Organizations work towards achieving the best result in theirrespective industries. The increasing number of companies in theindustries creates a high level of competition, and it forces theindividual companies to establish internal mechanisms for them toremain relevant. The management employees various structuresincluding the feedback they get from the consumers. The informationserves as the primary consideration when making important decisionsto improve their services (Bank, 2004 P 4). The management employstotal quality management that involves a comprehensive strategicapproach that aims at improving the quality of products and servicesby working with the feedback received from the clients (Basu &Nevan, 2003 P6).
Benchmarking is one of the processes that help organizations toimprove their performance. Companies in various industries cancustomize their benchmarking process and forge it to reflect theindustry specific needs (Bank, 2004 P 5). Benchmarking is anassessment of the quality of organization policies, programs andstrategies and a juxtaposition of the strategies with the standardmeasurement of another company in the same industry. It helps inpointing out any processes that may be lagging behind the industrypractices and instigates the management in revitalizing anyconventional practices.
According to Oakland (2014), the management undertakes to benchmarkfor various reasons. First, they see to assess whether a company isperforming the activities in its value chain in an efficient way.Most of the processes in a company reflect a significant uniformity(149). Therefore, a company can compare its practices with those ofsimilar companies and determine their effectiveness. The input that acompany employs in reducing the cost of production leads to acontinuous process of change. A company in the benchmarking processcan learn a lot from its competitors who have invented new proceduresthat give them a competitive advantage (149). For example, acompetitor may be using robots to pack items in boxes, and this maysignificantly cut on the manual cost of packaging. Consequently, thefinal price attached to the products may be slightly lower than thatof another company using human labor. A company can borrow thispractice and include the procurement of robots in its short-termplan.
Secondly, benchmarking aids in making improvements in the variouswork procedures. As Oakland (2012) notes, the process involves a lotof comparisons, a company learns the some of the methods used byothers in the industry that lead to efficiency (149) Therefore, itmay resolve to improve some o the processes to catch up with itscompetitors. For example, some companies may have fast clearanceprocedures that do not have lengthy bureaucracies. The benchmarkingcompany may borrow such a practice to improve on its clearance.
Also as Beckford (2002) agrees, organizations use benchmarking togain a competitive advantage over their competitors (257). Most ofthe companies try to diversify their prices of increasing theircustomers’ satisfaction. For example, they might have uniquedistribution strategies and methods o collecting feedback. Usingbenchmarking, organization can point out the non-exploited businesspractices or improve on the ones used by their competitors. The ideathat one organization terms a unique may be having gaps that may befilled by another company to its advantage (Oakland, 2012 P 149).Therefore, a benchmarking company gains a competitive advantage overits competitors by improving the structures that a competitor deemsas a mileage in the industry.
The tourism and travel industry has embraced total qualitymanagement, and many companies employ benchmarking to improve theirservice delivery. Trek America is one of the leading to travel andtourism in the country, and it extends its services to Canada, Alaskaand Central America. The company offers all year round services thatinclude more than five itineraries ranging from three to 80 day inlength. The company started offering its services in 1972 making itthe longest serving company to offer services in North America.Travelers seeking to visit memorable destination get a chance tovisit the best beaches in California and the best music hubs in NewOrleans (Trek America, 2015). Also, clients get surprise stops indestinations they never have visited. These attributes have made TrekAmerica one of the most successful tourism companies in America. In2014, the company received two gold awards at the prestigious BritishTravel Awards. They included the Best Holiday Company and The BestSmall Holiday Company in the United States for the fifth time in arow. The company bagged the bronze award for The Best Small SinglesHoliday Company (Trek America, 2015).
However, with the increasing popularity, the company is on the vergeof having its competitors intensifying their efforts to get acompetitive edge. Therefore, the awards may become obsolete if themanagement does not conduct a successful benchmarking to continuebeing on the frontline in innovation and efficiency. Conducting asuccessful benchmarking will assist the company in identifying whatit competitors have in the underway and improve its less efficientservice delivery mechanisms (Beckford, 2002, P 258). In conducting asuccessful benchmarking, the management will act in compliance withthe whole process that involves several steps.
