Paint & Coatings Industry - April 2008 - (Page 84)

Gaining a Competitive Advantage Using Benchmarking A s the coatings industry has continued th ti id t h ti d to mature, it has become increasingly competitive. H i Having a manuil titi facturing and distribution network that provides products to customers at the lowest possible cost will be a decisive factor in the success of all companies operating in the coatings industry. Furthermore, a successful strategy to increase market share by delivering preferred products and excellent service will be a key determinant of the winning companies. So how does one determine if his or her company’s costs, products and services are a source of competitive advantage or disadvantage? We believe that a good first step is benchmarking. Benchmarking Benchmarking is a process where companies compare business processes and metrics with the expectation of determining what ‘best-in-class’ performance is and how ‘best-in-class’ performance has been achieved. It is not always necessary for the benchmarked companies to be in exactly the same business. For example, it is possible to compare the accounts payable and accounts receivable functions within dissimilar businesses providing they have similar processes in those areas. Measuring and understanding how a business has been able to achieve best-in-class performance is only the first step in benchmarking. It is only by developing and implementing change because of the By Kevin Reid, Partner | Orr & Boss Inc., Plymouth, MI 84 APRIL 2008 | W W W . P C I M A G . C O M results of b h that lt f benchmarking th t a company is able t ki i bl to achieve best-in-class performance. Benchmarking is too often seen as a one-time B h ki it ft ti event. Continuous benchmarking or repetitive benchmarking will not only provide a snapshot of how you are performing at a particular point in time but how quickly the companies you are comparing yourself against are changing. We know of one segment of the coatings industry that conducts benchmarking every three years. In one instance, after a benchmarking study, one company implemented an extensive program to improve its operations to achieve best-in-class performance. When the next round of benchmarking was completed, the results showed they had improved considerably. However, one of their competitors had improved even more. Without the repetitive benchmarking they would not have had this understanding. Why Is Benchmarking Important in the Industry? The coatings industry is a mature industry. Growth rates for the next several years are expected to be in the 1.5% to 3% range, raw material prices continue to climb and margins are expected to continue to be squeezed. Any performance advantage that can be gained becomes a competitive advantage. Many coatings companies operate in isolation. The only cross-pollination of ideas that occurs is when http://WWW.PCIMAG.COM

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Paint & Coatings Industry - April 2008 Contents Viewpoint Industry News Calendar of Events Company News Mergers and Acquisitions Names in the News Snapshots of Success – Automotive Applications Designing UV-Curable Materials for High-Temperature Optical Fiber Applications The Future of UV Coatings is Now! Milling Media Review Part 1 – Bead Density Effect Preparation and Properties of UV-Curable Polyurethane Acrylate Resins for Metal Surfaces Conquering Color Harmony High-Performance PU Crosslinkers for Two-Component Waterborne Applications Decorative Film Laminates How Long Will the Gilding Glitter? Gaining a Competitive Advantage Using Benchmarking Supplier Showcase Materials Watch Products and Literature Classifieds Advertiser Index Automotive Color Trends New England Museum Solves Century-Old Vanderbilt Mansion Mystery

Paint & Coatings Industry - April 2008

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