An approach to improving logistical performance with cross‐unit benchmarking

Purpose – The paper aims to help identify the best logistical practices and to implement them with minimal organizational resistance in an environment with relatively similar business units utilizing an internal benchmarking approach. Design/methodology/approach – A stepwise benchmarking process, where the use of basic inventory control practices is complemented with benchmarking analysis among business units that are of the same kind, but not entirely similar. The viewpoint is that of a supply chain specialist, and the main objective of the paper is to present how the analysis should be carried out. Findings – Four principles were found useful when carrying out the analysis for internal benchmarking: refining stepwise the precision of the analysis, accepting the practical limitations of the data, disaggregating the task to be benchmarked to manageable sub‐areas, and engaging the management and key implementers in the analysis work. Originality/value – The approach is a complementary approach to the traditional inventory models, which often rely on more or less arbitrary parameter values. The analysis provides realistic, individual inventory objectives and gives suggestions for focused improvement actions.