What is one example of internal benchmarking?

Internal benchmarking refers to the process of comparing and measuring performance or processes within the same organization across different departments, regions, or units. Assessing sales performance across different regions provides a clear example of internal benchmarking, as it involves evaluating how various parts of the same organization are performing against each other.

This method allows for identifying best practices within the company, highlighting strengths and weaknesses, and fostering a culture of continuous improvement. By comparing sales data from different regions, a company can gain insights into which areas are performing well and which may need additional focus or resources for improvement.

In contrast, comparing service levels with a competitor, measuring marketing effectiveness in the industry, and evaluating financial metrics against industry standards all involve external benchmarking. These approaches focus on comparing an organization’s performance with external entities, which help glean insights from competitors or industry averages, but they do not provide the same insights that internal benchmarking does regarding organizational efficiencies and practices.