A study in which components of a company’s contracted services, such as price, service levels and terms & conditions are compared to those of peer companies. Frequently, an independent entity with experience in peer organizations is called in to perform the study. For example, to assess IT performance, a research firm or advisor may collect the client\’s data and create reports to plot client performance against a selected reference group. This provides a somewhat objective assessment of the performance of the services. Benchmarking is a continuous process whereby an enterprise measures and compares all its functions, systems and practices against strong competitors, identifying quality gaps in the organization, and striving to achieve competitive advantage locally and globally.

Contributed by: TPI