Benchmarking

Benchmarking techniques evolved from Xerox’s pioneering visit to Japan in the late 1970s. However, the application of the benchmarking concept to the banking industry did not take place until the late 1990s. technique benchmarking, in particular, is a gizmo that helps FIs to cut costs, improve productivity and integrate business processes. Although technique benchmarking involves divulging what may be considered as sensitive or confidential information, forming de facto benchmarking partnerships with competitors allows participating institutions to compare cost and output advantages and disadvantages, when performing key processes involved in lending operations. This paper presents an application of technique benchmarking to lending operations across Australia to highlight differences in costs involved in seemingly identical value chains.