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# One way to judge the performance of a company is to compare

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Manager
Joined: 06 Jul 2005
Posts: 114
Location: Bangalore, India
One way to judge the performance of a company is to compare [#permalink]

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30 Oct 2005, 05:44
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Edit: This discussion has retired. Find the new thread HERE

One way to judge the performance of a company is to compare it with other companies. This technique, commonly called "benchmarking", permits the manager of a company to discover better industrial practices and can provide a justification for the adoption of good practices.

Any of the following, if true, is a valid reason for benchmarking the performance of a company against companies with which it is not in competition rather that against competitors EXCEPT:

(A) Comparisons with competitors are most likely to fous on practices that the manager making the comparisions already employs
(B) Getting "inside" information about the unique practices of competitors is particularly difficult
(C) Since companies that compete with each other are likely to have cpmparable levels of efficiency, only benchmarking against noncompetitors is likely to reveal practices that would aid in beating competitors
(D) Managers are generally more receptive to new ideas that they find outside their own industry
(E) Much of the success of good companies is due to their adoption of practices that take advantage of the special circumstances of their products of markets
Intern
Joined: 29 May 2015
Posts: 12
Re: One way to judge the performance of a company is to compare [#permalink]

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07 Nov 2016, 00:18
One way to judge the performance of a company is to compare it with other companies. This technique, commonly called "benchmarking", permits the manager of a company to discover better industrial practices and can provide a justification for the adoption of good practices.

Any of the following, if true, is a valid reason for benchmarking the performance of a company against companies with which it is not in competition rather that against competitors EXCEPT:

(A) Comparisons with competitors are most likely to fous on practices that the manager making the comparisions already employs
(B) Getting "inside" information about the unique practices of competitors is particularly difficult
(C) Since companies that compete with each other are likely to have cpmparable levels of efficiency, only benchmarking against noncompetitors is likely to reveal practices that would aid in beating competitors
(D) Managers are generally more receptive to new ideas that they find outside their own industry
(E) Much of the success of good companies is due to their adoption of practices that take advantage of the special circumstances of their products of markets

I think the difficulty of the question comes from the question stem, at least for me.
The simple version is 'one of the choises will not be a good reason for benchmarking non competition companies. Choose'

A. will be a good reason to benchmark non competiton companies. So this is out.
B. Again, good reason to benchmark non competition comp.
C. Same as above.
D. Same as above.
E. This is it. Not about benchmarking non competition companies.

Hope this helps.
Intern
Joined: 16 Oct 2016
Posts: 3
Re: One way to judge the performance of a company is to compare [#permalink]

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12 Nov 2016, 00:33
gamjatang wrote:
(A) says that it is of no use to benchmark competitors.

(B) says that it is very difficult to benchmark competitors.

(C) says that it is of no use to benchmark competitors.

(D) says that it is of little use to benchmark competitors.

(E) says that much of the success comes from the adoption of good practices of the same industry(=special circumstances of their products of markets)

I vote for (E).

the option `E` does not say same industry, IT can be non competitor.
Intern
Joined: 07 Dec 2016
Posts: 11
Re: One way to judge the performance of a company is to compare [#permalink]

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07 Mar 2017, 07:15
Initially marked D option but later after the official answer realised the "real" meaning of question. The Qs is asking us the need for using the benchmark i.e. why should we use the benchmark and why its important for the company against its competitor.

Option E certainly elaborates the need of benchmarking as to take advantage of the product and market scenario in a way to make their product competitive in the market.
Senior Manager
Joined: 29 Jun 2017
Posts: 499
GPA: 4
WE: Engineering (Transportation)
Re: One way to judge the performance of a company is to compare [#permalink]

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14 Aug 2017, 05:56

We do not have to look for 4 answer choice which says ( no comparision with competitors and comparing with non competitors)
we have to select remaining one.

A) It says comparison with competitors has no benefit as managers already employ practices. so no need to compare with competitor , OUT
B) Getting inside info is difficult , OUT
C) It favours Benchmarking with Non competitors - OUT
D) Managers are generally open to new ideas outside their industry, OUT
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Joined: 28 Mar 2017
Posts: 1021
Location: India
Concentration: Finance, Technology
GMAT 1: 730 Q49 V41
GPA: 4
Re: One way to judge the performance of a company is to compare [#permalink]

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19 Aug 2017, 14:02
One way to judge the performance of a company is to compare it with other companies. This technique, commonly called "benchmarking", permits the manager of a company to discover better industrial practices and can provide a justification for the adoption of good practices.

Any of the following, if true, is a valid reason for benchmarking the performance of a company against companies with which it is not in competition rather that against competitors EXCEPT:

(A) Comparisons with competitors are most likely to fous on practices that the manager making the comparisions already employs -If the practices being compared are already employed, then the manager won't get any new insight. Thus, comparison with non competitor will be more beneficial.
(B) Getting "inside" information about the unique practices of competitors is particularly difficult -If getting the inside information of the competitor is difficult, then valid comparisons can't be made. Thus, comparison with non competitor will be more beneficial.
(C) Since companies that compete with each other are likely to have cpmparable levels of efficiency, only benchmarking against noncompetitors is likely to reveal practices that would aid in beating competitors -This is a direct strengthener.
(D) Managers are generally more receptive to new ideas that they find outside their own industry -If the managers are receptive of new ideas, then going through the strategies employed by non competitors will be fruitful. Thus, comparison with non competitor will be more beneficial.
(E) Much of the success of good companies is due to their adoption of practices that take advantage of the special circumstances of their products of markets -This is option says that the manager takes advantage of the product present in the market. It is out of context.
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Re: One way to judge the performance of a company is to compare   [#permalink] 19 Aug 2017, 14:02

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# One way to judge the performance of a company is to compare

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