Benchmarking Glossary

Effective benchmarking requires a common language. This glossary is based on the one published by The Benchmarking Exchange

This glossary defines the following benchmarking classes:

A measured 'best in class' achievement. The performance level which is recognised as the standard of excellence for a specific business process.
A systematic and continuous measurement process; a process of continuously comparing and measuring an organization's business processes against business leaders anywhere in the world to gain information which will help the organization take action to improve its performance.
Benchmarking gap
The difference in performance between the benchmark for a particular activity and other companies in the comparison; the measured leadership advantage of the benchmark organization over other organizations.
Best Practice
Superior performance within a function independent of industry, leadership, management, or operational methods or approaches that lead to exceptional performance; best practice is a relative term and usually indicates innovative or interesting business practices which have been identified as contributing to improved performance at leading companies.
Business Process
A series of interrelated activities which convert inputs into results (outputs). Processes consume resources and have a limited capacity and capability. Benchmarking requires a standard set of process classifications which are understood by both parties in a benchmarking project. The Best Practice Club has defined these in a Business Process Classification Scheme.
Capability mapping
The analysis of the business infrastructure of an organization to determine unique abilities and potential.
Competitive Benchmarking
A measure of organizational performance compared against competing organizations.
Core Competencies
Describe strategic business capabilities that provide a company with a marketplace advantage.
Critical Success Factors (CSF)
Quantitative measures for effectiveness, economy, and efficiency; those few areas where satisfactory performance is essential in order for a business to succeed; characteristics, conditions, or variables that have a direct influence on a customer's satisfaction with a specific business process; the set of things that must be done right if a vision is to be achieved.
Customer Advocate
The role played by a member of some teams where that individual pleads the case of the customer and calls the attention of the team to issues which would concern the customer.
Customer Analysis
The evaluation of customer's conditions and trends relative to a particular product or service of a business - tools include customer focus groups, field trial testing, customer satisfaction measurement, customer feedback systems, and the use of various types of questionnaires and survey instruments.
Those processes, practices, or methods that facilitate the implementation of a best practice and help to meet a critical success factor; enablers help to explain the reasons behind the performance indicated by a benchmark.
The best that can be achieved in process performance using current resources to eliminate waste and improve cycle time; obvious improvements identified during the process of benchmarking and which may be accomplished as short- term goals.
Functional Benchmarking
Process benchmarking which compares a particular business function at two or more companies.
Generic Benchmarking
Process benchmarking which compares a particular business function or process at two or more companies independent of their industry.
Global Benchmarking
The extension of strategic benchmarking to a global scale.
Internal Benchmarking
Process benchmarking which is performed within an organization by comparing similar business units or business processes.
Key Business Process
Those processes that influence the customer's perception of your business.
A description, representation, or analogy which is used to help visualize something that cannot be directly understood
A decentralized organization of independent participants who develop a degree of interdependence and share a coherent set of values and interests.
Performance Benchmarking
Measurement of the performance of one company's product against those of another company.
Process Benchmarking
The measurement of discrete process performance and functionality against organizations that are excellent in those processes.
The radical redesign of business processes, organizational structures, management systems, and values of an organization to achieve breakthroughs in business performance.
Strategic Benchmarking
A systematic business process for evaluating alternatives, implementing strategies, and improving performance by understanding and adapting successful strategies from external partners who participate in an ongoing strategic alliance.
World Class
Leading performance in a process independent of industry, function, or location.