CBI unveils benchmarking plan

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The Independent Online

Business Editor

The Confederation of British Industry is to use its annual conference in two weeks' time to launch a national "benchmarking" service for companies in conjunction with IBM and the London Business School.

The service will use a computer database to compare companies' performance with the best in their industries.

Benchmarking has become one of the centrepieces of the Government's competitiveness drive, which is being overseen by Michael Heseltine, the Deputy Prime Minister.

The Department of Trade and Industry is developing its own complementary service, targeted at smaller companies than the CBI scheme - those with fewer than 60 employees.

Tim Eggar, the industry minister, claims no other country will have what he describes as "user-friendly" benchmarking systems on such a large scale. He describes them as "self- check mechanisms."

The theory is that by ranking themselves against competitors on a range of criteria, companies are provided with an essential first step to identifying what they need do to improve their competitiveness.

IBM and the London Business School have done a detailed assessment of corporate best practice in more than 600 manufacturing companies in the UK, Germany and the Netherlands. This database is being used to provide the performance benchmarks.

The services will be operated on personal computers through the CBI, Business Links, government offices and trade associations. The service will take about two days to complete. It will begin with a questionnaire, followed by visits to the company from specialists who assess performance against the database, which has been effectively given to the employers' organisation.

Both the DTI and the CBI are to charge for their services, with the CBI fee expected to be about pounds 1,000.

The Government's enthusiasm for benchmarking is based on studies that show that Britain has its fair share of world-class companies in size and quality of service but an unusually large number of laggards as well, which drag down national performance compared with the chief competitor countries. In the UK, companies have a comparatively good record on customer service, but firms generally compare poorly on factors such as degree of automation, equipment layout in factories and employee involvement.