CMA Final · Strategic Cost Management · Benchmarking
Which type of benchmarking compares a firm's processes with those of a best-in-class organisation in an entirely different industry, for example a hospital studying a courier firm's tracking system?
This is functional or generic benchmarking. It compares a specific process with the best-in-class performer irrespective of industry. Competitive benchmarking is limited to direct competitors and internal benchmarking compares units within the same organisation, so neither fits a hospital studying a courier firm.
- AInternal benchmarking
- BCompetitive benchmarking
- CFunctional (generic) benchmarkingCorrect
- DStrategic benchmarking of financial ratios only
Explanation
Functional or generic benchmarking looks at a similar function or process in any industry, so a hospital learning from a courier firm's tracking fits. Competitive benchmarking is restricted to direct competitors, and internal benchmarking compares units inside the same organisation.
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