Benchmarking has been widely recognized as an important tool of total quality management. Benchmarking has been also practised for a long time by different firms in different ways, such as in the implementation of technological systems like CAD/CAM, flexible manufacturing systems (FMS), and automobile manufacturing. AT&T and Xerox were some of the pioneer companies in benchmarking, they even developed their own benchmarking approaches. Benchmarking is a process of continuously measuring and comparing the company's performance level against the performance level of leading companies to determine the proper practices and actions that the company should implement to improve its performance. In this research, a generic framework for a metric that measures the overall effectiveness of the benchmarking process is laid out. In addition, a framework of a mathematical model for the optimal resource allocation of the benchmarking process is developed and its application is illustrated by an example. The above mentioned approaches constitute important tools for companies seeking to improve their competitiveness through benchmarking.