Selecting Benchmarking Partners Using Analytical Hierarchy Process Approach

Abstract

Benchmarking is a method to improve performance and improve company competitiveness. This
method has been commonly practiced by large companies and has recently been extended to
small and medium enterprises (SMEs). However, the implementation between large and SMEs
is very different. These differences are debated as an impact of company characteristics,
specifically differences in the ability to develop and improve business. Typical SMEs face tough
challenges to overcome their resource constraints. This limitation affects the decisions of SMEs
in choosing their comparison partners. This research was conducted to fill the research gap
regarding the use of the Benchmarking method and the AHP approach to SMEs, especially in
determining Benchmark partners using the AHP approach. The use of benchmarking and AHP
is illustrated by using SME objects that are engaged in the fashion sector, namely UKM
Cotton.Go. The problem faced by UKM Cotton.Go is marketing communication that is not
effective in creating sales so it needs to be determined benchmarking partner in making
improvements to marketing communication. The use of AHP in determining benchmark partners
helps SMEs to find out which benchmark partners have the best marketing communication
performance.