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Benchmarking for World-class Performance by Operational Excellence Consulting
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Benchmarking for World-class Performance by Operational Excellence Consulting

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Benchmarking is the process of continually searching for the best methods, practices and processes, and either adopting or adapting their good features and implementing them to become the “best of the …

Benchmarking is the process of continually searching for the best methods, practices and processes, and either adopting or adapting their good features and implementing them to become the “best of the best.” To become the best-in-class, organizations need to implement the right process to get there.

This presentation deck covers the benefits of benchmarking, various types of benchmarking, identifying what to benchmark, and provides a detailed step by step guidance on how to systematically carry out a benchmarking project based on the world-renown Xerox benchmarking model. It also includes useful tips on benchmarking, benchmarking etiquettes and the critical success factors.

​LEARNING OBJECTIVES

1. Explain what benchmarking is
2. Acquire the benchmarking process know-how based on the four-phase, ten-step Xerox Benchmarking model
3. Determine the best processes to benchmark to meet your needs
4. Define the critical success factors in benchmarking implementation

CONTENTS

Introduction to Benchmarking
What is Benchmarking?
Why Benchmark?
Four Phases of Benchmarking
Preparation for Benchmarking
The Benchmarking Process
Step-by-step: Xerox Benchmarking Process
- Step 1: What to benchmark?
- Step 2: Whom to benchmark?
- Step 3: Data collection
- Step 4: Determine current performance “gap”
- Step 5: Project future performance levels
- Step 6: Communicate findings and gain acceptance
- Step 7 Establish goals
- Step 8: Develop action plans
- Step 9: Implement actions and monitor progress
- Step 10: Re-calibrate benchmarks
Benchmarking Checklist
Benchmarking Etiquette
Benchmarking Site Visit
Benchmarking Pitfalls & Success

To download this complete presentation, please visit: http://www.oeconsulting.com.sg

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  • @fakrullah, Thank you for liking the BM presentation. To download the slides, please go to:
    http://www.oeconsulting.com.sg/#!ppt-benchmarking/c1xv4
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  • Dear Sir,

    I do really need your slides. Where can I get these slides? I am part time student and doing research in strategic management. Please send me these slides to fakrul@klrca.org
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  • Could you email a copy of the presentation please. Rgds Michael
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    I am doing my Ph.D research on Benchmarking.
    Please share the soft copy of the presentation.

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    Somnath
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  • Dear Sir,

