Strategic benchmarking - when will it be useful?

strategic benchmarking

If you are serious about developing your business or you are simply interested in building a business from scratch, you've certainly come across this concept. Strategic benchmarking what is it really about? 

Around strategic benchmarking

The concept of strategic benchmarking is so complicated that it is worth explaining. We have collected examples and definitions in the following article, which may be helpful at the stage of developing a strategy for your company. 

Strategic benchmarking is quite an advanced concept from a marketer's dictionary. It is not even described in detail in the industry literature, and there are few Polish sources on this subject. This term has been appearing in scientific works for over a dozen years. The concept was first explored in the 1990s.

  Anna Balcerek-Wieszala at work "Contemporary concepts and types of benchmarking”(Scientific Papers of the University of Economics in Krakow, 2010) reminds us of where this concept came from. It turns out that the benchmark is a survey mark. It is placed on the wall during measurements in order to have a reference point for them. It was from there in the 1970s that the concept found its way into business. "In the 1980s, the leader of business benchmarking, Xerox, used this term to describe the process of comparing a company with its most important competitors.". In 1989, the first monograph on this subject was published. Based on the available sources, the author lists the types of benchmarking: 

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What is strategic benchmarking?

Strategic benchmarking consists in comparing the enterprise with the leader, although not necessarily from the same industry. It can be described as comparing yourself with the best in order to improve the quality of your offer. In this way, you can learn a lot from competitors without directly copying their performance.

Strategic benchmarking is an interesting tool that provides support at the even stage marketing auditwhether you plan to outsource it or carry it out in person. The expert responsible for your strategy should know them.

strategic benchmarking

"This method is based on learning best practices from leaders in a given field, and not by copying ready-made solutions, but by mimicking the ways of reaching them."- adds Weronika Chechłowska at work"The use of benchmarking when improving processes in the enterprise ". It focuses only on those aspects related to the strategy, the applied business model and the approach to running the company. Other types of benchmarking are responsible for internal processes or results. 

Strategic benchmarking goals

Strategic benchmarking can focus on a company from a completely different industry than the one in which the company operates. Why is such a comparison made? This allows you to evaluate its strategy, business choices such as investments, as well as to recognize a given market segment as a whole.

All this can be used to compare your own company with leaders in the current functioning of the company, and this gives potential interesting marketing or strategic ideas that give real sales support. However, benchmarking can also be used at the stage of a business plan or starting a business. Then the comparison will allow you to better assess the market and plan new opportunities, which will give you a chance to avoid some of the pitfalls faced by a company that is just starting.

strategic benchmarking

It is assumed that strategic benchmarking consists of five stages. In the first one, the object of comparison must be selected, bearing in mind that entire companies or sectors are less suitable for this than individual concepts or approaches. In the second step, you can choose the company that this particular approach does strategy implements successfully. The next step is to study the functioning of this company. The fourth step is to compare the conclusions of such an analysis with the company's strategy. In the last step, it is enough to implement these solutions in your own enterprise. 

Strategic benchmarking - an example

Larisa Dragolea and Denis Cotîrlea in the work "Benchmarking - a valid strategy for the long term?" provide known examples of strategic benchmarking at the meeting point of two companies from completely different industries:

  • - Motorola and Domino's Pizza,
  • - Xerox and LL Bean,
  • - Digital Equipment Corporation and Whirpool.


Strategic benchmarking has potentially great benefits, but also carries certain risks: "Organizations with little benchmarking experience can easily select a valuable pattern in a given industry. However, they are unable to discover how such impressive results have been achieved. Additionally, they often focus on external benchmarks, ignoring the internal, already existing benchmark".

The most famous example is Xerox's strategic benchmarking, because it was one of the first to use it on a large scale. The manufacturer of copiers for paper, recognized to this day, began to have serious problems in the 1980s. Companies from all over the world have already produced similar devices. High operating costs made Xerox copiers more expensive, not better quality. In 1982, one manager began to analyze the strategy of other companies. It turned out that the costs of Japanese competitors are 40-50 percent. lower. No wonder their copiers were also cheaper. In the following years, the competition strategy was analyzed strongly, gradually reducing operating costs and prices. It was then that a five-step benchmarking process was developed. The process was successful, and Xerox found its way into textbooks as an example of how strategic benchmarking works.  

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