Step 1:Identifying what and whom to benchmark
The first phase is important in laying the groundwork for the wholeprocess. The top management comes in handy to instigate the process,and it is usually the main source of the idea. According to Beckford(2002), the management points out the processes that may determinethe success of the company (258).The Trek America management willhave to shortlist the strategies and process through a prioritizationprocess. A top-down approach is essential during this process. Theemployees of the company will assist the management in identifyingany observable gaps before using the information from other companiesto identify other gaps. Studying the customers’ critical quality isinstrumental in the prioritization process. According to the Balridgemodel of total quality control, the leadership of an organization isthe first element in setting the pace for the other components in theprocess (Oakland, 2012 P 18). The end results of the benchmarkingprocess, therefore, require the input of the management.
During this phase, the organization comes up with a list of thosecompanies in which they will conduct a benchmark. The managementmostly includes the close competitors who use varied methods toachieve a competitive edge. Trek America is a leading company in thesmall organizations category. Therefore, it is possible that most ofthe competitors are trying to diversify on the methods employed bythe company to beat the competition. Benchmarking the closecompetitors will help in determining the measures that they have putin place to leverage the competition and build on them. As Deming(2000) puts it, the management has to review several competitors toachieve the best results (2). Some of the companies that compete withTrek America include Go Collette, North America Tours, MayflowerTours and Intrepid.
Step 2: Data collection on the superior process
After shortlisting the companies to be benchmarked, the managementdecides on the processes to study within these companies (Evans, 2002P 235). For example, Trek America will study the above closecompetitors’’ processes and key strategies to learn from them.However, it is one of the most difficult phases since it is not readyto project whether the companies will be willing to give authenticinformation about their process. Therefore, it needs a criticalpreparation such that a visit to the company will derive as muchinformation as possible. Not all the process in these companies willrequire benchmarking since some of them may be well known and therewill be no need for reevaluation.
Also, the Trek Management has to decide on the best tools to use forthe data collection. The involvement of vital stakeholders becomes animportant input since some of them will be involved in the datacollection. The processes determine a favorable for benchmarkingdictates the tool to be used. The Trek America management and thestakeholders involved in the benchmarking process have to embrace theconcept of comparability of the processes. Therefore, it will requirea brief analysis of the company’s internal processes that areprimary to the success of the company and comparing them with thoseof the competitors.
Step 3: Data analysis
After collecting the data from the identified companies, Trekmanagement will analyze it to make the necessary comparisons andidentify the existing gaps and need for change. The adoption of a newphilosophy may be difficult without the right comparisons (Rolstadas,2012 P 54). A model for total quality department developed by theAmerican gurus including Edwards Deming, Joseph Juran and PhilipCrosby points out that the improvement of organizations processesdepends on the ability to assess the new trends and to adopt the onesthat are compatible with the internal structures(Oakland, 2012 P 19).Therefore, data collection is instrumental in the benchmarkingprocess.
The Trek America management and the parties taking part in thebenchmarking will have first to validate all the informationcollected to avoid at arriving at inconsistent conclusions. It willensure accuracy and completeness of the resolutions to makeadjustments to the company’s procedures. Another important factorin this phase is the outlining of the strengths and weaknesses of thebenchmarked company that specifically focuses on the pre-identifiedprocess in the first step. If possible, there should be aquantification of the strengths and the weaknesses (Goetsch &Davis, 2014 P 137). The gaps identified inform the management on thegaps that exist between the two companies. Similarly, a weaknessobserved in one company may be resolved by the practices of anothercompany, and this saves the benchmarking company from the trouble ofdeveloping new solutions since they can build on the ones used by thesuccessful companies.
Step 4: Reporting
After analyzing the data and making comparisons, the company willcome up with the gaps that need filling to remain on top of theothers in the industry. The information is availed to the relevantdepartments using the most appropriate channels. According to Hoyle(2007), a concise understanding of the identified gaps and theresolutions necessary to give the company a competitive edge shouldfollow reporting (156). Without understanding and the extent to whichthe resolutions can propel the company, the primary stakeholders likethe workers, team leaders and team managers might view it as aroutine practice that does not mean a lot to the business. Also, itwill help in owning up the process and, therefore, facilitate theadoption process.
The Baldridge model of total quality management places results at theend of the of a successful implementation strategic process. In themodel, communication takes place at every transition phase that is,from the leadership to the strategic planning that identifies thecustomer and market interest (Oakland, 2012 P 19). Communication alsoencompasses the human resources and the process management, and allthese components contribute to the final results. Therefore, TrekAmerica is not averse to this process, and the management must upholdconsistent reporting and communication.
