Bd bmk e

©Robere & Associates (Thailand) Ltd. Course: 20BDMK.01-S 1
Benchmarking: ABenchmarking: A
Systems Approach forSystems Approach for
Continual ImprovementContinual Improvement
Presented by:
Robere & Associates

Welcome to “Benchmarking”..Welcome to “Benchmarking”..
• Get to know each otherGet to know each other
• Get to know yourGet to know your
instructorinstructor
• Share with yourShare with your
classmatesclassmates
• Ask questionsAsk questions
• Have fun!Have fun!

Forward...this course was:Forward...this course was:
• Created to provide guidelines on the art and
science of Benchmarking
• Developed from 20 different approaches from
government and industry
• Designed around R&A Quality Philosophy
• Designed to link to other organizational
Quality programs.

Contents:Contents:
• What is Benchmarking
• Why Benchmark
• Types of Benchmarking
• The R&A Benchmarking Model
• Guidance for Conducting a
Benchmarking Study
• Supporting Materials

Team Exercise: 15 Minutes

This is a course in "Benchmarking". As a team, discuss:

1. What is Benchmarking?____________________________________________
2. How could Benchmarking help my company? _____ _____________________
3. Does anyone in your "team" have any experience in Benchmarking? If so, what?
_______
4. What are the three (3) major questions I want answered from this course?

Put your answers on the flip chart provided.

Definitions of Benchmarking :Definitions of Benchmarking :
XeroxXerox
Benchmarking is the continuous
process of measuring products,
services and practices against the
toughest competitors or those
companies recognized as industry
leaders.

Definitions of Benchmarking :Definitions of Benchmarking :
KodakKodak
A continuous learning process for
understanding and measuring our own
operations, comparing them to other
organizations which are recognized as
having superior practices, and
implementing plans to adapt and
change our operations, to meet and
surpass those practices

Background.Background.
• Xerox – late 1970’s with it’s copier
duplicator manufacturing division.
• Others have seen the benefits..
– Ford, Alcoa, Milliken, AT&A, DuPont, IBM,
Johnson & Johnson, Kodak, Motorola,
Texas Instruments and others..

Benchmarking will help us..Benchmarking will help us..
• find out what is the “best in class”
process..
• assess performance over time
• helps us with our objectives
• increase customer satisfaction
• become a better company..

Benchmarking - What it isBenchmarking - What it is
• Meeting Customer Requirements
• A Goal-Setting Technique
• An Ongoing Learning Process

Benchmarking is..Benchmarking is..
• an assortment of tools to help us
identify areas of improvement (one of
the major requirements of
ISO9000:2000, QS9000, ISO14000,
CIP, TQM,
• a culture of wanting to do better..by
comparison to others.

Benchmarking - What it is NotBenchmarking - What it is Not
• Only suitable for large projects
• The latest corporate fad
• Market research
• Industrial tourism - 80 to 90%
• Copying or stealing

Benchmarking - What it is NotBenchmarking - What it is Not
• A magic bullet
• A one shot program
• A one person effort
• Competitive intelligence

Why Benchmark?Why Benchmark?
• An objective evaluation of a company’s
business processes against similar processes
in other organizations
• Serves as a vehicle to source for
improvement ideas from other organizations
• Broadens an organization's experience base
by providing insights into methods that work
and those that don’t

Why Benchmark?Why Benchmark?
• Identify strengths and weaknesses for
improvement
• More improvement ideas to supplement
those of employees
• To remain competitive and achieve total
customer satisfaction

Team exercise: 20Team exercise: 20
MinutesMinutes
Now that your team has had a discussion of
Benchmarking, discuss and complete the
following Questions:
• Benchmarking is important to companies because____
• My "New" definition of Benchmarking is: _____
• Some examples of successful benchmarking projects are:
• Some reasons why I would want to benchmark some
processes in my company are: __

Type of BenchmarkingType of Benchmarking
• Internal Benchmarking – a comparison
inside the company
• Competitive Benchmarking – competitor
to competitor
• Functional Benchmarking – similar or
identical practices
• Generic Benchmarking – unrelated
business processes or functions

Internal BenchmarkingInternal Benchmarking
• Inside processes
• Can acquire the “best internal” practice
• Many examples of success: US Navy,
DOD, DOT, retail food chain
• Many advantages, but limits options for
growth.