    Can you send me the above presentation on this email, as i have a task regarding benchmarking a process in our organization.
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  • 1. 1© Operational Excellence Consulting. All rights reserved.© Operational Excellence Consulting. All rights reserved. Benchmarking for World- Class Performance
  • 2. 2©Operational Excellence Consulting. All rights reserved. • Explain what benchmarking is • Acquire the benchmarking process know-how based on the four-phase, ten-step Fuji-Xerox Benchmarking model • Determine the best processes to benchmark to meet your needs • Define the critical success factors in benchmarking implementation
  • 3. 3©Operational Excellence Consulting. All rights reserved. • Introduction to Benchmarking • The Benchmarking Process – An Overview • Step-by-step: Fuji-Xerox Benchmarking Process • Critical Success Factors
  • 4. 4©Operational Excellence Consulting. All rights reserved. “Even if you are on the right track, you’ll get run over if you just sit there.” - Will Rogers Introduction to Benchmarking
  • 5. 5©Operational Excellence Consulting. All rights reserved. Time Performance Gap Customer Expectation Dilemma Introduction to Benchmarking
  • 6. 6©Operational Excellence Consulting. All rights reserved. Why Benchmark? 1. Productivity improvement 2. Meeting customer requirements 3. A goal-setting technique 4. An on-going learning process Introduction to Benchmarking
  • 7. 7© Operational Excellence Consulting. All rights reserved. Benchmarking – With & Without • Internal focus • Not invented here • “Gut feel” decisions • Evolutionary change • Industry laggard • External, competitive focus • Breakthrough ideas & learning • Fact-based decisions • Revolutionary change • Industry leader Without Benchmarking With Benchmarking Introduction to Benchmarking Source: Benchmarking from A to Z by Kay Kendall, 1999.
  • 8. 8©Operational Excellence Consulting. All rights reserved. What is Benchmarking? • Benchmarking is the process of identifying, sharing and using knowledge and best practices. • It is a continuous process to find and implement best practices that will lead to superior performance. Introduction to Benchmarking
  • 9. 9©Operational Excellence Consulting. All rights reserved. What Benchmarking is NOT • Number crunching • Site briefing • Industrial tourism • Copying • Spying or espionage Introduction to Benchmarking
  • 10. 10©Operational Excellence Consulting. All rights reserved. Four Phases of Benchmarking Phase 1: Planning Phase 2: Analysis Phase 3: Integration Phase 4: Action Benchmarking Process
  • 11. 11©Operational Excellence Consulting. All rights reserved. Benchmarking Process Benchmarking Process Steps 1. IDENTIFY WHAT IS TO BE BENCHMARKED 2. IDENTIFY COMPARATIVE COMPANIES 3. DETERMINE DATA COLLECTION METHOD AND COLLECT DATA 4. DETERMINE CURRENT PERFORMANCE “GAP” 5. PROJECT FUTURE PEROFMANCE LEVELS 6. COMMUNICATE BENCHMARK FINDINGS AND GAIN ACCEPTANCE 7. ESTABLISH FUNCTIONAL GOALS 8. DEVELOP ACTION PLANS 9. IMPLEMENT SPECIFIC ACTIONS AND MONITOR PROGRESS 10. RECALIBRATE BENCHMARKS  LEADERSHIP POSITION ATTAINED  PRACTICES FULLY INTEGRATED INTO PROCESSES Phase 1: PLANNING Phase 2: ANALYSIS Phase 3: INTEGRATION Phase 4: ACTION MATURITY
  • 12. 12© Operational Excellence Consulting. All rights reserved. Basic Question : • Determine the significant area/activities that will improve performance and enable the business units to achieve operation vision and objectives Identifying the Subject for Benchmarking Step 1: What to Benchmark?
  • 13. 13©Operational Excellence Consulting. All rights reserved. Tip: Measurables must be defined as specifically as possible (SMART) Level 1 Level 2 Level 3 Broad area or subject of investigation Business process or functional activity Specific process description or measures of specific activities e.g. department or function – too broad to involve any type of measurement e.g. number of customer complaints, no. of billing errors e.g. process for reducing scrap rate by product line Critical Success Factor Step 1: What to Benchmark?
  • 14. 14©Operational Excellence Consulting. All rights reserved. Summarize Purpose of Study • A brief statement of the purpose of study • The subject of study • The measurement involved • Indicate how output will help run the business Step 1: What to Benchmark?
  • 15. 15©Operational Excellence Consulting. All rights reserved. Types of Benchmarking • Internal benchmarking • Functional benchmarking • Process benchmarking • Performance benchmarking • Competitive benchmarking • Generic benchmarking Step 2: Whom to Benchmark?
  • 16. 16©Operational Excellence Consulting. All rights reserved. Identify the Best Firm • Select key data and developing common business effectiveness ratio  e.g. Percentage of revenue, return of assets • Sources  Public domain  Professional associations • Other sources  Contacts, vendors, functional professionals  Conferences Step 2: Whom to Benchmark?
  • 17. 17©Operational Excellence Consulting. All rights reserved. Data Collection Plan 1. Select method(s) for data collection 2. Decide who to construct data collection instrument 3. Identify (by name) sources of information 4. Describe data interested and method of data collection 5. Establish the schedule for data collection 6. Develop the data collection instrument 7. Decide on interviewer / who to collect data 8. Agree on deadlines for data collection and analysis Step 3: Data Collection
