Benchmarking

Benchmarking is the process of comparing one's business processes and performance metrics to industry bests or best practices from other industries. Dimensions typically measured are quality, time and cost. In the process of benchmarking, management identifies the best firms in their industry, or in another industry where similar processes exist, and compare the results and processes of those studied (the "targets") to one's own results and processes. In this way, they learn how well the targets perform and, more importantly, the business processes that explain why these firms are successful. Benchmarking is used to measure performance using a specific indicator (cost per unit of measure, productivity per unit of measure, cycle time of x per unit of measure or defects per unit of measure) resulting in a metric of performance that is then compared to others Also referred to as "best practice benchmarking" or "process benchmarking", this process is used in management and particularly strategic management, in which organizations evaluate various aspects of their processes in relation to best practice companies' processes, usually within a peer group defined for the purposes of comparison. This then allows organizations to develop plans on how to make improvements or adapt specific best practices, usually with the aim of increasing some aspect of performance. Benchmarking may be a one-off event, but is often treated as a continuous process in which organizations continually seek to improve their practices.

Procedure
Robert Camp developed a 12-stage approach to benchmarking as follows: 1. Select subject 2. Define the process 3. Identify potential partners 4. Identify data sources 5. Collect data and select partners 6. Determine the gap 7. Establish process differences 8. Target future performance 9. Communicate 10. Adjust goal 11. Implement 12. Review and recalibrate

Types

Process benchmarking - the initiating firm focuses its observation and investigation of business processes with a goal of identifying and observing the best practices from one or more benchmark firms. Activity analysis will be required where the objective is to benchmark cost and efficiency; increasingly applied to back-office processes where outsourcing may be a consideration. Financial benchmarking - performing a financial analysis and comparing the results in an effort to assess your overall competitiveness and productivity. Benchmarking from an investor perspective- extending the benchmarking universe to also compare to peer companies that can be considered alternative investment opportunities from the perspective of an investor. Performance benchmarking - allows the initiator firm to assess their competitive position by comparing products and services with those of target firms. Product benchmarking - the process of designing new products or upgrades to current ones. This process can sometimes involve reverse engineering which is taking apart competitors products to find strengths and weaknesses. Strategic benchmarking - involves observing how others compete. This type is usually not industry specific, meaning it is best to look at other industries. Functional benchmarking - a company will focus its benchmarking on a single function to improve the operation of that particular function. Complex functions such as Human Resources, Finance and Accounting and Information and Communication Technology are unlikely to be directly comparable in cost and efficiency terms and may need to be disaggregated into processes to make valid comparison.

Empowerment
The term empowerment covers a vast landscape of meanings, interpretations, definitions and disciplines ranging from psychology and philosophy to the highly commercialized self-help industry and motivational sciences. Sociological empowerment often addresses members of groups that social discrimination processes have excluded from decision-making processes through - for example - discrimination based on disability, race, ethnicity, religion, or gender. Empowerment as a methodology is often associated with feminism: see consciousness-raising.

Process
The process which enables individuals/groups to fully access personal/collective power, authority and influence, and to employ that strength when engaging with other people, institutions or society. In other words, Empowerment is not giving people power, people

already have plenty of power, in the wealth of their knowledge and motivation, to do their jobs magnificently. We define empowerment as letting this power out (Blanchard, K)." It encourages people to gain the skills and knowledge that will allow them to overcome obstacles in life or work environment and ultimately, help them develop within themselves or in the society.

Re-Engineering
The application of technology and management science to the modification of existing systems, organizations, processes, and products in order to make them more effective, efficient, and responsive. Responsiveness is a critical need for organizations in industry and elsewhere. It involves providing products and services of demonstrable value to customers, and thereby to those individuals who have a stake in the success of the organization. Reengineering can be carried out at the level of the organization, at the level of organizational processes, or at the level of the products and services that support an organization's activities. The entity to be reengineered can be systems management, process, product, or some combination. In each case, reengineering involves a basic three-phase systems-engineering life cycle comprising definition, development, and deployment of the entity to be reengineered.

Systems-management reengineering
At the level of systems management, reengineering is directed at potential change in all business or organizational processes, including the systems acquisition process life cycle itself. Systemsmanagement reengineering may be defined as the examination, study, capture, and modification of the internal mechanisms or functionality of existing system-management processes and practices in an organization in order to reconstitute them in a new form and with new features, often to take advantage of newly emerged organizational competitiveness requirements, but without changing the inherent purpose of the organization itself.

Process reengineering
Reengineering can also be considered at the levels of an organizational process. Process reengineering is the examination, study, capture, and modification of the internal mechanisms or functionality of an existing process or systems-engineering life cycle, in order to reconstitute it in a new form and with new functional and nonfunctional features, often to take advantage of newly emerged or desired organizational or technological capabilities, but without changing the inherent purpose of the process that is being reengineered.

Product reengineering
The term reengineering could mean some sort of reworking or retrofit of an already engineered product, and could be interpreted as maintenance or refurbishment. Reengineering could also be

interpreted as reverse engineering, in which the characteristics of an already engineered product are identified, such that the product can perhaps be modified or reused. Inherent in these notions are two major facets of reengineering: it improves the product or system delivered to the user for enhanced reliability or maintainability, or to meet a newly evolving need of the system users; and it increases understanding of the system or product itself. This interpretation of reengineering is almost totally product-focused.