ACCA Strategic Professional · Strategic Business Leader · The internal resources, capabilities and competences of an organisation
Halden Logistics, a regional freight company, compares its delivery times, fuel use per kilometre and customer complaint rates with those of Brightway Freight, a competitor in the same market. The board wants to know where Halden stands relative to direct rivals. Which type of benchmarking is Halden using?
Halden is using competitive benchmarking because it compares its own performance measures with those of a direct rival in the same market. Internal benchmarking would compare its own units, and functional benchmarking would use firms from other industries, so neither fits this case.
- AInternal benchmarking
- BCompetitive benchmarkingCorrect
- CFunctional (generic) benchmarking
- DProcess benchmarking against a company in an unrelated industry
Explanation
Halden is comparing its performance with a direct rival in the same market, which is competitive benchmarking. Internal benchmarking compares units within the same organisation. Functional benchmarking looks at similar functions in firms from other industries, which is not the case here because Brightway is a direct competitor.
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