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Introduction To Benchmarking

Benchmarking

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35 views33 pages

Introduction To Benchmarking

Benchmarking

Uploaded by

hadi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Introduction to Benchmarking

• Benchmarking Study Levels


• Benchmarking Models & Partners
• Organizational Planning
• Planning Phase

• Data Collection
• Analysis Phase

• Action Phase
• Benchmark Ethics & Legal Issues

• Benchmarking Workbook
What is Benchmarking?

• A tool for conducting constructive self


assessments
• An on-going effort
Benchmarking and Breakthrough
Improvements

Benchmarking
sparks Continuous Improvement

innovation
Improvement

and change Breakthrough Improvement

Continuous Improvement

Time
Level of Benchmarking Studies
Each higher level of study becomes more complex & requires
more resources to complete
Stake- Management
holders Research and Development Production

Full-Vertical
Complexity

Study

Process
Study

262.4

Outcome
SNL/NM 153.8
85.6

158.1
LANL 105.9
35.1
Worst
Mean
Best
111.2

Based Study
Pantex 78.5
19.1

42
Industry (IPA) 31
19

0 50 100 150 200 250 300

Time to Complete Study


Outcome-Based Study
This study only looks at relative performance, and does
not answer the “why's”.

Org. A
Looks only at end results
(the outcome)
Org. B Measure 1
Measure 2
Measure 3
Focuses on quantitative data Org. C
and metrics (how much)
Org. D

0 50 100 150 200 250 300


Process-based Study

Organization A's Process Organization Organization C's Process


B's Process

Focuses on processes employed to accomplish a similar activity


function or system
Full-Vertical Study
Examines cross-functional processes and organizational interrelationships

Benchmarks organizational issues affecting processes


from beginning to end

Stakeholder Management Research and Development Production


The Fundamental
Benchmarking Model

Benchmarking models may have slight differences...


BUT each should include the same basic phases of:

Planning
Data Collecting
Analyzing
Action
The Environmental Management
Model

Planning Data Analysis Action


Collection
1 Clarify Objective 10 Conduct Research 14 Analyze Quantity 18 Comm. Findings
2 Select Process 11 Dist. Surveys 15 Analyze Quality 19 Action Plan
Post
3 Choose Team 12 Partner Conf. 16 Determine Gaps 20 Brief Mgt. Study
Implement
4 Define Scope 13 Brief Mgt. 17 Brief Mgt.
5 Develop Flow Track
6 Refine Flow Re-calibrate
7 Establish Measures
8 I.D. Partners

9 Brief Mgt.
Determine the Critical Success
Factors

• Selecting CSFs’
• What are the factors most crucial to the organization’s success
mission, or objective?
• What are the major “cost drivers” in the organization?
• What are the performance pressures being felt in the
organization?
• Which functions have the greatest room for improvement?
• Which functions have the greatest impact on perceived value of
services of the organization?
Planning Phase

• The Planning phase is the most important phase


§ It requires the most time and attention
§ Poor planning may ruin the chances of your success
• The primary function of this phase is to:
§ Lay groundwork
§ Gather all the pieces for accurate analysis and informed
decisions
Planning Steps
Step 1: Clarify the Objective
Step 2: Select the Process
Step 3: Choose the Team
Step 4: Define the Scope
Step 5: Develop the Process Flow
Step 6: Refine the Flow Chart
Step 7: Establish Process Measures
Step 8: Identify Benchmarking Partners
Step 9: Brief Management
Choose the Team
• The Core Team should include the process owner,
the process manager, and a facilitator
knowledgeable in the Benchmarking process.
• A responsibility matrix can be used to define the
roles of the Benchmarking team members.
• Team Members can be chosen at the same time the
process selection “step” is being worked.
• Ensure that the Core Team has received all
necessary Benchmark Training in order to proceed
with a common understanding.
The Benchmarking Team

People that are or


will be affected
by the process

Management Core Team Partners


3-5 people
Team Responsibility Matrix

Benchmark Manager

Process Stakeholder
Process Owner
Exec. Champion

Project Sponsor
Responsibilities
Promotes Benchmarking activities X X
Communicates with stakeholders X
Communicates findings X X X X X
Initiates Benchmarking efforts X
Reviews progress of team X X X
Allocates resources X X
Makes decisions about the project X
Define the Scope

• The scope of the study should reflect the


objectives and resources of the organization.
• The primary consideration in defining scope
is to avoid studies that are either to broad or
too narrow.
• Process boundaries are defined by distinct
“start” and “stop”activities.
Develop the Flow Chart
• Flow charts define the sequence of discrete activities
in a process.
• Developing the flow chart can reveal inefficient,
redundant, and unnecessary process steps.

