Performance benchmarking is applied in two different contexts. It can be applied to benchmarking the product or offerings of the company against competitors and alternatives. It could also be done internally within product families or product variants. It compares all parameters influencing the man, machine, and material. It also includes factors, the method and money involved in making and taking the product to market.
When applied at the business level, it involves comparing business performance indicators with industry standards and competitors. Depending on the findings, performance benchmarking helps to identify areas of excellence or areas of concern, which in turn define priorities for initiatives and investments.