Final answer:
The process described is benchmarking, which involves measuring system results and comparing them to optimal system performance to improve efficiency and effectiveness within an organization.
Step-by-step explanation:
The process described in the question refers to benchmarking, which is a method of continuously measuring system results, comparing those results with optimal system performance, and then identifying steps and procedures to improve system performance. Benchmarking can be applied to various areas within an organization, including but not limited to efficiency, effectiveness, and productivity. This practice is essential for organizations seeking to maintain competitive advantage and deliver the best possible service or product.
The process often encompasses employing metrics to gauge the efficiency and effectiveness of different operations within the company. Efficiency metrics evaluate how well the company uses its resources to maximize output, whereas effectiveness metrics examine the degree to which desired outcomes are achieved. The combination of these metrics provides a comprehensive understanding of an organization's performance relative to its goals and industry standards.
For instance, companies might measure the costs involved in production (marginal costs) against the benefits derived from selling additional units (marginal benefits). This cost/benefit analysis helps in making informed decisions to enhance organizational efficiency and performance. Comparing measurements and results is key to the benchmarking process and for establishing the metrics that an organization will use to measure progress toward achievement of its goals.