Benchmarking: success producer or failure preventer?

Research on benchmarking has been extensive. It has not addressed the issue of how benchmarking impacts the capabilities or performance of firms. Benchmarking efforts may lead to either failure preventing or success producing capabilities. As firm capabilities evolve over time, it is critical to understand when benchmarking discoveries and eventual process changes, become success producers. A failure preventer may result from a firm using benchmarking practises to 'stay in the game' or status quo, merely maintaining their existence and resulting in efficiency as opposed to effectiveness. In this study, we relate research on operational strategy, capabilities, and firm performance to extend Varadarajan's research in the context of benchmarking in order to specifically identify when benchmarking is a success producer, leading to capabilities that result in a sustainable, competitive advantage. We develop a conceptual framework to demonstrate these linkages.

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