Benchmarking In Total Quality Management

This ppt explained the basic concept and history of benchmarking in total quality management. Also explains the objectives, types of benchmarking and the process involved in benchmarking.

1. BENCHMARKING IN TQM Submitted By, M. Pratheep , ICE – 4 th Year, SCE, Trichy.

2. BENCHMARKING : Benchmarking is a way to go backstage and watch another company’s performance from the wings, where all stage tricks and hurried realignments are visible. A merican productivity and Quality Centre (APQC) has defined the Benchmarking as “the process of measuring an organization’s internal processes then identifying, understanding, and adapting outstanding practices from other organizations considered to be best-in-class”.

3. BENCHMARKING : David Kearns has defined the Benchmarking as the continuous process of measuring products, services and practices against the toughest competitors. Thore defines the Benchmarking as The systematic comparison of elements of performance of an organization against those of other organizations, usually with the aim of mutual improvement .

4. BENCHMARKING CONCEPT :

5. OBJECTIVES OF BENCHMARKING : Benchmarking aims at a goal setting process to facilitate comparison with the best. It aims at motivating and stimulating company employees towards the goal of continuous quality improvement. It aims at external orientation of the company. It aims at identifying a technological break-through.

6. This refers to comparison of different features and attributes of competing products and services. It is also called as ‘customer satisfaction benchmarking’ or ‘customer value profiling’. TYPES OF BENCHMARKING : Classification based on the object to be benchmarked: Product benchmarking : Performance benchmarking : This refers to comparison of performance indicators related to a business as a whole or to the group of critical activities or processes.

7. Process benchmarking : This refers to comparison of processes. It identifies a more effective and efficient process to be implemented. Strategic benchmarking : This refers to examining competitive position in the market place. It helps the company to study the business strategy for becoming more competitive.

8. 2. Classification based on the organizations against whom one is benchmarking : Internal benchmarking: It refers to comparison of performance between departments, plants, subsidiaries, etc., within the organization. Industry benchmarking :  It refers to comparison of performance by the organization producing the same class of products and services.  Competitive benchmarking : It refers to comparison of performance against direct competitors.

9. Best-in-class benchmarking :  It refers to comparison of performance with best practices prevalent in an organization irrespective of products and services. Relationship benchmarking :  It refers to comparison of performance with the benchmarking company which already has relationship like customer-supplier relations, joint venture arrangement, etc.

10. STEPS IN BENCHMARKING PROCESS : Phase I: Planning : The planning phase involves into three steps : To identify , what is to be benchmarked? ( i.e , Deciding what to benchmark) To whom or what shall we compare? ( i.e , Identifying benchmark partners) H ow will the data be collected? ( i.e , Examine the process and underlying working methods of partners)

11. Phase II : Analysis : The analysis phase involves a careful understanding of current process practices as well as those of benchmarking partners. This phase consists of the following two steps Determine the current performance gap - Determine the gap between the performance level of the organization and that of its benchmark partner. Project future performance levels - The gap is a projection of performance. Therefore the performance will change as industry practices change.

12. Phase III: Integration : Integration is the process of using benchmark findings to get operational targets for change. This phase consists of the following two steps ; Communicate Benchmark Findings And Gain Acceptance - Demonstrate the benchmark findings to the management for their acceptance Communicate the benchmark findings to all organizational levels to obtain support, commitment and ownership. Establish Functional Goals - On the basis of communicated data and acceptance of analysis, establish the functional goals and achieve them through the benchmarking process.

13. Phase IV : Action : The action phase encompasses the following three steps ; Develop Action Plans. Implement Specific Actions And Monitor The Progress.  Recalibrate Benchmarks.

14. Phase V : Maturity : Maturity phase would be reached when best industry practices are incorporated in all business processes. This maturity phase is reached through the following two steps ; Attain The Leadership Position. Integrate Practices Into The Process.

15. Benefits Of Benchmarking : Creating a culture that values continuous improvement to achieve excellence. Sharing the best practices between benchmarking partners. Prioritizing the areas that need improvement. Enhancing creativity by devaluating the not-invented-here syndrome. Increasing sensitivity to changes in the external environment. Focussing resources through performance target set with employee unit.

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