Read Why do business professionals choose ready-to-use KPIs? to find out the answers to these questions:
Comparing own performance with one who does better than you can have two results- 'turning green with jealousy' or 'using it for self-improvement'. The latter concept when followed by companies gives rise to what is termed 'benchmarking'.
This procedure of structuring benchmarks however, demands adopting a highly detailed structure in which the practices being followed in the concerned organization are seen in the light of the ones being followed in industry leaders. Further, improvements are carried out to match those practices as closely as possible are conducted.
At times, cross-industry comparisons are also done as similar steps can be followed at other places. Due to the very wide spread of this thought, it often turns out to be a really lengthy process. However, one cannot compromise on the steps of the process. So, the analysis has to be carried out giving it the due importance and time for reaping the desired benefits.
This act of 'performance comparison' makes it possible for organizations to have 'best of all the worlds' thereby moving ahead of the oft followed 'best of both the worlds' idea. On an ending note, the job of 'performance benchmarking' does not end at the introduction of this strategy in the organization but has to be continued for which a benchmarking scorecard comes to help. By using this strategy, one can smoothly go for improvement benchmarking in the organization.
This is the actual scorecard with Benchmarking Performance Indicators and performance indicators. The performance indicators include: benchmarking, market analysis, market share, market demand growth, risk profile, value-at-risk, expected exposure, unexpected loss, project cost, avg. monthly labor cost, downtime cost, cost of defect, investment, return on investment, investment efficiency, investment growth, performance, productivity, time to market, defect detection.