Performance measures and benchmarking in business innovation

Citation

Gunasekaran, A. and Steven White, D. (2009), "Performance measures and benchmarking in business innovation", Benchmarking: An International Journal, Vol. 16 No. 3. https://doi.org/10.1108/bij.2009.13116caa.001

Performance measures and benchmarking in business innovation

Article Type: Guest editorial From: Benchmarking: An International Journal, Volume 16, Issue 3

Welcome to this special issue of Benchmarking: An International Journal (BIJ). The articles included in this issue represent the state-of-the-art in the development and application of performance measures and benchmarking in business innovation. The catalyst for generating the articles was the first Global Business Innovation and Development (GBID) Conference held in Rio de Janeiro, Brazil in January 2008. Innovative in its own right, this conference brought together scholars from every continent and multiple academic disciplines including accounting, engineering, finance, information systems, law, management, marketing, operations, and supply chain management to discuss the relationship between innovation and business development and to present best practices in business innovation to a broader audience.

All of the articles contained in this issue have been through a rigorous review process at both the conference level (three blind reviewers per paper) and the journal submission level (three blind reviewers per paper). Thus, it is with a debt of gratitude that we acknowledge the service of the 48+ reviewers who gave so freely of their time and expertise to make this an exceptionally poignant and timely publication.

The importance of benchmarking in the innovation process is receiving increased attention in the literature. The relationship between benchmarking and innovation was not well-established in the past and the evidence of a positive impact anecdotal until recently (Massa and Testa, 2004). According to Cooper and Kleinschmidt (2007), benchmarking has the potential to bridge the gap between innovation and performance by serving as the foundation on which to build solutions to problems. Likewise, Pecas and Henriques (2006) provide evidence of the importance of diffusion of benchmarking and best practices from academia to industry. Finally, Rodriguez and Marti (2006) describe the potential impact that benchmarking innovation (including intellectual capital) has on stimulating regional economic growth. It is in the spirit of the aforementioned research that the following articles are presented.

In the first article, Henrik Agndal (marketing) and Fredrik Nordin (management and engineering) investigate the non-financial consequences of outsourcing. When innovative firms engage in outsourcing, they risk losing core competencies that in the past have led to competitive advantages in the marketplace. The authors develop a model for the study of the non-financial consequences of outsourcing. After developing the initial theoretical model incorporating the outsourcing of research and development, purchasing, marketing and sales and customer service, the authors conducted focus-group interviews with senior executives with experience in purchasing and outsourcing. Based on the results of the qualitative research, a revised model is presented.

Next, Annibal Parracho Sant’Anna (operations management) and Rodrigo Otavio de Araujo Ribeiro (marketing) present a compelling argument to consider the use of stochastic modeling in the prediction of customer lifetime value. In utilizing a stochastic approach, the results of two parallel prediction models and information regarding the contribution margin per customer provides a increasingly accurate prediction of customer lifetime value, a critical variable in the development and implementation of customer relation management systems.

Much has been written about the importance of in-bound tourism to a region’s economy, but little research exists on the residents’ involvement in tourism activities and their perceptions of tourism impacts. Bishnu Sharma (management) and Pam Dyer (arts and social sciences) address this oversight in the third article in this special issue. The diffusion of the economic benefits of in-bound tourism are found to be less widespread than expected and are not always positive. The results of this study provide a foundation on which to build benchmarking research in the hospitality and tourism industries.

In the fourth article, Fotini Patsioura (applied informatics), Maro Vlachopoulou (applied informatics) and Vicky Manthou (applied informatics) develop a new advertising effectiveness model for measuring the impact of corporate advertising web sites. The focus of this research is on building long-term relationships by providing the web site content desired in a preferred format that meets the needs of the customers. Effectiveness measures provide feedback regarding actual customer behavior in the use of functions and features incorporated in corporate web sites and thus allow the developers of these sites to better tailor them to meet customer preferences, desires and/or needs.

Product variety in the automotive industry is the topic of the fifth article in this issue. Luiz Felipe Scavarda (engineering), Jens Schaffer (automation technology), Annibal José Scavarda (operations management), Augusto da Cunha Reis (industrial engineering) and Heinrich Schleich (automotive technology) conducted an empirical multi-market exploratory analysis to investigate perceived differences in product variety globally despite the standardization of automotive platforms. The results suggest that product variety categories (four identified) tend to be restricted in emerging markets. Through benchmarking, the authors show that automobiles manufactured in and for the European market tend to exceed the appropriate level of variety expected in the marketplace. Based on the findings, opportunities for improvement exist in the product variety supply chain for all markets investigated.

Monika Koller (marketing) and Thomas Salzberger (marketing management) use a longitudinal mixed-method approach to collect customer-focused information to be used by service companies for benchmarking purposes. The authors utilize both qualitative and quantitative methods to provide insight into the consumers’ psychological state during the decision-making process. The in-depth information obtained by incorporating the mixed-method approach provides unique and valuable input on which to build the application and use of benchmarking in service industries. Furthermore, the benefits of using a longitudinal approach over a cross-sectional approach are presented.

In “Benchmarking Russian and Finnish food industry supply chains,” Tommi Tuominen (production), Natalia Kitaygorodskaya (production) and Petri Helo (production) benchmark the Russian food production supply chain against the Finnish food production supply chain. Differences are investigated using a case study methodology and through the application of the supply chain management scorecard. Despite being designated as a G8 economy, little is known about the Russian food production industry and its evolution since 1989. Results indicate that differences between the two supply chains can be explained by the differences in the operating environments and the level of technology used in the industry in each country.

The final paper in this special issue is from Kingsley Opoku Appiah (accounting) and Joshua Abor (finance). The authors develop a model for predicting corporate failure using multiple discriminant analysis. Their findings suggest that net profit margin is superior to gross profit margin in discriminating between failed and non-failed companies. The research contributes to the area of benchmarking by providing a method to more accurately predict corporate failure.

It was a pleasure to work with the organizing committee for the GBID Conference 2008 including the American Marketing Association Global Marketing Special Interest Group, COPPE – Universidade Federal do Rio de Janeiro and Fundação Getulio Vargas to put together a global forum that yielded such excellent research. To each participating partner, we offer a heartfelt thank you, especially to Dr Godwin Ariguzo for his efforts above and beyond. In addition, thank you to the 31 members of the international scientific committee for your service and support. Finally, thank you to the researchers and participants for making the conference an overwhelming success.

The articles contained in this special issue are representative of the interdisciplinary nature and spirit of the conference. We appreciate the willingness of the authors to participate in this special issue on performance measures and benchmarking in business innovation. In essence and in practice, they have become innovators themselves.

Finally, many thanks and appreciation goes to Dr John Peters (President and Chief Executive Officer of Emerald Group Publishing Ltd) and Ms Lucy Sootheran (publisher of BIJ) for their continued support to BIJ.

Angappa Gunasekaran, D. Steven WhiteGuest Editors