Step 5: Leaning from the best practices
Most of the competitors in any industry try to learn from each otheralthough the information disclosed may be limited. The data analysisdome n step three will allow Trek America to come u with a list ofthe best practices that other companies may be using to make theirprocesses efficient. As Powell (1995) puts it, there is mutuallearning that takes place and although the information may be limitedcertain processes (16). Performing companies also seek to learn fromthose below them to smarten their strategies. Trek Africa falls inthe category of the top performing companies, and there is apossibility that it will find mutual partners for benchmarking sinceits competitors will be willing for a consideration when undertakinga similar activity.
Step 6: Planning and implementing the improvement actions
There is a need to develop a framework that is consistent with thecompany’s financial and expertise capacity. The insights gainedfrom the practices of another company have to be embedded into theoperations of the company (Vorhies & Morgan, 2005 P 93).
Step 7: Institutionalizing learning
When adopting the new practices adopted from the benchmarkedcompany’s, Trek America will consider the sustainability of themethods. Therefore, not all the strategies obtained from thebenchmarking will be rolled out immediately without the managementputting in place the appropriate structures. The rationale for thisis that some procedures are very specific such that they cannot beintegrated into the company’s processes without adjusting thesystems. For example, the marketing plan use by North America Toursinvolves a lot of internet advertising more than Trek America.Therefore, Trek America cannot integrate this into it printadvertising without bringing together a team of online marketers andsystem administrators.
There are various challenges that the company may face whilebenchmarking. Granularity is a problem likely to be encounter.Oakland (2012), notes that the benchmarked practices may be toogeneral or too specific (157). For example, if the company resolvesto benchmark operational excellence for one of its competitors, theterm might be broad to be benchmarked as a blankets strategy. Othersmay be too specific to stand on their own. Therefore, the first phaseof the benchmarking is imperative in identifying viable methods forbenchmarking.
Secondly, there is a possibility of the company lacking quality andconsistent data from the benchmarked companies. In an industry,companies use fairly the same principles that they later diversify toachieve a unique face. Therefore, when collecting data for a specificwork procedure, there are high chances that the companies havesimilar concepts but with diversified approaches (Oakland, 2012 P159). When collecting data on a particular strategy, for example,operational excellence, some companies will provide at while otherswill be reluctant. Therefore, it becomes difficult to conduct a crosscomparison.
Lastly, it can be an uphill task to get value from the resultsobtained from the benchmarking process. The final phase of theprocess involves developing structures for sustainability. Some ofthe learned practices require a paradigm shift in the organizationalculture (Oakland, 2012 P 160). Therefore, it requires intensivecommunication and efforts for owning the new practices. Rigidinternal practices may hinder this process, and it may result in thefutility of the whole process.
To avoid these drawbacks, the team spearheading the benchmarkingprocess should have a full understanding of the information requiredin the process. It will reduce the tendency of rigidity whilecollecting data. For example, information withheld orally can begotten through observation to a certain extent. Therefore with theinformation at their fingertips, the team will use varied methods toget the same answers (Vorhies & Morgan, 2005 93). Secondly, theoperational fields to be benchmarked should be clearly stated andhave insight laid upon them before visiting the companies to bebenchmarked. The general o the overly specific nature of the itemsshould be crosschecked during the first phase. To enhance thesustainability of the best practices, the company should be carefulnot to operationalize the processes that cannot be supported by theexisting systems. The procedures that can be adopted immediately byintegrating them into the already running processes should bedistinguished from those that may require time and resources beforethey become operational (Oaksland, 2012 P 161). A close monitoringand evaluation should follow to identify any hitches or desirablesoutcomes of the practices. Those that do not exhibit desirableoutcomes should be revised or exempted from the company’soperations altogether.
In conclusion, benchmarking is important for a company to operatewithin the best practices in the industries. It helps to beat thecompetition and in the adoption of the efficient methods. TrekAmerica can collect data on the process it deems as important tolearn from its competitors and use it sustainably to retain itsposition as a leader in the tourism industry. However, diligenceshould be observed not to benchmark on general or overly specificpractices that cannot be embedded in the company. The preliminarypreparations should come up with a list of viable companies andmethods that are compatible with the company’s practices eitherdefinitely or through simple adjustments. A successful implementationfollowed by a close monitoring will result in desirable outcomes.
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