“ What is the OBJECTIVE of your presentation ?” Objective
“ Sir, Thanks for hiring me .But one small question, why is benchmarking?” what Benchmarking Department As per Sylvia Codling, Author of “Best Practice Benchmarking” “ Benchmarking is an ongoing process of measuring and improving products, services and practices against the best that can be identified worldwide”
Xerox Corporation 1984 “ Xerox Corporation fired me due to its poor results . I am just printing my resignation letter.” poor results
Return on assets fell to less than 8%.
Market share in copiers came down sharply from 86% in 1974 to just 17% in 1984.
Between 1980 and 1984, Xerox's profits decreased from $ 1.15 billion to $ 290 million .
“ I believe Japanese practice black magic to reduce costs ” reduce costs “ I Agree” Xerox Employees
In 1982, David T. Kearns (Kearns) took over as the CEO.
He discovered that the average manufacturing cost of copiers in Japanese companies was 40-50% of that of Xerox.
As a result, Japanese companies were able to undercut Xerox's prices effortlessly.
Kearns quickly began emphasizing reduction of manufacturing costs and gave new thrust to quality control by launching a program that was popularly referred to as 'Leadership Through Quality.'
“ We are cost cutting . You all are fired. We have appointed 2 Japanese employees in your place. Cutting cost Xerox Corp. Annual General Meeting
Supplier Management System
All Japanese companies put together 1000 supplier. Xerox had 5000 supplier.
Reduced suppliers from 5000 to 400
Created Vendor Certification process
Helped in revamping its manufacturing techniques.
Helped in recognizing its internal and external customers.
Helped in achieving Operational efficiency
Introduced Customer Satisfaction Measurement System that integrated customer research and benchmarking activities.
Sent 55,000 questionnaires monthly to its customers to measure customer satisfaction and record competitors performance.
“ There is so much improvement in Xerox, I guess they are using Black Magic” improvement Japan
Number of defects reduced by 78 per 100 machines.
Service response time reduced by 27%.
Inspection of incoming components reduced to below 5%.