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What is benchmarking and what types are there?

In a market as fast-paced as the one we are currently in, your competitors are working to gain an edge and time is of the essence. If you want to advance your organization in every possible way, then conducting a benchmarking study is just what you need.

A benchmarking assessment can be a great alternative if you're looking for ways to speed up your company's performance. Assessments are really useful for improving your processes and comparing them with those organizations that are currently achieving great results.

In this article, we'll explain everything you need to know about benchmarking: its benefits, advantages and disadvantages, and its process. We also provide some examples to help you visualize its stages and operation.

What is benchmarking?

Benchmarking is a business management method that seeks to find the best practices within or outside the company by comparing techniques, processes, and services of other organizations in order to increase their efficiency and competitiveness.

The main idea is to take the most notable practices from other companies and adapt them to your work environment to improve your services. Therefore, it is not necessary for the comparisons to be necessarily with companies in your same industry, as in other sectors you can find the ideal solutions that make your performance and productivity efficient.

Benchmarking can be applied to any process, approach, function, or product in companies, as its process focuses on measures of quality, time, cost, effectiveness, and customer satisfaction.

Characteristics of benchmarking

It has objective purposes.

It analyzes trends.

It is oriented towards best practices.

It has objective purposes.

The benchmarking's main characteristic is its objectivity and is built according to objective rules; that is, there must be a specific reason why organizations are included.

It analyzes trends.

It constantly analyzes trends according to market benchmarks that serve as a guide for continuous process improvement.

It is oriented towards best practices.

Benchmarking, as part of a continuous improvement program that incorporates feedback processes, is characterized by orienting its objectives towards improving practices to identify improvement opportunities.

What is benchmarking used for?

To conduct a comparative evaluation.

To improve the productivity of your company.

To reduce business risk.

To conduct a comparative evaluation

Benchmarking is used to make a comparative evaluation that helps you detect examples of best practices. It is often confused with competitor analysis; however, it is something deeper. And while it is not about copying everything your competitors have or do, benchmarking allows you to implement all the good things they have to improve your own performance.

To improve the productivity of your company

Benchmarking is also used to positively boost the improvement of your work processes and increase the productivity of your company. It helps you identify strengths and weaknesses to find opportunities that allow you to adjust and optimize your procedures.

To reduce business risk

Investing in benchmarking is relevant, as it can respond to incidents within your organization, especially when it comes to reducing business risk, creating efficiency, and protecting your brand.

Objectives of benchmarking

Benchmarking involves constant learning and improvement of your company. This involves acquiring knowledge of the best business practices in your sector to implement them in your organization. This will be achieved through the teamwork that exists between the different areas in your company and the comparison with your direct and indirect competitors.

The objectives of benchmarking are quite specific:

To make your company's production processes efficient through the improvement of current processes. This will make each component more profitable.

To increase the quality of your company both internally and externally. This means that both members of the company and customers must perceive these changes.

To help you become a reference within your market, applying the best practices of your industry and becoming a cutting-edge organization in the sector to which you belong.

Industries and sectors are constantly changing, and to maintain your company as a market leader, you need to have defined objectives. Benchmarking