Worksheet # 5

•      BENCHMARKING:

Is a technique used to a measure something. The importance of benchmarking is not in the detailed mechanics of the comparison, but the impact that these comparisons can have on behavior. It can be considered a useful process towards achieving the necessary momentum to make improvements and changes.

Types of benchmarking

Internal: assumes that within an organization there are differences between the various work processes. Some of them may be more efficient and effective than other areas of the same company. Often, it is common that each department head or manager has a particular way of leading a group and carry out the work processes. Here what is sought is to establish the best practice within the organization and incorporate it into the company processes. The different degrees of effectiveness and efficiency recorded among the various sectors of the same company, make possible the application of internal benchmarking processes and discover the best practices of the organization. "

Benchmarking is the process of determining who is the very best, who sets the standard, and what that standard is. In baseball, you could argue that seven consecutive World Series Championships made the New York Yankees the benchmark.

• OUTSOURCING:

Outsourcing is a trend that has been an important part in management decisions in recent years in all companies worldwide. 

Basically it is a method whereby certain organizations, groups or individuals outside the company contracted to take over "part of the business" or a service point within it. The company delegated the management and operation of one of its processes or services to an external provider (Outsoucer), in order to streamline, improve quality and  reduce costs. 

To clarify Outsourcing is different from business relationships and contracting, since in the latter the contractor owns and controls the process, ie tells the supplier what and how you want to play and manufactured goods or services purchased by what the supplier can not change the instructions in any way. Outsourcing For the buyer transfers the property to the supplier, ie not instructed on how to perform the same task but one that focuses on communicating what results it wants and leaves the process of obtaining supplier.

The contracting company, or buyer, you benefit from an outsourcing relationship since it can in general terms, a "more functionality" that was internally with "lower cost" in most cases, under the economies of scale companies that get hired. In these cases the company is concerned only to define the functionality of the different areas of your organization, allowing the company outsourcing deal with decisions about technology, project management, implementation, management and operation of infrastructure.

• ALLIEANCE STRATEGIC:

For small businesses, strategic alliances are a way to work together with others towards a common goal while not losing their individuality. Alliances are a way of reaping the rewards of team effort - and the gains from forming strategic alliances appear to be substantial. Companies participating in alliances report that at much as 18 percent of their revenues comes from their alliances.

A strategic alliance is essentially a partnership in which you combine efforts in projects ranging from getting a better price for supplies by buying in bulk together to building a product together with each of you providing part of its production. The goal of alliances is to minimize risk while maximizing your leverage and profit. Alliances are often confused with merger, acquisition, and outsourcing. While there are similarities in the circumstances in which a business might consider one these solutions, they are far from the same. Mergers and acquisitions are permanent, structural changes in how the company exists. Outsourcing is simply a way of purchasing a functional service for the company.

Strategic alliances are becoming a more and more common tool for expanding the reach of your company without committing yourself to expensive internal expansions beyond your core business.

Businesses use strategic alliances to:

• achieve advantages of scale, scope and speed
• increase market penetration
• enhance competitiveness in domestic and/or global markets
• enhance product development
• develop new business opportunities through new products and services
• expand market development
• increase exports
• diversify
• create new businesses
• reduce costs.

• SIX  SIGMA:

Six Sigma is a proven disciplined approach for improving measurable results for any organization. Six sigma project success stories exist from organizations including manufacturing, service, nonprofit, government, research and healthcare. The key to Six Sigma is the completion of leadership sponsored projects.

Six Sigma is a methodology that provides businesses with the tools to improve the capability of their business processes. This increase in performance and decrease in process variation leads to defect reduction and vast improvement in profits, employee morale and quality of product.

Six Sigma is a rigorous and a systematic methodology that utilizes information (management by facts) and statistical analysis to measure and improve a company's operational performance, practices and systems by identifying and preventing 'defects' in manufacturing and service-related processes in order to anticipate and exceed expectations of all stakeholders to accomplish effectiveness.