Benchmarking: what it is and 5 ways to apply it to your business

Benchmarking: what it is and 5 ways to apply it to your business

by Team AllYourVideogames | Aug 26, 2022 | Entrepreneurship |

Do you want to know what is benchmarking? Do you know your types and know how to apply this management tool in your business?

Today we are going to explain what this concept is and how it can help you improve your processes and make your company competitive with your competitors.

Benchmarking: what is it?

Benchmarking comes from the word benchmark, which is freely translated: reference. In the business world, it is a technique that seeks inspiration from other companies to improve the way your company works.

In addition to improving processes, the objective of benchmarking is to generate profit for a company. It can be said that those who practice the benchmark are keeping up to date in their market.

As inspiration we look for who is a reference or in something that is working, benchmarking is a tool that consists of analyzing market practices, especially competitors.

Benchmarking: how to do it?

The benchmark is not exclusive to the corporate world. In the world of sports, for example, it is common to see the famous “scouts” who study the formation of a team.

In addition to not being exclusive to the corporate world, it is also not exclusive to large organizations. So, if you have a small diner in your neighborhood, you have no excuse to practice benchmarking.

To get the information, you can participate in events related to your market, for example.

To do this, just analyze what other companies, which operate in the same field of activity as your business, are practicing. You can even mirror yourself in large companies and adapt their best practices to your reality.

In addition, you can do an analysis of data on websites and social networks of your benchmarks. Or, use your network of contacts and schedule a visit, honor your competitor's service and delivery.

Now that you know what benchmarking is, we need to list the types and differences of benchmarking. Each one seeks to achieve a different area of ​​the organization or a different result.

So, before doing benchmarking, it is important to know what are the best ways to practice.

See more: 4 customer relationship strategies to improve your company

Benchmarking: tipos

Competitive benchmarking

In competitive benchmarking, your point of reference will be your competitor. The intention is to compare your closest competitors with your business, whether products or services.

When we talk about close competitors, we are referring to those who compete with you for customers. Therefore, your company must keep an eye on the best market practices exercised by them.

It can be done, for example, by comparing offers, arrangement of products, quality or type of service provided. A hint! Visit the social networks of your nearby competitors. You will get a lot of information there.

Benchmarking funcional

In functional benchmarking, the focus is on finding points for improvement in your business and not on customer disputes.

Therefore, your reference point can be any organization with similar processes, even if it works with different products.

Examples: people management, financial management, accounting practices. These activities are inherent to almost all organizations and you may find it difficult to manage any of these processes.

If this happens, you can ask other entrepreneurs what practices have worked in their businesses. After coming up with ideas, just analyze which one best fits your reality.

generic benchmarking

Generic benchmarking is applicable when a local market is not disputed, but organizations share similar operating processes. For example, some organization from another city or country that works in your field of activity.

Internal benchmarking

Internal benchmarking is mostly applied by large organizations, with several departments and with diverse work teams. Because, as the name implies, it will be applied internally in the company itself.

In it, an area analyzes what another area does to achieve its results and what can be used and improved from it. With internal benchmarking it is possible, for example, to understand which department of the organization is losing results.

Therefore, it is important that the efforts of a department are shared with others. Internal benchmarking increases the synergy of organizations.

Cooperation benchmarking

Cooperation benchmarking requires a partnership with other companies. This partnership typically happens when an organization is very good at one process and bad at another.

Thus, a company that sells well, but delays its deliveries, can partner with a company that dominates the delivery process.

In return, she will help develop the partner company's sales process. The continuous improvement process is mutual for both companies.

These are benchmarking examples that you can use to learn what you can improve in your organization with other companies.

Benchmarking no Marketing Digital

You can increase the efficiency of your business by analyzing what other companies do on the internet to attract potential customers. Following reference people on the subject is already a way to start your digital benchmarking.

In addition, you can analyze what kind of ads your competitors are creating on social media. What marketing emails have you been receiving and how are your sales copy structured.

Take a little time and analyze which platform you find the highest incidence of ads from your competitors. That's probably where your persona spends most of their time.

Some tools like Similar Web can optimize this analysis. Other competitor website analysis tools also do this job, some of which you can even access for free.

In addition, Facebook's own business generator shows you important data about your ads. In it you evaluate ads from both Facebook and Instagram.

On Facebook, you can select some fanpages similar to yours for analysis and comparison. With this feature, you can see the performance of these pages in relation to the results achieved by your business and apply optimizations.

Did you see how much you can do for your company, even if it's without leaving it?

Now that you have learned what benchmarking is and how it can innovate your company, we want to know: can you visualize any area or process that can apply benchmarking in your business? Tell us here in the comments.