Benchmark vs Baseline
Difference between benchmark and baseline is that benchmark is comparing the performance of a company with the best practices in the industry; baseline is setting up a framework before any project starts, that can be used as a basis for implementation. Both these techniques are performance measuring tools. This article analyses these two concepts, benchmark and baseline, briefly.
What is Benchmark?
Benchmark is a specific standard or set of standards used in evaluating the performance of the company or the level of quality standards. Benchmarking is a measurement used to compare the company position with another best performing company within the industry.
In the organizational context, managers compare the performances of their products or processes with their competitors and best in class companies and their internal operations that are similar to their activities. Companies used benchmarking to,
• Improve the company performance by identifying various methods of improving product designs and operational efficiencies.
• Determine the relative cost position in order to identify the opportunities for improvement.
• Incorporate the best practices into the company operations in order to gain competitive advantage.
• Increase the rate of organizational learning that brings new ideas into the company and facilitates experience sharing.
What is Baseline?
A baseline assessment is a crucial element in research and planning and in any monitoring and evaluation framework. Baseline assessments are conducted before starting a particular task in order to examine the changes of intervention. It is established as a basis for comparing the situation before and after the intervention for a specific task.
The baseline is a concept frequently used in project management. In a project, baseline refers to the initial cost, scope and schedule of the project. The baseline is established before a particular project begins. It is kind of a framework within which can be referred at any time during the implementation of the project.
When the project sponsor requests a change or team members identifies that the project requires a specific change, then the baseline documents must be changed accordingly. Before closing the project, the team members examine the baseline document in order to check whether the project specifications are met.
What is the difference between Benchmark and Baseline?
• Benchmark and baseline are performance measuring tools used in business organizations.
• Benchmark compares the company performances with competitors or peers while baseline compares the performance with its own historical performances.
• Benchmark is useful to measure both positive and negative implications. If the company performance decreases relative to the trend then the problems can be investigated or else if the company performance can be improved, by incorporating the best practices.
• Baseline is established before starting a project and can be used as a reference while implementing the project.