Analysis of the benchmarking process as a potential tool to enhance organizational competitiveness

This praxis describes the benchmarking process and proposes ways it could improve the overall competitiveness of an organization. It defines benchmarking in various ways; delineates the four types of benchmarking; gives the advantages and inhibitors of benchmarking; explains the legal and ethical considerations for the benchmarking organization; points out expert resources; and explains management's role in the benchmarking process. The praxis details the four phases and eleven steps of the Lockheed Fort Worth Company (LFWC) benchmarking process. In Phase I, planning, an organization chooses what process to benchmark, forms a benchmarking team, and identifies comparative organizations. In Phase II, analysis, an organization determines the data collection methods and then collects the data, determines the performance gaps, and projects future performance levels. In Phase III, integration, an organization communicates its benchmarking findings to the organization and establishes functional goals. In Phase IV, action, an organization develops an action plan to attain their goals, implements the action plan, and recalibrates the benchmarking project. A pilot project at LFWC is described to show how a benchmarking process model improved the technical documentation submittal process. After passing through the four phases, LFWC determined the associated costs and savings from the pilot project to identify the economic and non-economic benefits. Lessons learned identify practices to repeat and practices to avoid.;Although benchmarking represented the improvement method management requested, future teams will be called upon to choose between benchmarking and a multitude of other improvement techniques. To assist in this effort, benchmarking and its use on the Lockheed pilot project is compared and contrasted against six other process improvement models: dynamic simulation, value engineering, customer satisfaction surveys, competitor profiling, business process improvement, and reengineering. The result is not only a table to assist in selecting the correct improvement method but also the identification of tools to enhance the benchmarking process.;During the analysis of the benchmarking methodology, two apparent weaknesses surfaced--the benchmarking partner selection and the gap analysis. Application of a linear mathematical model, called data envelopment analysis (DEA), to the Lockheed pilot project identified the best partners and provided a more accurate gap analysis. The analysis of DEA is used to determine its usefulness as an integral part of and enhancement to the formal benchmarking process.;This praxis focuses on three primary contributions made to LFWC and the field of benchmarking. The first contribution involves the compiling of information gleaned from the application of benchmarking to a pilot project. The result is a reference guide for future LFWC benchmarkers that includes process details and project management data. The second contribution is an evaluation of benchmarking compared and contrasted to other methods of improvement. From this focus area of the praxis, an improvement method relationship diagram and an improvement method selection guide is developed to help users understand how the seven different methods interact and to assist the users in selecting the appropriate improvement method(s). The third contribution involves evaluating the application of data envelopment analysis (DEA) to a formal benchmarking process as an enhancement. The resulting evidence suggests that DEA can take advantage of the discovered weaknesses in benchmarking and enhance and strengthen a benchmarking process in multiple areas.