Competitive BenchmarkingCompetitive Benchmarking
• Competitor to competitor
• Helps to know yourself and competitor better
• Can contrast others styles of operation for a
comparison
• Difficult in Thailand because “trade secrets
• Relatively low performance improvement

Functional BenchmarkingFunctional Benchmarking
• compares similar or identical practices
• find others to do similar practices better
• good use of international databases
(i.e. www.tbe.com)
• takes more time than internal or
competitive

Generic BenchmarkingGeneric Benchmarking
• looks for unrelated business processes that
are practiced in the same way
– transferring funds, order fulfillment
– bar coding, admissions, warehousing, etc.
• a broad look at how “generic” processes
compare
• high payoff - but high cost
• can compare to world-class but they have
many request...(internet may help)

Team Exercise: 15Team Exercise: 15
minutesminutes
As a team, you are to explain to Management the four type of
Benchmarks that your company might use. You will:
• Select a process within your company (in any department)
and select the best method to use to "benchmark" your
process.
• Explain why you've selected this method; why you think that
it is the best approach for your project
• What do you (your team) feel will be a problem using this
approach?

R&A Benchmarking ModelR&A Benchmarking Model
• Based on more then 20 benchmarking
models
• A “10-step” process using a “PDCA” (PDSA)
cycle common in ISO9000:2000
• The model is in-line with TQL approach
• Uses teams to identify, quantify, evaluate and
report on the benchmark initiative.
• Uses the Strategic Plan as input to the
system

ActAct
DoDoStudyStudy
PlanPlan Progress
StartStart
• Select a process to
evaluate
• Select and prepare team
• Identify benchmarking
partners
• Collect and analyze the
data
• Determine performance
gaps and strengths
• Take a systems view
• Communicate
benchmarking findings
• Establish functional goals
• Develop an action plan
• Recalibrate

Plan Phase: Step 1Plan Phase: Step 1
Select the process to benchmarkSelect the process to benchmark
• Look at the strategic plan
• Examine significant business
processes
• Create a process owner team (QMB)
• Identify type of benchmarking to use.
• Identify the goals of improvement

World Class
The "Best-in-Class
A best practice
An improvement over
current practices
A practice similar to the
current practices
What do you want to be?What do you want to be?

Select and prepare the BMK TeamSelect and prepare the BMK Team
• Create the team
• Clarify the roles and responsibilities
• Flowchart the process to be
benchmarked

Identify benchmarking partner(s) fromIdentify benchmarking partner(s) from
best-in-classbest-in-class
• Research information for best
practice
• Rank the potential partners (5-
15)
• Select final partners (1-5)
• Know and use benchmarking
guidelines for ethical conduct

Team Exercise for phase 1:Team Exercise for phase 1:
Planning (15 Min)Planning (15 Min)
The planning process is very important to
any project. In this "planning phase" of a
benchmarking program, what activities would you
do and why?

DODO Phase: Step 4Phase: Step 4
Collect and Analyze the DataCollect and Analyze the Data
• Determine the data collection
plan
• Collect and rank the data.
• Train BMK team in TQ
skills/tools as necessary

DODO Phase: Step 5Phase: Step 5
Determine performance gaps and strengthsDetermine performance gaps and strengths
• Analyze performance gaps and
strengths
• Produce a benchmarking report

Team Exercise: TheTeam Exercise: The dodo
Phase: (15 Min)Phase: (15 Min)
As with the previous exercise, define what activities
you would do in the "do" phase of the benchmarking
process.
_____________________________________________
How does this activity relate to the planning phase of
the process?
_____________________________________________

STUDYSTUDY Phase: Step 6Phase: Step 6
Take a Systems ViewTake a Systems View
• Study the BMK Teams report in
a “broader context”
• Top Management (ESC) makes
the final recommendations

Communicate benchmarking findingsCommunicate benchmarking findings
• Communicate widely and deeply
through the organization.
• Collect and analyze any
input/feedback

