Benchmarking is the process of comparing a company's performance metrics to industry standards or best practices. This helps organizations identify areas for improvement and set realistic goals. By analyzing data from similar businesses, companies can understand their strengths and weaknesses relative to competitors. There are different types of benchmarking, including internal benchmarking, which compares performance within the same organization, and external benchmarking, which looks at competitors or industry leaders. This practice is essential for continuous improvement and can lead to enhanced efficiency, productivity, and overall success in achieving business objectives.