How do you benchmark your food manufacturing performance against your competitors and industry standards?

1 Why benchmark?

Benchmarking is a great way to reach several goals, such as improving product quality and safety, reducing costs and waste, increasing productivity and efficiency, and boosting customer satisfaction. Through benchmarking, you can learn from the best practices and innovations of other food manufacturers, and apply them to your own situation. This can help you gain a competitive edge and strengthen your market position.

2 How to benchmark?

Benchmarking is not a one-time event, but an ongoing process of learning and improvement. It involves four key steps: planning, analyzing, implementing, and reviewing. During the planning stage, you must define the scope, objectives, and criteria for benchmarking. Additionally, you should identify key performance indicators (KPIs) and metrics to measure your performance. Select benchmarking partners such as direct competitors or industry leaders and collect relevant data from them. After analyzing the performance data in comparison to the benchmarking partners, you can identify any gaps or strengths. Analyze the root causes behind the differences and understand the best practices and innovations associated with them. Subsequently, develop and prioritize action plans to close any gaps or leverage strengths. Implement changes and improvements in processes, systems, and culture while monitoring and evaluating the results of your actions. Finally, review your benchmarking process and outcomes to identify lessons learned and areas for improvement. Communicate findings with stakeholders and repeat the cycle as needed, updating benchmarks accordingly.

3 What to benchmark?

Benchmarking is an important part of food manufacturing performance, as it can help you identify strengths and weaknesses, as well as learn from industry leaders. Depending on your goals, you can benchmark product quality, product innovation, process efficiency, cost reduction, waste reduction, and environmental performance. For example, you can compare your product specifications and testing methods with ISO or HACCP standards. Additionally, you can benchmark your process inputs and outputs with OEE or TPM benchmarks. Furthermore, you can measure your cost structure and drivers against COGS or SG&A benchmarks. Moreover, you can compare your waste generation and disposal methods with ZWTL or 3R standards. Lastly, you can benchmark your environmental impacts with GHG or GRI standards.

4 What are the challenges?

Benchmarking is not without its challenges, and it's important to be aware of them and address them accordingly. Data availability may be hindered by confidentiality, privacy, or legal issues. As a result, you may need to use alternative sources, such as public reports or surveys, or estimate the data using proxies or assumptions. Additionally, data quality may be inconsistent due to different definitions, methods, or formats. You may need to validate, normalize, or adjust the data to ensure its quality and comparability. Furthermore, interpreting the data and drawing meaningful insights and conclusions from it can be difficult due to complexity, variability, or context. You may need to use appropriate tools and frameworks to analyze the data and understand the underlying factors and relationships. Finally, you may face resistance in implementing the changes based on the data due to organizational culture or resources. Involving stakeholders and benchmarking partners can help ensure their support and collaboration.

5 What are the best practices?

Benchmarking is a complex process, and to make it successful and effective, you need to follow certain best practices. Start by defining your purpose and scope clearly, and ensure they are aligned with your strategic goals and priorities. Additionally, it is important to choose benchmarking partners carefully and selectively, and make sure they are relevant to your situation and needs. You should also collect and analyze data from multiple sources systematically and objectively, as well as continuously review the actions and outcomes. Furthermore, it is important to learn from the experience gained from benchmarking and share this knowledge. Finally, you should foster a culture of learning and improvement in your organization.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?