Benchmarking in Business & Public Sectors: A Comparative Analysis

This report provides a comprehensive overview of benchmarking, defining it as a process where an entity analyzes itself by comparing its key methods and functions with another organization of the same type. It highlights the importance of benchmarking in identifying areas for improvement and understanding market and customer needs. The report outlines different types of benchmarking, including peer benchmarking, best practice benchmarking, and collaborative benchmarking, and details the benchmarking process, which involves planning, data collection, data analysis, and implementation. Furthermore, the report critically analyzes the application of benchmarking in the Netherlands public sector, emphasizing its role in improving public services to meet citizen expectations and bridge the gap between the public and private sectors. It suggests that benchmarking helps public sector organizations identify vital areas for improvement and enhance accountability, using examples such as banks and public hospitals to illustrate its practical application.

Benchmarking
Question 1
According to Cull et al. (2014), benchmarking is the process in which a given entity analyses
itself by comparing its key methods and function using another organization of the same type. In
the world of business, benchmarking is a significant activity as it can show clearly why the
business is failing in one way or the other as another one of the same type is improving
tremendously. Companies or organizations do not engage in benchmarking without any clear
aim, however, the process has some positive impact on the business or organization. For
instance, participating in benchmarking assist an entity to know what both market and customers
need in order to stay connected to the same organization for a long period of time in reference to
Duan et al. (2016: p.1334). A school or a business may be operating eight hours in a day thinking
they are satisfying the clients but they can get a huge shock that that is not enough when they
engage in benchmarking.
McCrory et al. (2015: p.4350) say that there are various types of benchmarking that an entity
may engage in from one time to another. The first one is the peer benchmarking. It is a type of
benchmarking where an entity compares itself with a similar entity. Secondly, the best practice is
another benchmarking where an organization approaches another entity that they would operate
the same way. In this case, the approached entity is always ahead of the other one. Collaborative
benchmarking is another type whereby several companies form a group and they constantly
compare with each other for the sake of improving their services to the customers.
The process of benchmarking begins with planning. In this stage, the entity outlines what it
desires to compare with another organization. The second stage is the collection of data. The

entity needs to have both primary and secondary information from the company they are doing a
comparison with at that moment. After collection is the analysis of the collected data in order to
identify the gaps. Lastly, it is the implementation of the result collected from the analysis stage
and ensuring they are continuously monitored.
Question 2
In numerous areas of the public sector in the Netherlands, benchmarking is used to ensure that
the services delivered by the public sectors satisfy the customers’ needs the way private sectors
do. Benchmarking suggests various ways of improving the services in the public sector due to
the widening gap between the private sector and the public sector in reference to Zhu (2014).
During the public-sector benchmarking, the organizations in the public sector first identify the
vital areas to perform benchmarking. The areas chosen are assumed to be of higher benefits
when the company improves.
The citizens always vote to give a mandate to the leaders. One of the mandates is improving the
public-sector services such as those of hospitals and schools. For instance, if you take the
example of a bank, when there is no accountability and continuous benchmarking, the economy
of the country may drop day by day. Benchmarking can assist the banks to increase the working
hours and lay strategy on how to improve the flow of money in the country. Secondly, in the
public hospital, for instance, there are always performance indicators. The one way is to ask the
clients whether they are satisfied with the services. The customers always recommend the goods.
Consequently, the demand from the public to ensure that the public sector meets the expectation
is one of the ways that have resulted in continuous benchmarking.
.

References
Cull, R., Harten, S., Nishida, I. and Bull, G., 2014. Benchmarking the financial performance,
growth, and outreach of greenfield microfinance institutions in Sub-Saharan Africa. The
World Bank.
Duan, Y., Chen, X., Houthooft, R., Schulman, J. and Abbeel, P., 2016, June. Benchmarking deep
reinforcement learning for continuous control. In International Conference on Machine
Learning (pp. 1329-1338).
McCrory, C.C., Jung, S., Ferrer, I.M., Chatman, S.M., Peters, J.C. and Jaramillo, T.F., 2015.
Benchmarking hydrogen evolving reaction and oxygen evolving reaction electrocatalysts
for solar water splitting devices. Journal of the American Chemical Society, 137(13),
pp.4347-4357.
Zhu, J., 2014. Quantitative models for performance evaluation and benchmarking: data
envelopment analysis with spreadsheets (Vol. 213). Springer.