Benchmarking is the process of measuring an organization's internal processes then identifying, understanding, and adapting outstanding practices from other organizations considered to be best-in-class.
The term benchmarking was first used by cobblers to measure people's feet for shoes. They would place someone's foot on a "bench" and mark it out to make the pattern for the shoes. Benchmarking is most 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.
Most business processes are common throughout industries. For examples: NASA has the same basic Human resources requirements for hiring and developing employees as does American Express. British telecom has the same Customer Satisfaction Survey process as Brooklyn Union Gas. these processes, albeit from different industries, are all common and can be benchmarked very effectively. It's called "Getting Out Of The Box".
In other words, Benchmarking is the process of comparing one's business processes and performance metrics to industry bests and/or best practices from other industries. Dimensions typically measured are quality, time, and cost. Improvements from learning mean doing things better, faster, and cheaper.
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