Lessons from:Fraunhofer Institute for Production Systems and

Design Technology

About:Benchmarking for Small

and Medium-Sized Enterprises

Goals

• A holistic view on quality becomes increasingly important for SME’s.

• Product and enterprise evaluations have shown that quality and productivity are not necessarily contradicting enterprise goals.

• Experienced SME’s already know that competition is not only reflected in product comparison.

• Increasingly competitive capacity is financially influenced by process aspects.

Goals (cont.

• Optimising products or parts of the work process is no longer sufficient, the consideration and analysis of the whole enterprise is required.

• The benchmarking method integrates existing management methods to achieve the preset goal through continuous implementation of the BenchmarkIndex.

Procedure• The benchmark method for SME’s is based on a

branch-intern database key figure comparison.• The key figure comparison is based on a

databank, which was built in the UK in 1996, and currently comprises 15 000 enterprises.

• The database allows a national as well as international comparison of enterprises (beyond Europe).

• Financial key figures, management key figures and business excellence figures are part of the comparison.

Procedure (cont• The companies enter relevant key figures into a

questionnaire and send them to the Information Centre Benchmarking.

• The validated key figures are then put anonymously into an online database.

• Subsequently the companies for the comparison are selected from the database according to benchmark criteria:– Turnover/year– Number of employees, and– SIC -code

Procedure (cont

• In a short period of time a report of enterprises’ strength and weakness profile is being generated.

• The report include classical key figures on profitability, finance and growth rate as well as key figures on supplier, customer satisfaction and employee satisfaction.

Procedure (cont• Drawn from the results of the report, the

interpretation of relevant strengths and open potential in each compared area is discussed with the company.

• The benchmarking results allow further conclusions on the evaluation of the company’s management practice.

• As the result of the discussion with the management, an action plan will be generated, through which the preset goals will be achieved.

Procedure (cont

• After the implementation of the action plan, the BenchmarkIndex should be carried out anew in the next year as a control mechanism.

5-Phases Concept of Benchmarking

REALISATION

COMPARISON

INTERN

AL

ANALYS

IS

CONCEPT

TARGETS

Achievements and Experiences

• Our experiences in the application of our benchmarking method for SME’s has revealed that the need for benchmarking is urged by the demand to get or renew certain certifications.

• The first search for a better solution then initiates the motivation to execute a benchmarking project.

Achievements and Experiences (cont

• Further motivation for implementing a benchmarking project for SME are the requirements for DIN ISO 9000:2000 / VDA 6.01 / QS 9000 certification, which demand benchmarking, i.e. continuous improvement process.

• On the other hand, many companies consider implementation of a benchmarking as a “pre-stage” of rating according to Base II (new requirements for credit rating systems for SME).

Achievements and Experiences (cont

• This method offers a more comprehensive enterprise comparison option, through branch comparison and the comparison of key figures, which go beyond financial figures, e.g. management key figures.

Our Offer for SME• There are opportunities for medium-sized enterprises to

implement a benchmarking comparison.• The offer is aimed at medium-sized enterprises in all

branches with a maximum of 500 employees and no more than 100 million Euro annual turnover.

• The service contains a comparison of financial and management data, as well as business excellence figures of the company within the branch.

• As a result, the enterprise receives a benchmarking report, in which relevant key figures are reflected and compared with other companies.

Established Key Figure Areas• Profitability• Financial Management• Productivity• Investment• Growth• Customer Satisfaction• Innovation Management• Supplier Management• Personnel Management• Employee Satisfaction Evaluation• Business Excellence Key Figures

END!