TQM - RECOGNITION, REWARD, PERFORMANCE APPRAISAL - FINAL YEAR ECE - SRI SAIRAM INSTITUTE OF TECHNOLOGY, CHENNAI - Dr.K.BARANIDHARAN

2. Dr.K.Baranidharan
Present by…

3. RECOGNITION/REWARD/
PERFORMANCE
APPRAISAL
Presented by
Dr.K.Baranidharan

4. ECE

5. BENCH MARKING

6. • The word „benchmark‟ is a reference or
measurement standard used for
comparison.
• Benchmarking is the process of
determining who is very best, who sets
the standard, and what that standard
is.
• Benchmarking is a systematic method
by which organisations can measure
themselves against the best industry
practices.

7. • Measuring an organisation’s performance
against that of best-in-class
companies, determining how the best-in-
class achieved those performance level.
• It is a tools for continuous improvement.
• “The process of
identifying, understanding, and adapting
outstanding practices and processes from
organisations anywhere in the world to an
organisation to improve its
performance”.American Productivity and
Quality Centre (APQC)

8. “Benchmarking is the search for
industry best practices that lead to
superior performance”
by Robert Camp

9. Benchmarking
Valuable TQM tool which accomplishes objectives of
customer satisfaction and continuous improvement.
Motivates an organization & fosters a new in-depth
understanding about the functioning of the
organization.
Reduces cycle time as small or big tasks get done
faster.
Constantly redefines standards which must be
achieved to remain competitive.
Increases productivity.

10. OBJECTIVE
• To determine what and where
improvements are called for
• To analyze how other organizations
achieve their high performance
levels, and
• To use this information to improve
performance.

11. Purpose of Benchmarking
• Comparing an organization’s performance
to the best organization’s performance
• Comparing an organization’s business
process with similar process
• Comparing product and services
• Identify the best practices to implement
• Projecting trends

12. The Evolution of Benchmarking
Evolved in the early 1950s, when W. Edward
Deming taught the Japanese the idea of
quality control.
Example
Toyota Motor Corporation’s following the
footsteps of Ford Motor Corporation with the
adaptation of the Ford’s Just-in-case System
into Toyota’s Just-in-Time System.

13. Term “Benchmarking” emerged in
1980s by ROBERT CAMP, logistics
engineer who initiated Xerox’s
benchmarking program.
Use of benchmarking worldwide
continues to grow since Robert
Camp wrote the first book on
benchmarking in 1989.

15. Benchmarking Process Model
Search
Observe
Analyze
Adapt Plan

16. Steps in Bench Marking Process
1. Plan
• Select the process
• Form Team
• Understand & document process
• Establish performance measure

17. 2. Search
• Listing Criteria for partner selection
• Conduct general / secondary
research
• Decide the level to Benchmark
• Identify potential partners & contact

18. 3. Observe
• Questionnaire sent to partner
• Telephone contact
• Direct observation / site visit

19. 4. Analyze
• Sort information & data
• Quality control information & data
• Normalize data if necessary
• Identify gaps in performance Level
• Identify causes for gaps

20. 5. Adapt
• Identify improvement
opportunities
• Set target for improvement
• Develop implementation plan,
monitor the progress
• Write final report

21. • Customer service levels
• Inventory management
• Inventory control
• Purchasing
• Billing and collection
• Purchasing practices
• Quality process
• Warehousing and distribution
• Transportation
AREAS TO BENCHMARK

22. Types Of Benchmarking
Internal
External
Performance or Competitive
Functional
Generic
Strategic
Process

23. Internal Benchmarking
Comparison of similar functions in different
operating units within the organization
Example
• Tata Steel’s Colliery divisions benchmarking
their maintenance practices with that of the
Maintenance division inside the Steel Works
at Jamshedpur.

24. External Benchmarking
Comparison of organization
functions and key processes
against external good practice
organization.

25. Performance or Competitive
Organizations using performance
measures to compare themselves against
similar organizations
Example
• FMCG’s comparing with each other for
Market share, Retention rates, profits,
costs.

26. Functional Benchmarking
Comparison of similar functions against
external best in any industry
Example
• Hindustan Max – GB Ltd , a
pharmaceutical company, benchmarking
their maintenance function with that of
Tata Steel.

27. Generic Benchmarking
Comparison of functions which are generic
in nature in any industry
Examples
• Hospital in the U.S. routinely benchmark
their patient management against hotel’s
guest management.
• Airlines benchmark their customers
service with 5 star hotels.

28. Strategic Benchmarking
Used where organizations seek to
improve their overall performance by
focusing on specific strategies or
processes
Example
• Benchmarking against organizations
which have won awards or some other
distinctions

29. Process Benchmarking
Focus on specific operations or processes
Examples
• In higher education - Enquiry
Management, Enrolment
• In Logistics - Delivery, Safety.
• In hotels - Housekeeping, Customer Care.

30. Issues in Benchmarking
Finding suitable partners.
Difficulties in comparing data (50%
of organizations found this)
Resource constraints (Time, Finance
and Expertise)
Staff resistance.

31. Benchmarking Tools
• Matrix technology
• Comparison tables
• Graphs: Pie chart, Bar chart /
Histogram
• SWOT analysis Potential/resources-
analysis
• Price/performance ratio
• Potential analysis
• Life cycle analysis
• market growth/market share portfolio

32. • market attractiveness
• Portfolio attractiveness customer
• Technology/resource strength
• Market position
• Contribution margin
• customer satisfaction portfolio
• Revenue share
• Spider web diagram

33. Benefits of Benchmarking
 Improves organizational quality
 Leads to lower cost
 Creates buy-in for change
 Exposes employees to new ideas
 Broadens organization’s perspective
 A catalyst for learning
 Increase employee satisfaction
 Test the internal operating target
 Raise the level of potential performance
 Sharing of best practices
 Understanding world-class performance in-depth
 Encourage and stimulate innovation

34. Pitfalls and Criticisms of
Benchmarking
 The most persistent criticism of
benchmarking comes from the idea of
copying others.
 Benchmarking isn’t very helpful if it is
used for processes that don’t offer much
opportunity for improvement.
 Benchmarking is also not a substitute for
innovation

35. Disadvantages of Benchmarking
• Increase the diversity of
information so the potential for
information overload
• May reduce managerial motivation
when comparing with a better
resourced rival
• Confidentiality of data may be a
risk

36. Ejemplos
Xerox, Hewlett Packard, Ford y General
Motors

37. Dr.K.Baranidharan
THANK YOU