Benchmarking is a market-based institution

Benchmarking allows companies to improve their competitive position in the industry by learning from the experience of other market participants, which means that understanding benchmarking significantly reduces its strategic potential.

First, it is very difficult to get absolutely complete information about the working methods and technologies used by competitors in practice. Moreover, even if an enterprise has such information, it is not possible to fully produce someone’s experience due to the lack of certain resources, as well as the specific characteristics of the markets and ways of organizing the business1.

Second, it is a creative component of benchmarking as a tool to help improve the organization, which is characterized by high efficiency. The research results should not be simply copied and applied to the enterprise, but the research team should be superior to them, i.e. the project results should be synergized. Exact results synergy and creative thinking allow businesses to achieve the best results through benchmarking.

A common approach applied to competitive benchmarking is to procure competing products to conduct a detailed engineering analysis of products, services, and processes. Without knowledge of the activities of competitors, it is impossible to create competitive world-class products, especially in a competitive automotive market. In practice, most of the largest foreign automakers disassemble cars produced by competitors and carefully analyze the design, comparing assembly methods, quality, and component design into parts. Packaging, applicable manuals, instructions, service life, warranties, delivery, etc. are carefully studied to provide valuable information about the advantages and disadvantages of competitors ’products and the effectiveness of their work.

Practice shows that benchmarking is used by large companies that interact with world standards and foreign partners that lead the world market. The largest corporations, including the automotive industry, are focusing their efforts on seeking and developing new management methods in search of competitive advantages. These studies are of a global nature, and the most successful solutions become separate areas of management, for which a theoretical and methodological basis is created2.

Benchmarking is a market-based institution that helps organizations solve emerging problems. Benchmarking refers to the process of continuous measurement and comparison of the methods and results of the work of an organization, its individual divisions and functions, processes, products and services produced with organizations chosen as role models in order to collect information that will help the organization in question determine the direction of its improvement and take measures to improving performance and increasing competitiveness.

Due to the high level of competition, maintaining the achievements of past years and even their slight improvement does not give results in increasing and maintaining competitiveness, therefore, organizations must regularly check the effectiveness of previous achievements, develop the ability to quickly respond to changing conditions and maintain a high degree of customer satisfaction. Consequently, benchmarking is not a one-time activity, today it should be formally established in an organization as an institution, become an integral part of the process of innovation and improvement in business.

The available information on benchmarking problems can be divided into two areas: the theoretical foundations of benchmarking based on foreign sources and the practical experience of individual companies in the use of benchmarking technologies.

General theoretical issues of competition, competitive advantages and competitiveness were reflected in the works of such foreign and domestic scientists as G.L. Azoev, G.L. Nagiyev, F. Kotler, I. M. Lifitz, M. Porter, Yu. Yu. Rubin, S. G. Svetunkov, A. Strickland, A. Thompson, R. A. Fatkhutdinov, A. Yu. Yudanov and others.

Increasing the competitiveness of organizations largely depends on the ability and quality of managing competitive advantages. It is customary to understand competitive advantage as those characteristics that create a certain superiority over its competitors for the organization producing or selling a given product. These characteristics can be different and relate both to the product and service itself, and to the peculiarities of the organization's business processes. Such superiority is relative and is determined in comparison with other organizations through benchmarking. In order to maintain and increase its competitiveness, the organization must constantly carry out adequate strategic and operational changes, acquire new competitive advantages, at least as fast as its competitors will copy existing ones. Without using the capabilities of the market benchmarking institution, it is extremely difficult to organize a process of continuous improvement of the organization's performance, which requires benchmarks for the performance of other organizations, as well as knowledge of the best business practices of direct competitors and industry leaders3.

The preconditions for the emergence of benchmarking and the subsequent process of its institutionalization were the processes of toughening competition in world markets along with the beginning of globalization of world trade, as a result of which the opportunities for access to information on the activities of leading world corporations have significantly expanded. Benchmarking has a history of several decades.

The event that marked the beginning of the institutional stage in the development of benchmarking was the establishment of several centers for the exchange of best practices that collect, classify and disseminate information, products and services within the framework of benchmarking. Such organizations subsequently became the main subjects of benchmarking in the world. At the current institutional stage of the development of benchmarking, it seems necessary to focus on the categorical definition of it as a market institution. The foundation of the benchmarking institute is the relationship of agreement that arises between the subjects of benchmarking in the process of sharing best practices. The concept of a consensus relationship is based on the orderly exchange of information, creating and maintaining the necessary connections and contacts with benchmarking partners.

To increase the efficiency of management, it is necessary to implement the following measures based on interaction with the company's departments and network enterprises:

• 1.    Coordination of work on the development of pricing policy in the enterprises of the industry in order to form the optimal pricing and cost of products;

• 2.    Activation of regular marketing research (in conjunction with the Company's marketing services), identification of new trends and changes in the domestic and foreign markets, as well as preparation of proposals and recommendations on the production plan for the volume and range of products (services).

• 3.    Introduction of modern information and communication technologies;