The paper "What Are the Analytical Foundations of the Management Technique Referred to as Benchmarking" is a great example of business coursework. Contemporary business and market environments are characterized by increased cut throat competition which is coupled by turbulent and shifting political, economical, technological, environmental, legal, financial, cultural and social forces which necessitate modern firms and institutions to increasingly adapt and be flexible to these changes in order to sustain their competitiveness and remain successful. Patterns towards globalization demand that organizations are not only effectively managed but also are highly adaptable and outward-oriented. The flexibility to changes and effective planning and implementation of change processes can be achieved through benchmarking as stated by Voss, Ahlstrom, & Blackmon (1997, p.
2). Alternatively, benchmarking is an essential component in the process of setting goals and designing performance objectives which help in attaining improved performance and productivity. Benchmarking refers to the process where organizations weigh their operational processes and their performance metrics against the industry’ s best. This definition is further expounded by Andersen (1999, p. 287) who defines benchmarking as a process entailing core elements of measurement, when a firm measures its own and benchmark partner’ s performance for comparison and registering improvements, comparison, of the level of performance, business practices and processes, learning, from what the best are doing and introducing similar or superior improvements and Improvement, which forms the aim of undertaking a benchmarking exercise (Andersen, 1999, p.
288). Among variables that are compared and contrasted includes time efficiency, costs and quality produced. During the process of benchmarking, the top management establishes the best performing organization within or even across industries where comparable processes are utilized and then the organization compares the performance, outcomes and processes their own performance, outcomes and processes (Larry, 2003, p.
8). This helps the organization in understanding what the best in the industry are doing different that makes them different thus, changing accordingly. Simply put, benchmarking entails establishing who is the very best, analysing who creates the standards and understanding what the standards are (Larry, 2003, p. 8). This report seeks to examine what are the analytical foundations of benchmarking are and evaluate whether these foundations place any limitations on its applicability. Why benchmark? Benchmarking process focuses not merely on results, products and services, but also on process issues.
This is echoed by Peppard (1999, p. 299) who indicates that processes are building blocks of organizations and help in capturing natural workflows. Prior to fully analysing analytical foundations of benchmarking, it is important to establish the reasons why an organization should benchmark. Among the main reasons why an organization should benchmark is because they are able to understand what the standards of performance and productivity are and hence, they are effectively able to measure up their performance and business processes, it is able to continuously learn, and it helps create a critical attitude towards one’ s own business processes and performance as discussed by Andersen (1999, p.
288). In addition, through benchmarking, an organization understands who the active and prospective competitors are, and they are able to acquire new insights as they compare their policies, standards, ideologies, performance measures and processes against the world’ s or industry’ s best. However, organizations need to be keen not to misinterpret the concept as noted by Monkhouse (1995, p. 41).
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