opportunities, and threats. An examination of the outer world has clear implications for the threats and opportunities that societies and organizations must confront. One traditional element of strategic thinking is SWOT analysis, which stands for strengths, weaknesses, opportunities, and threats (Johnson, 1996, pp. 77). Many strategists use an ordinary template to track major spheres in which change is occurring, often called an environmental scan. Strategists focus on broad categories such as the political, economic, social, environmental, and technological dimensions of change. In each sphere, strategic thinking develops sources of information and various methods of ...