- January 25, 2022
- Posted by: Manuels Effe
- Categories: Finance & accounting, Insight
Essential today for good project cost control and the battle against corruption, promotion of continuous improvement, stimulation of process efficiency and effectiveness, and the addition of the much needed external perspective to an internal process to focus on what really matters, benchmarking has become the business word for measuring key metrics and practices and comparing them within business areas or against competitors, industry peers or other companies around the world to understand how and where an organization needs to change and improve performance.
Today in four parts, specifying:
1. Internal Benchmarketing, compares metrics (performance benchmarking) and/or practices (practice benchmarking) from different units, product lines, departments, programs, geographies, etc., within an organization.
2. External Benchmarking, which compares metrics and/or practices of one organization to another or others.
3. Performance Benchmarking, involving gathering and comparing quantitative data (i.e., measures or key performance indicators). Organizations use it as the first step to identify performance gaps.
4. Practice Benchmarking, the fourth involves gathering and comparing qualitative information about how an activity is conducted through people, processes, and technology.
Now taking the centre stage in all strata of life, it requires that as individuals, private and public organizations, we take advantage of it to improve processes, enhance productivity and obtain value for money in the utilization of scarce resources.