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Modules -

Benchmarking
Session Plan / Session Materials

Quality Management & Training Limited Slide -1-


26/05/99 - Geoff Vorley
Objectives
! To introduce the concept of benchmarking
! Establish and quantify factors to monitor quality
performance. (Identification of the gaps between output &
and customer satisfaction)
! Establish factors to judge quality performance
! Current performance
! identification of trends
! never-ending improvements.
! established at all levels

Quality Management & Training Limited Slide -2-


26/05/99 - Geoff Vorley
Purpose of Benchmarking
! If you know your enemy and know yourself, you
need not fear the result of a hundred battles
! Benchmarking provides a means for establishing
what customer needs are to be met to ensure
customer satisfaction
! Competitive Benchmarking involves comparing
processes or products with a competitor
! Benchmarking on the job
! Personal Benchmarking
Quality Management & Training Limited Slide -3-
26/05/99 - Geoff Vorley
Internal Customers

Internal Customers
Your Manager/Secretary
Department Relationship
Provide an example
within your own
Supplier Customer organisation
Departments Departments

Quality Management & Training Limited Slide -4-


26/05/99 - Geoff Vorley
Benchmarking on the Job
! What do you supply your customer?
! What is the best that can be done?
! How do you know how well you do?
! How could you improve?

Quality Management & Training Limited Slide -5-


26/05/99 - Geoff Vorley
Bench Marking Sequence
! Agree the need
Management
Commitment ! Communicate
Select Process ! Commitmt & understandg
Monitor
& Owner Departml Purpose Anal.
!

! Select Processes
Determine ! Critical success factors
Agree Action Quality Suitable
Performance Consistent
Clear and rest - particular
group
Determine
Collect the Easily & regularly calculated
Bench Mark
Data (3 and 7 performance
Source
Analyse the measures.)
Data

Quality Management & Training Limited Slide -6-


26/05/99 - Geoff Vorley
Quality Performance - Hard & Soft Standards
! Hard Standard - Quantifiable
Management
Commitment ! Soft Standard - Non-quantifiable, Subjective
Select Process
Monitor
& Owner
! Customer Satisfaction
Determine
! Process Efficiency
Agree Action Quality ! Environmental Losses
Performance

Determine
Collect the
! Typical Hard Standards; Cost, Quality, Service
Bench Mark & Time
Data
Source
Analyse the
Data
! Typical Soft Standards; Personnel Style,
Efficient Service, Concern
! Provide three work based examples of both
Hard & Soft Standards

Quality Management & Training Limited Slide -7-


26/05/99 - Geoff Vorley
Standards Exercise

With a colleague establish for a key process within your


organisation the following:

Two quantifiable Hard Standards


. Two Soft Standards
. The measurement method, responsibility and
frequency
. The bench mark source
. The monitoring method

Quality Management & Training Limited Slide -8-


26/05/99 - Geoff Vorley
Data Collection & Analysis
! Data Collection; How to quantify the
current performance level
Management
Commitment
! Customer satisfaction which could be
Select Process quantified by surveys of both existing and
Monitor
& Owner potential customers
! Process efficiency; by monitoring scrap,
Determine
Agree Action Quality
rejects and rework levels.
Performance
! Environmental losses; waste of resources,
human and energy,
Determine
Collect the
Bench Mark
Source
Data ! Analysis;
Analyse the
Data ! TQM team or departmental personnel
! Action Plan for Improvement

Quality Management & Training Limited Slide -9-


26/05/99 - Geoff Vorley
Exercise
Task: It is proposed to evaluate up to 10 manufactures (demand chain).
This involves:-
the design of a benchmarking questionnaire which should address:
- Seek information about the business and the context in which it works
- Explore how the business works with its suppliers

Time: Preparatioin time 45 minutes


Feedback time 15 mins

Outcome: A questionaire which will collect data on the most common features in the
manufacturing areas

Quality Management & Training Limited Slide -10-


26/05/99 - Geoff Vorley
Bench Mark Sources
! Identify the competitive gaps
Management
Commitment ! Where could you obtain Bench
Select Process
Monitor
& Owner mark Sources?
! Internal Bench Marking
Determine
Agree Action Quality
! Industrial Bench Marking against the
Performance competition.
! Trade Associations
Determine
Collect the
Bench Mark
Data
! Recruiting staff from the competition
Source
Analyse the
Data
! Best practice clubs

Quality Management & Training Limited Slide -11-


26/05/99 - Geoff Vorley
Exercise
! Determine benchmarking standards for the
following problem areas:
! Waste or errors
! Staff turnover
! Lead time
! Late delivery times
! What sources can be used to obtain the information?
! What methods will be used to collect the data
! How will the data be analysed?

Quality Management & Training Limited Slide -12-


26/05/99 - Geoff Vorley
Benchmarking = Survival
Company A World Class

! Supplier Lead time 150 days 8 days


! Order Input time 6 min 0 min
! Late Deliveries 33%` 3%
! Suppliers 34 6

Quality Management & Training Limited Slide -13-


26/05/99 - Geoff Vorley
What are the Benefits?
! Sets high standards
! Gives us knowledge of competitive methods
! Solidifies a commitment to excellence
! Becomes a tool for problem solving
! Increases awareness of costs and performance gaps
! Takes advantage of best practices
! Identifies the right standards and measurements for
evaluating our products and services
! Improves customer satisfaction

Quality Management & Training Limited Slide -14-


26/05/99 - Geoff Vorley
What are the problems?
! Pain and embarrassment when problems and gaps
are uncovered
! Denial
! Disbelief
! Dismay
! Lack of time and resources
! Resistance to change

Quality Management & Training Limited Slide -15-


26/05/99 - Geoff Vorley
Feedback & Summary
! What has been learned;
! Performance Measurement
! Bench Marking
! Hard & Soft Standards
! Data Collection and Analysis
! Define a way to apply training
! What are your views on Performance
measurement?

Quality Management & Training Limited Slide -16-


26/05/99 - Geoff Vorley
Evaluation Exercise
! What is the difference between comparison and
benchmarking?
! What is the benchmarking sequence?
! What methods can be used for data collection and
analysis

Quality Management & Training Limited Slide -17-


26/05/99 - Geoff Vorley