There are many definitions to describe benchmarking. To start off, the thesis sets great store by Robert Camp’s idea from his first notable benchmarking book in 1989. It is hard to disagree with Stapenhurst (2009:p10) who regards the book as “a definitive book on benchmarking”. In his book, Camp (1989) marks his definition as a working definition, which he derived from his working experience and from other sources. Camp (1989:p12) therefore provides his definition as “Benchmarking is the search for industry best practices that lead to superior performance”. Camp (1989) also agreed that benchmarking should be defined in accordance with its activity, which consist of several functions and activities like: (1) continuous process; (2) measurement; (3) products, services and practices; and (4) prominent companies within the industries. To him, a definition of benchmarking should portray these actions in order to demonstrate the concept of benchmarking itself. However, in the same book, Camp also gives a generic definition of benchmarking which he described as “A basis of establishing rational performance goals
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through the search for industry best practices that will lead to superior performance” (Camp, 1989:p250).
Also, from another perspective, McGeorge and Palmer (2002:p82-83) have a separate way of presenting the definition. They carefully addressed the meaning of benchmarking through separate key subject matter, namely: “(1) it is structured; (2) it is ongoing; (3) the comparison is with best practice; and (4) its aim is organisational improvement through the establishment of achievable goals”. They meticulously described each subject and explained that being structured is to establish a systematic approach starting from planning, delivery and monitoring. The idea of ‘ongoing’ was described as making a continuous effort in order to be the best, since technology, methods and products tend to develop and progress constantly. The third key element of their definition suggests that merely comparing to others does not inevitably result in improvement. The essential factor is to find best practice for comparative measure. It is believed that choosing among best practices may lead to superiority. Lastly, they recommend that the final important aspect in benchmarking is to learn from the best practice and compare with the organisation’s own goals. Hence, in doing so, the organisation can strategise its targets based on the lesson learnt.
Meanwhile, Stapenhurst (2009:p6) depicts his definition into a unique form of description which demarcates each point into a separate line of explanation, each of which brings a separate meaning. He therefore defines benchmarking as:
“A method of Measuring and Improving Our organisation
By comparing ourselves with the best”.
In relation to the above definition, Stapenhurst (2009) spreads his definition into a sequence of action which delineates the task of benchmarking. The first line demonstrates the function of benchmarking as a method; the following line justifies the role of the approach as a measuring tool; the third line proposes the aim of action which is to improve the current situation; the fourth line then informs the application of benchmarking is meant for the benefit of one’s own organisation; and lastly the definition suggests that benchmarking is to compare with best practice.
Nevertheless, of all the definitions provided in 1989, 2002 and 2009, the researcher was drawn to a definition given by Spendolini (1992) which was then selected as a direction for this thesis. It was almost a complete description, bringing together all the key aspects of benchmarking provided by other writers.
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“A continuous (1), systematic (2) process (3) for evaluating (4) the products (5), services (5), and work processes (5) of organisations (6) that are recognised (7) as representing best practices (8) for the purpose of organisational improvement (9)” (Spendolini, 1992:p9).
In relation to Spendolini’s (1992) definition above, it was understood that he had tested and narrowed down a total of 49 benchmarking definitions which he had discovered, and had finally resolved with an inclusive meaning of the benchmarking concept. Spendolini (1992) then arranged the definition into parentheses of his key idea (see Figure 3.1). The definition thus has a distinct feature of distinguishing some words into a specific context. These phrases were carefully addressed to denote certain actions. From Figure 3.1, it is obvious that the structure allows flexibility in justifying the subject for benchmarking. It accepts the use of more than one item for any boxes to accommodate the requirement and purpose of the benchmarking case. The blank space in some of the boxes informs the availability to add any word in relation to the evaluator, in order to fit into the benchmarking procedure.
A for the
of that are as for the purpose of
Figure 3.1: The benchmarking menu. Source: Obtained from Spendolini (1992:p10)
At this point, it is also useful to consider the meaning of the phrase Best Practice and other related words in conjunction with the benchmarking activities. Given that ‘best practice’ is repeatedly being used and
Continuous Ongoing Long-term _________ Systematic Structured Formal Analytical Organised _________ Process Evaluating Understanding Assessing Measuring Comparing _________ Business practices Products Services Work processes Operations Functions _________ Organisations Companies Institutions _________ Recognised Acknowledged Identified _________ Best-in-class World-class Representing best practices _________ Organisational comparison Organisational improvement
Meeting or surpassing industry best practices
Developing product / process objectives
Establishing priorities, targets, goals
1 2 3 4 5
6 7 8
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frequently being associated with benchmarking, as well as other words like the Critical Success Factor (CSF) and World Class which will appear either later in this chapter or in subsequent chapters, therefore, it may be handy and effective to grasp the meaning of those words.
(a) Best Practice
Best practice generally represents an exemplar of certain practice or process or approach. When an organisation or company achieves best practice, this means that the organisation or company demonstrates the highest level of achievement as compared to others. This can be portrayed by its performance and experience, including the awards or profits it had gained, or recognition or position it had placed itself. According to Town (2000), best practice is achieving excellence in certain action or practice. Benchmarking aims to seek out the methods of practices by which this performance is achieved”. In another account, the American Productivity and Quality Center (1993:p10) mentioned that, “Best practices are leadership, management, or operational methods or approaches that lead to exceptional performance. Best practice is a relative term, not an absolute standard”.
(b) Critical Success Factors (CSF)
Critical Success Factors are a number of factors considered by an organisation or company as a measurement in achieving certain targets. Critical Success Factors are referred to for the purpose of achieving certain performance, for example customers’ satisfaction, efficiency in production or the effectiveness in a delivery process. Town (2000:p3) described CSF as “the small number of things that an organisation must have, or need to do, to fulfil its vision or mission and be successful. Usually expressed as a set of simple statements which define the most important things to achieve”. Meanwhile, Andersen and Pettersen (1996:p24) describe it as “A limited number of factors that highly impact upon the company’s competitiveness”. For example, “price, quality, delivery time, product attributes, service”.
(c) World Class
There is no absolute criterion to describe a company, or an institution as a ‘world class company’ or ‘world class institution’. Generally, ‘world class’ is acknowledged from the perception or recognition it received from the general public, due to its leading image or achievement. As Maylor (1996:p235) describes it, “The definition of world-class performance is open to debate and that this is not always totally objective”. Additionally, he too added that, “A world-class company is one that is considered to be world-class in a number of measures” (Maylor, 1996:p235). In relation to this, a world class organisation is likely to have certain characteristics or encompasses of certain aspects accepted internationally or meets the world standard. For example, an equestrian facility that trains and accommodates local riders and only equipped with facilities of a local context cannot be identified as a world class. Similarly, an equestrian facility which only facilitates at regional scale and has no
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experience at international scale cannot be labelled as world class too. In contrast, equestrian facilities and resources of international standard, delivering services of international scale and capable of accommodating international events, plus being acknowledged worldwide can be identified as a world class.