Benchmarking is a technique in which a company measures its performance against that of best in class companies, determines how those companies achieved their performance levels and uses the information to improve its own performance. Subjects that can be benchmarked include strategies, operations and processes.
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Benchmarking is the process of measuring products, services, and processes against those of organizations known to be leaders in one or more aspects of their operations. Benchmarking provides necessary insights to help you understand how your organization compares with similar organizations, even if they are in a different business or have a different group of customers.
Additionally, benchmarking can help you identify areas, systems, or processes for improvements—either incremental (continuous) improvements or dramatic (business process reengineering) improvements.
Benchmarking has been classified into two distinct categories:
Excerpted from Jack B. ReVelle’s Quality Essentials: A Reference Guide from A to Z, ASQ Quality Press, 2004, pages 8–9.