Harley Davidson - Delivering Superior Customer Value through Marketing - Essay Example

Benchmarking has been defined in several ways, some technically stringent and some quite liberally. According to Minnesota Management and Budget (2012), benchmarking is described as ‘simply the comparison of one organization’s practices and performance against those of others.’ In this definition, benchmarking is thought to search for standards and ‘best practices that may be applied in the measurement of performance, with the aim of improving on it. Dalkir (2005) defined benchmarking as ‘the search for industrywide best practices that lead to superior performance…a tactical planning tool’ (p. 272). On the other hand, Zairi (1996) described benchmarking as something more than just a technique or tool; it was defined as a ‘very powerful concept, a change agent’ (p. 2). The cornerstone of benchmarking is its impact on behavior modification, of enhancing discipline in focusing attention on the customer and how business processes may be improved for their benefit.

The common thread running through all the different meanings is that benchmarking (1) seeks out best practices that a company could adopt (2) in order to improve its goods and/or service to its customers (3) by studying similar other companies or units where these best practices are employed.There are two kinds of benchmarking – internal and external. Benchmarking internal involves comparing among units in the same organization and adopting best practices within the same organization. Benchmarking externally involves comparing among companies, and adopting those best practices found to contribute to their success.

Additionally, Dalkir (2005), citing Spendolini (1992) identified four types of benchmarking, namely: (1) Industry Group Measurements, wherein companies compare measurements of various aspects of their operation against corresponding data, usually published and provided to subscribers, pertaining to other players within their industry; (2) Best Practice Studies, which investigates and lists those practices that work to the advantage of the company; not providing metrics, they are not benchmarks per se, but they provide a useful base for benchmarking research in general;(3) Cooperative Benchmarking, involving the measurement of vital production functions, the inputs, outputs, and outcomes (such as in an internal audit) for the purpose of improving on them, with the assistance of the firm being studied; a variation of this is Collaborative Benchmarking, wherein two companies study each other to learn from each other’s best practices; and (4) Competitive Benchmarking, wherein a competitor is studied and measured without the benefit of its cooperation or collaboration, in order to improve the quality of its product or process; also called reverse engineering.

One version of this type of benchmarking involves the commissioning of a third party to study a group of competitors, and subsequently sharing the results of the study with all of the companies studied. This method ensures the participants of a measure of confidentiality, in that the third-party consultant is the only party privy to the identities of the firms whose data are reported.Studies have confirmed that the various techniques associated with benchmarking have significantly aided follower companies to improve their operations by emulating best practices pioneered by industry leaders.