Global Benchmarking Network

Reinforcing competitive capacity with benchmarking as a management technique

Among management techniques, Benchmarking (BM) is gaining increasing significance. Its success is based on the many areas of application. It may be used as a tool to detect convoluted corporate structures or as an instrument to identify potential areas for improvement, in business processes as well as in areas concerning the strategic orientation of companies. According to recent surveys, most top managers realize that Benchmarking reinforces one’s competitive capacity. Especially for smaller and medium-sized companies, however, the practical application of Benchmarking seems to be difficult.

Benchmarking as a process in search for best practices

Benchmarking supplements traditional comparisons between companies. It is characterized by the systematic search for efficient procedures and better solutions for complicated problems and processes. The search focuses on external businesses, i.e., companies that belong to other branches of industry. The studies do not attempt to identify differences between companies, but best practices which help to obtain above-average competitive advantages. In particular, Benchmarking is characterized by the question: „Why do others do it better, what can we learn from this?“

An essential advantage of Benchmarking is the proven and visible applicability of new ideas in other companies, acting as a motivational factor for staff members of the visiting company. Looking beyond the limits of one’s own enterprise enables significant improvements in the performance. For companies of all industries, this makes Benchmarking to an outstanding instrument to improve the performance.

Benchmarking applied consistently, integrally and continually

Benchmarking should not be understood as a new miracle cure to improve the own competitive capacity. The novelty of Benchmarking is the comparison with the best across business lines and the setting of standards for the own company. The method of Benchmarking incorporates existing management techniques and will be successful if applied consistently, integrally, and continually. However, several prerequisites have to be fulfilled.