Benchmarking

What’s benchmarking?

Benchmarking is the process of analysing and comparing to identifying “best practice” in a business. And to identify areas and means of improvement. The benchmarking process can take place inside a particular industry, and also in other completely different industries.

In the automotive industry benchmarking is key. Car manufacturers need to compete for sales since the supply capacity exceeds demand. Design, features, technology, producing methods, efficiency in design and manufacture… are some of the benchmarked points between brands.

Evaluating the capacity of the competitors is always important. You may have a really good methodology of doing something. However, someone could have found a more efficient way of doing it. Greater efficiency means reduced cost.

Where?

As we have seen benchmarking is a powerful tool to get ideas from your competitors. But, sometimes what manufacturers want is to differentiate themselves from their competitors. In this case benchmarking is also used. Take for instance that a company wants to redesign the seats of their cars. They will need to think thoroughfully in ergonomics. So, the brand could benchmark specialized companies in making furniture, particularly chairs and sofas.

Processes are also benchmarked. In most cases the way you design and manufacture has a significant influence in its cost, quality and reliability. New technology and materials are often triggers for new processes to be devised. Product development processes are also benchmarked, brands can reduce their costs and time effort dramatically. Computer design, quality control and organization of activities are some of the targets.

The benchmarking activity can take place though company mergers, manufacturer’s alliances, publication of technical papers, selling of quality initiative programmes to corporations by consultancy firms.

How?

First of all, brands need to identify the market competitors. Competitors are usually the market leaders in the segment in terms of sales, price, specification and performance.

Sometimes other market segments and not direct competitors are also benchmarked. These cars are taken into the analysis because they have some special features of interest in the new car. For example: packaging styling, aerodynamics, assembly techniques, technology…

Benchmarking can take place in different ways, as a programmed activity or as an on-going process. A programmed activity is when the company is developing a new vehicle. The on-going process is run by an specific department which assesses the vehicles to make a library of reference material for engineers and designers.

It is easy for manufacturers to buy and test the competence’s products. However, most manufacturers have exchange systems. So that they lent each other the cars for testing. This could represent a huge amount of savings.

Normally how companies benchmark their competence cars is done is a structured way and putting the effort to no to be biased in the subjective tests. The typical procedure is the following:

Static View: Panel gaps, paint finish, under bonnet appearance…
Vehicle Data: Package data, aerodynamic data… (some of these information can be found in the brochures and press packs).
Subjective Assessments: ride, handling… Rating charts are used to ensure objectivity. Training and experience helps too.
Objective Assessments: wind tunnel for aerodynamics and wind noise, climatic tunnel for heating, air conditioning…
Teardown: Used to gain a better appreciation of manufacturing and design for assembly ideas.

All the data collected during the benchmarking activity will be kept in detailed reports available for designers and engineers.

To sum up, benchmarking is an essential element in the motor industry. It is quite time consuming yet no company wants to fall behind. I don’t know about you, but when I was told that companies have exchange programmes I was surprised!!!