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Global Benchmarking as Modern Economics Principle

The variety of the modern world requires improved approaches to the economical sphere. The scope of information does not allow finding the appropriate one without any analysis and evaluation of received data. Modern world in the world of competition and the work under improvement of any company facilities becomes the core aim in the business world. The use of such comparative quantitative techniques as standards, indicators, and benchmarking become crucial for the business environment. The main aim of benchmarking may be characterized as the way of exploring best practices and their implementation in the company.

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Considering the benchmarking from the point of view of its main concepts and strategies, it should be discussed the very notion of benchmarking, its aim and nature. Benchmarking is the strategy which provides the planning methodology aimed “to uncover unique opportunities to gain business advantage over competitors” (Watson, 2007, p. 183). In other words, the business environment is analyzed, focusing on the same problems within the other companies and the successful strategy is chosen for the problem decision in the company with downsizing, outsourcing, communication and prioritizing solutions.

Considering the past problems of the present developed countries, like Toyota, it is possible to analyze the effectiveness of the chosen practice. The in time replacing of the bought products was considered as one of the most effective strategies, which was used by Toyota, and the results may be seen now, and the problem of that Toyota Company was not in the automobile business but in used practices. The same practice was used by Xerox Company, which spent too much time and costs on warehouses and the transportation. The elimination of warehouses in general and supplying of only necessary products allowed reducing costs on transportation and improving the effectiveness of work (Maul).

The shown examples are significant in the meaning that the benchmarking principles work, but the success of this work depends on the level of generic benchmarking provided. The benchmarking just gives the idea of how the company affairs may be improved and by means of which strategy, and the success of the strategy depends on the ability to assimilate the offered strategy to the current situation. Benchmarking is not just the copying of the most important issues and applying them in the current company, but the deep analysis of the measures provided, their application to the current sphere and the evaluation of the results.

Completing the phase of results evaluation, it may be concluded that benchmarking had a success and that the method fitted to the situation. There are four main types of benchmarking, which are useful to know before applying this strategy in the company: (1) external competitive benchmarking, which involves the comparison with the competitor, (2) external non-competitive benchmarking – the comparison with the companies which are not in the direct competence, (3) internal benchmarking, where the ideal company is taken from the other sphere, and (4) leader benchmarking, where the model is not the strategy or decision, but the work of the manager of the company (Kelly, 2001).

In conclusion, benchmarking is one of the ways to cope with the problems. The experience of other companies, which managed to overcome the problems and continue their development, is taken by the other company to cope with their ones. The benchmarking is usually preceded by a great deal of work, which includes analysis of the companies’ problems, evaluation of their strategies and applying of these strategies to the existing company.

Reference

Kelly, A. (2001). Benchmarking for school improvement: a practical guide for comparing and improving effectiveness. Routledge, Oxford.

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Maul, J. Generic Benchmarking: For Solving Problems… and for Life. EdD.

Watson, G. H. (2007). Strategic benchmarking reloaded with six sigma: improve your company’s performance using global best practice. John Wiley and Sons, New York.

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StudyCorgi. (2021) 'Global Benchmarking as Modern Economics Principle'. 1 November.

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