A critique of benchmarking and performance measurement Lead or lag? Karen Anderson and Rodney McAdam School of Business Organization and Management, University of Ulster, Jordanstown Campus, Belfast, UK Keywords Benchmarking, Performance measurement (quality), Predictive process Abstract This paper succinctly critiques the benchmarking literature and the performance measurement literature in regards to the novel concept of lead benchmarking as a possible means of achieving increased radical and innovative transformation in organizations. For the purposes of the paper, a working definition of lead benchmarking and performance measurement is: benchmarking and performance measurement, which focuses on analysing forward looking, predictive and future performance comparisons. This critique distinctly highlights that the currency of benchmarking and performance measurement needs a radical and indeed innovative transformation to adhere to the dynamics of the business environment. This critique raises various questions of interest. These issues will be investigated later through further research by conducting rich empirical research, whereby descriptions and explanations will be developed of the what, where, who, how and why of the benchmarking concept and the extent to which organizations carry out lead benchmarking Introduction The business environment has evolved dramatically over the past four decades, which has caused almost every aspect of organizations and management to change accordingly. Atkinson and Brown (2001), Corrigan (1998), Lockamy (1998) and Neely (1998) have outlined similar elements which have caused and indeed contributed to the changes in the business environment. These include the changing nature of work, increased competition, specific improvement initiatives, national and international quality awards, changing internal and external demands (stakeholders), accelerated technological advancement, changing organizational roles and the acceleration of globalisation. During this time period, myriads of business improvement philosophies, approaches and methodologies have been continuously developed. This development has been based on various combinations of business practices and academic theory (McAdam and McCreedy, 1999). These approaches include organizational learning (March and Argyris, 1977), the learning organization (Senge, 1990), supply chain management, total quality management (Deming, 1982), business process re-engineering (Hammer and Champy, 1993), benchmarking (Xerox, 1979), balanced scorecard (Kaplan and Norton, 1992), European Foundation for Quality Management (EFQM) Business Excellence Model (EFQM, 1991), six sigma and knowledge management (Nonaka and Takeuchi, 1995). Although these practices and theories endure a certain element of benchmarking, they tend to involve mainly lag or production measures with very little emphasis on lead measures. Notwithstanding the fact that the balanced scorecard and the EFQM The Emerald Research Register for this journal is available at The current issue and full text archive of this journal is available at www.emeraldinsight.com/researchregister www.emeraldinsight.com/1463-5771.htm Benchmarking and performance measurement 465 Benchmarking: An International Journal Vol. 11 No. 5, 2004 pp. 465-483 q Emerald Group Publishing Limited 1463-5771 DOI 10.1108/14635770410557708