No
Yes
Establish Process Measures
n Process measures are used to compare the process
performance of different activities.
n The team should select process measures that reflect
the objectives of the Benchmarking study.
n Some examples of process measures are;
n Cost to complete the process

n Time to complete the process

n Quality of the completed process

n Number of rework cycles

n Number of review loops


Identify Benchmarking Partners
n Partners are perceived as having better performance
compared to your organization.
n Considerations for selecting partners include:
n whether the process is similar enough to allow
comparison
n whether the organization is likely to share information

n whether the information is recent and reliable

n Similar processes may be encountered in widely


different industries.
n Utilize partners from other areas within your
organization.
Brief Management

Present study
findings
Gather and give Benchmarking Study Findings
feedback
Set realistic goals
Report to Management
Provide
documentation for
decisions
Data Collection Phase

• The Data Collection phase was developed as


a separate phase due to the amount of time
needed to interact with other companies.
• This phase has four steps.
Data Collection Phase Steps
• Step 10: Conduct Background Research
• Step 11: Distribute Surveys
• Step 12: Conduct Partnership Conferences
• Step 13: Brief Management
Conduct Background Research
• The Team should collect all relevant data, within the scope
of the study, that can be obtained without directly contacting
partners.
• Gathering as much background information as possible
educates the team on the process being studied and enables
better communication between the partners.
• A literature review should be conducted to obtain the
following information:
• General background on the process

• New technology relating to the process

• Previous studies of the process


Analysis Steps
• Step 14: Analyze Quantitative Data
• Step 15: Analyze Qualitative Data
• Step 16: Determine the Process Performance
Gap
• Step 17: Brief Management
Determine the Performance Gap
• The performance gap is the measure difference in
performance between the current process and the
processes employed by the Benchmarking partners.
• This gap is determined by combining quantitative
and qualitative data in order to assess relevant
performance for the process measures.
• The team may also find areas in which their
organization performs better than their partners.
Action Plan Phase
• Information from the study is fully utilized to
develop an implementation plan
• It implements the findings into everyday
work processes.
• It assigns milestones to the implementation
process.
Action Steps

• Step 18: Communicate findings


• Step 19: Develop Action and
Implementation Plan
• Step 20: Brief Management
Communicate Findings
• Once the Team knows which process improvements
should be made, a report is prepared for
management describing those improvements and
reasons why.
• The report must convey the strength of the analysis
in order to gain approval for implementing the
proposed changes.
• The report should be completed as soon as possible
after the analysis phase in order to maintain the
momentum of the study.
Develop an Implementation Plan
• An Implementation Plan is necessary to enable the transition
from the current process to the modified process.
• A detailed plan is essential for successfully implementing
process change.
• The plan must consider the time and resources necessary .
• The plan must address the organizational culture.
• A contingency plan should be developed in the event that a
problem occurs during implementation.
Legal Issues When Benchmarking in
DOE
• Certain issues must be considered
• Proprietary information

• Contractual relationships

• Regulatory direction

• Technology

• Cost & Schedule drivers

• Unique aspects of operations need to be addressed when


Benchmarking
• Diversity of sites and organizations

• The high number of boundaries that are crossed


Ethical Code of Conduct
• Situations that the individual Benchmarker may encounter:
• Misuse of Employment/Business Partners

• Misuse of Public information

• Legal Issues
• Competition in Contracting Act (CICA)

• Intellectual Property Rights

• Patents and Copyrights

• Policies and Communication Channels


• Use appropriate policies and communication channels
between legal functions and the Benchmarking activities
Benchmarking Ethics and
Legal Issues
• Open relations must be maintained.
• Don’t jeopardize the efforts by betraying
inter-organizational trust.
• Use common sense; if something appears to
be out of bounds it probably is.
Benchmarking Study Deliverables
• Planning Activity
• Methodology and Study Plan

• Preliminary identification of Potential Study Partners

• Data Collection Activity

• Raw Data

• Analysis Activity
• Performance gap analysis

• Study report, normalize data

• Action
• Action Plan

• Implementation Plan

• Recommendations for re-calibration

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