Establish functional goalsEstablish functional goals
• Write functional goals based on
best practices
• Have performance standards
and budget allocations reflect
new organizational goals

Team exercise for theTeam exercise for the
"study" phase (15 min)"study" phase (15 min)
• Phase three (3) of our benchmarking process
deals with "Study". What are we studying?
• Why are we studying these fact and data?___
• What will be the result of our "study"? How will
it help us to improve our company?_____

ACTACT Phase: Step 9Phase: Step 9
Develop an action plan, implementDevelop an action plan, implement
procedures and monitor progressprocedures and monitor progress
• Develop suggestions on how to
implement, measure and monitor
results
• Get top-level approval of the
plan
• Celebrate successes

ACTACT Phase: Step 10Phase: Step 10
RecalibrateRecalibrate
• Monitor the benchmark process
• Repeat the cycle...(1-10)

Team Exercise for "act"Team Exercise for "act"
phase (15 Min)phase (15 Min)
What "action" have we taken?
_____________________________
How does this phase relate to the "study" phase and
to the future of the benchmarking program?
______________________________________________
______________________________________________

Examples of BenchmarkExamples of Benchmark
ProjectsProjects
• “On-the-Job”
Training
• Hospital
• Hotel

On-The-JobOn-The-Job
TrainingTraining

What to Benchmark?What to Benchmark?
The OJT ProcessThe OJT Process
Job Identification
Preparation for OJT
Conduct of Task Analysis
Identification of Trainee Needs
Schedule of OJT
Trainee Coaching
Review of OJT Program

What to Benchmark?What to Benchmark?
• Performance measures
– Cost of OJT per worker
– % trained on OJT
– % moved up the skills ladder
– Cost of wastage as % of sales revenue
– Cost of rework as % of sales revenue
– Changes in output per worker
– Changes in cycle time

Whom to BenchmarkWhom to Benchmark
• Criteria for Selection
– not more than 1,000 employees with a
turnover of $100 million or less
– Production, customer service,
maintenance, and security functions should
be included
– Structured OJT program
– Recommended by PSB or ITE

Whom to BenchmarkWhom to Benchmark
• Best Practice Companies
– Delifrance Singapore Pte Ltd
– Scotts Holding Ltd
– TIBS Motors Pte Ltd
– YCH Distripark Pte Ltd
• Sent questionnaire

Key Findings on OJT PracticesKey Findings on OJT Practices
• OJT System
• Trainer
Preparation
• Trainee
Coaching

x Practices Changed Best Practices Fou
puterized system for L.L. Bean
ng warehouse orders
mless cylinder for copier
oreceptor Canon
uct Marketing Procter & Gamble
ce training practices IBM
-In-Time” methods Hewlett-Packard
l Quality Management Toyota, Fuji Xerox
ng & Collection American Express
loyee Suggestion Milliken

BenchmarkingBenchmarking
• Hospital program “Learning from the
Best”
• Learnt from the best practices of
leading organizations such as 5-star
hotels and airlines
– Accident and emergency cases
– Hot food

BenchmarkingBenchmarking
• Leading hotel
• Benchmarked a guest’s first 10 mins
contact, the check-in process
• Benchmarked against leading U.S.
hotel chain

Keys to SuccessKeys to Success
• Well-defined scope
• Stay within the scope
• Gain leadership concurrence
• Rigorous research to identify best
practices
• Know your performance
• Focus on improvements that will pay
and are visible

The Guidance Documents:The Guidance Documents:
• The step
• The input..
• Guidance Information
• The Output
• QA Checklist

Team Exercise and PresentationTeam Exercise and Presentation
• On the worksheet forms provided you are to
create a fictitious (make believe)
benchmark study.
• The steps of this study will include the
steps taken, the input-output of each step,
the results and the anticipated benefits.
• The Documented study will be presented to
management (the rest of the class) as you
would your own management... be prepared
to answer any questions.

Conclusion...Conclusion...
• Benchmarking is only a “tool” that we
use to continually improve our
company...it is not the “end-result”
• To improve...we must measure
ourselves against a “benchmark”
• Benchmarking leads us to other
quality improvement tools...they all
must work together.

Questions?Questions?

Bd bmk e

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