  • 18. 18©Operational Excellence Consulting. All rights reserved. Value of Information-Gathering Methods (5 = most favorable; 1 = least favorable) Selecting Methods of Conducting Research Mail Phone Visit Focus Group Amount of data 2 3 5 5 Accuracy of data 2 4 5 5 Sample size 5 3 2 3 Response rate 2 4 5 5 Cost per interview 5 4 2 3 Time requirements 2 5 2 1 Flexibility 1 4 5 1 Special skills 3 4 5 1 Administration 5 4 2 1 Step 3: Data Collection
  • 19. 19©Operational Excellence Consulting. All rights reserved. Six Basic Steps 1. Organize data 2. Measure your own performance 3. Determine the benchmark 4. Check for gap 5. Evaluate reasons for the gap’s existence 6. Develop a list of enablers that leads to best practices Step 4: Determine the Current Performance Gap
  • 20. 20©Operational Excellence Consulting. All rights reserved. Projection of Gap Step 5: Project Future Performance Years Summary Measure BIC Practice Your Practice Superior Performance Benchmark Gap Today End-Point
  • 21. 21©Operational Excellence Consulting. All rights reserved. Analyze Data • Are the any trends? (from step 4 results) • If data unavailable:  The team makes its own judgement • Determine gap status  Widening or Closing  Size of the Gap • Document any assumptions made Step 5: Project Future Performance
  • 22. 22© Operational Excellence Consulting. All rights reserved. Spider or Radar Chart M1 M6 M4 M5 M7 M3 M2M8 Total customer satisfaction (ultimate goal) Best of best (benchmark) Current performance (baseline) Step 5: Project Future Performance
  • 23. 23©Operational Excellence Consulting. All rights reserved. Step 6: Communicate Findings & Gain Acceptance Communicate Findings • No matter how well the benchmarking study has been conducted there is often a natural resistance to the introduction of new practices, even if they are best practices. • Overcoming the reluctance to accept the findings is an important step toward implementation. Hence a carefully designed communications campaign should be given serious consideration. • The goal of such a campaign is to gain the acceptance of directly affected management.
  • 24. 24©Operational Excellence Consulting. All rights reserved. Guidelines for Organizing Analysis Information • Executive summary  Key results  Conclusions  Recommendations • Study process  Respondent selection  Methods employed to gather data  Analysis techniques Step 6: Communicate Findings & Gain Acceptance
  • 25. 25©Operational Excellence Consulting. All rights reserved. Gaining Acceptance • Initiative for change • Benchmark findings phrased as operational principles • Validation from multiple sources Step 7: Define Functional Goals
  • 26. 26© Operational Excellence Consulting. All rights reserved. Goal Setting, Action Planning Process & Relationship to Benchmarking BENCHMARK PROJECTS IMPLEMENTED BENCHMARK PRACTICES FINDING INCORPORATED Mission Planning Principles Performance Goals Strategies Implementation Tasks Step 8: Develop Action Plan
  • 27. 27©Operational Excellence Consulting. All rights reserved. Ways of Implementing Benchmark Practices • Line Management • Project Team • Process Manager • Work Team Step 9: Implementing Action & Monitoring Progress
  • 28. 28©Operational Excellence Consulting. All rights reserved. Benchmarking Protocol Policy regarding benchmarking protocol should be communicated to all employees involved, prior to contacting external organizations. Guidelines should address the following areas: • Misrepresentation – do not misrepresent your identity in order to gather information • Information requests – a request should be made only for information your organization would be willing to share with another company • Sensitive / proprietary information – avoid direct benchmarking of sensitive or proprietary information • Confidentiality – treat all information as confidential Benchmarking Etiquette
  • 29. 29©Operational Excellence Consulting. All rights reserved. Site visit IS NOT “Industrial Tourism” Benchmarking Site Visit
  • 30. 30©Operational Excellence Consulting. All rights reserved. 10 Benchmarking Mistakes to Avoid 1. Confusing benchmarking with participating in a survey 2. Thinking there are pre-existing “benchmarks” to be found 3. Forgetting about service delivery and customer satisfaction 4. The process is too large and complex to be manageable (“boiling the ocean”) 5. Confusing benchmarking with research Benchmarking Mistakes to Avoid
  • 31. 31© Operational Excellence Consulting. All rights reserved. Attributes of Benchmarking Studies: Success vs. Failure Success Failure Process Owner Involvement Customer Driven Objectives Linked to Strategic Plan Best Practices & Enablers Consider Cultural Attributes Disciplined Methodology Quantum Change Clear Project Life Cycle Integrated with Existing Quality Efforts Sponsorship Uncertain Amorphous Objectives No Strategic Integration Performance Metrics Only “Hard” Data Only Arbitrary / Casual Approach Incremental / No Change Keep Going and Going and ….. A la carte Program Critical Success Factors
  • 32. © Operational Excellence Consulting. All rights reserved. To download this presentation, please visit us at: www.oeconsulting.com.sg END OF PREVIEW