The Importance of Benchmarking

Why is benchmarking important? Simply put, “If you do not know where you have been, how will you know how far you have come”? Another way to think about it is to ask yourself, “Well, I think we are doing well, but how do I really know”?

There are four basic ways of benchmarking. Think about which one may apply to you, your department, and/or your company:

1. Internal Benchmarking
   Compares one department’s procedures to another
2. Competitive Benchmarking
   Compares organization’s procedures to those of a direct competitor
3. Functional Benchmarking
   Compares how dissimilar businesses perform similar functions
4. Generic Benchmarking
   Searches for the “Best of the Best”
   
   Benchmarking will help you know how far you have come, and how you stack up against the competition.