Benchmarking

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Benchmarking

  1. 1. What is benchmarking?Benchmarking is the continuous search for and adaptation of significantly better practicesthat leads to superior performance by investigating the performance and practices of otherorganisations (benchmark partners). In addition, it can create a crisis to facilitate thechange process.Benchmarking goes beyond comparisons with competitors to understanding the practices that liebehind the performance gaps. It is not a method for copying the practices of competitors, but away of seeking superior process performance by looking outside the industry. Benchmarkingmakes it possible to gain competitive superiority rather than competitive parity. The termbenchmark refers to the reference point by which performance is measured against. It is theindicator of what can and is being achieved. The term benchmarking refers to the actual activityof establishing benchmarks and best practices.It must be noted, however, that there will undoubtedly be difficulties encountered whenbenchmarking. Many of them are detailed in the corresponding document "Guide toBenchmarking" under "factors to be aware of". Significant effort and attention to detail isrequired to ensure that problems are minimised. Why do you need to benchmark?There are many benefits of benchmarking. The following list summarises the main benefits: provides realistic and achievable targets prevents companies from being industry led challenges operational complacency creates an atmosphere conducive to continuous improvement allows employees to visualise the improvement which can be a strong motivator for change creates a sense of urgency for improvement confirms the belief that there is a need for change helps to identify weak areas and indicates what needs to be done to improve.For example, quality performance in the 96 to 98% range was considered excellent in the early1980s. However, Japanese companies, in the meantime, were measuring quality by a fewhundred parts per million by focusing on process control to ensure quality consistency.Thus, benchmarking is the only real way to assess industrial competitiveness and to determinehow one companys process performance compares to other companies. Types of BenchmarkingThere are four types of benchmarking. They are not mutually exclusive and companies canchoose any one or a combination to meet their objectives. It is recommended that strategicbenchmarking is conducted first to create a context and rationale that will enhance all otherbenchmarking efforts.Strategic BenchmarkingConcerned with comparing different companies strategies and assessing the success of thosestrategies in the marketplace.Analyses the strategies with particular reference to:
  2. 2. strategic intent core competencies process capability product line strategic alliances technology portfolioShould begin with the needs and expectations of the customer. This can be achieved throughsurveys to measure customer satisfaction and the gaps between a companys performance and itscustomers standards.Ensures a co-ordinated strategic direction regarding benchmarking and reduces the possibilitythat one improvement project will cancel out the effect of another. Benchmarking candidates arenormally direct competition.The main difficulty is persuading the benchmark partner to discuss their strategy. However, thereis a great deal of information which can be obtained from customers, common suppliers andpublic domain information.Functional Benchmarking Investigates the performance of core business functions. Does not need to focus on direct competition but, depending on the function to be benchmarked, the benchmark partner may need to be in a similarly characterised industry for useful comparisons to be made.Best Practices Benchmarking Applies to business processes. It breaks the function down into discrete areas that are the targets for benchmarking and is therefore a more focused study than functional benchmarking. Some business processes are the same regardless of the type of industry. Attempts to benchmark not only work processes, but also the management practices behind them.Product Benchmarking Commonly known as reverse engineering or competitive product analysis. Assesses competitor costs, product concepts, strengths and weaknesses of alternative designs and competitor design trade-offs, by obtaining, stripping down and analysing competitors products.The four different types of benchmarking are evolutionary beginning with product, through tofunctional, process and strategic. For the purposes of this document and the correspondingdocument Guide to Benchmarking best practice benchmarking will be used due to its focus onprocesses. As benchmarking is becoming more widespread and companies are more proficient inits use, best practice benchmarking is becoming increasingly popular. This is also reinforced bythe move away from functionality in organisations towards business processes. For furtherinformation on the other types of benchmarking, see the references to Watson, Camp and Miller.
  3. 3. ConclusionBenchmarking must be a continuous process with the extent and scope of the project beingdependent on the resources that the company has available.The above key steps to benchmarking are detailed further along with a list of factors to be awareof in the companion document "Guide to Benchmarking". (Available on request) Key steps to benchmarkingBased on our research and experience we would recommend the following stages in yourBenchmarking projects: 1. Identify what to benchmark 2. Ensure management support and involve all stakeholders 3. Select the benchmarking team 4. Analysis of internal processes 5. Identify companies to benchmark 6. Decide on method(s) of data collection 7. Collect public domain information 8. Analyse collected information to establish what other information needs to be collected 9. Establish contacts with benchmark partners 10. Plan the actual visits 11. Conduct the benchmarking visits 12. Establish whether a performance gap exists 13. Predict future performance levels 14. Communicate benchmark findings 15. Establish targets and action plans 16. Gain support and ownership for the plans and goals 17. Implement the action plans, measure performance and communicate progress 18. Re-calibrate benchmarks 19. Adopt benchmarking on a company-wide scale
  4. 4. Hydro Electric Power Stations1.Mettur Dam2.Papanasam3.Lower Bhavani4.Cauvery5.Vaigai6.jeyamkondam Perambalur District-Commission AppointedMini Hydro Power Plants1.Aliya2.Lower Bhavani3.Pechiparai4.SathanurIndia was the 7th largest producer of hydroelectric power in 2008 after Norway: 114 TWh and3.5% the world total in 2008.[1] The potential for hydroelectric power in India is one of thegreatest in the world.In this system of power generation, the potential of the water falling under gravitational force isutilized to rotate a turbine which again is coupled to a Generator, leading to generation ofelectricity. India is one of the pioneering countries in establishing hydro-electric powerplants.The power plants at Darjeeling and Shimsha (Shivanasamudra) were established in 1898 and1902 respectively and are among the first in Asia.India is endowed with economically exploitable and viable hydro potential assessed to be about84,000 MW at 60% load factor. In addition, 6780 MW in terms of installed capacity from Small,Mini, and Micro Hydel schemes have been assessed. Also, 56 sites for pumped storageschemes with an aggregate installed capacity of 94,000 MW have been identified. It is the mostwidely used form of renewable energy. India is blessed with immense amount of hydro-electricpotential and ranks 5th in terms of exploitable hydro-potential on global scenario. The presentinstalled capacity as on 30-06-2011 is approximately 37,367.4 MW which is 21.53% of totalElectricity Generation in India.[2] The public sector has a predominant share of 97% in thissector.[3] National Hydroelectric Power Corporation (NHPC), Northeast Electric PowerCompany (NEEPCO), Satluj jal vidyut nigam (SJVNL), Tehri Hydro Development Corporation,NTPC-Hydro are a few public sector companies engaged in development of HydroelectricPower in India.Bhakra Beas Management Board (BBMB), an illustrative state owned enterprise in north India,has an installed capacity of 2.9 GW and generates 12000-14000 million units per year. The costof generation of energy after four decades of operation is about 20 paise/kWh.[citation needed] BBMBis a major source of peaking power and black start to the northern grid in India. Large reservoirsprovide operational flexibility. BBMB reservoirs annually supply water for irrigation to 125 lac
  5. 5. (12.5 million) acres of agricultural land of partner states, enabling northern India in its greenrevolution.

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