The rivalry between BMW and Mercedes has been one of the greatest in the automotive industry. You can’t argue with that. The recent departure of Daimler CEO Dieter Zetsche has reminded us that respect to your competitor should be, without a doubt, firmly embedded in the business philosophy.

The latest advert from BMW is arguably the best way to put that point across. Have a quick look if you haven’t seen it yet:

Many business owners see competition as a threat. They focus on a constant battle against others who take the share of the market. At what cost? Long term consequences can be dramatic.

An alternative approach is to embrace competition to improve product or service for the benefit of all stakeholders. Instead of fighting, learn, understand and develop. Benchmarking against the others in the market can elevate the company to another level.

Benchmarking is not copying

There are four different types of benchmarking:

• product,
• process,
• performance,
• strategic

Regardless of choice, here are the questions you should ask.

• Why are other companies better at what they do?
• How are they better?
• What can we learn from them?
• How far are we behind?
• How quickly can we reach their standards?
• How can we become better over time?

Why benchmarking?

Benchmarking can only be successful if the top management fully supports it. There can be substantial work involved to achieve the intended results. Therefore resource, skills and know-how have to be taken into consideration. Most importantly, the entire process must be aligned with company philosophy and strategy. If that’s the case, actual benefits can include:

• Improvement in the performance,
• Appreciation of the latest technology,
• Meeting customer expectations,
• Innovation in management,
• Achieving quality and regulatory standards,
• Creativity and out-of-the-box thinking

Benchmarking is only one of many tools that can contribute to continuous improvement. If you want to learn more about other great tools, click the link below:

A definite list of 7 tools you need to improve your business

What do you think of benchmarking as a mean to elevate the business to the next level? I have heard people discussing benchmarking without a clue what it means. Another buzz word for networking events. What’s your take on it?