Influenced by the NATO 2020 strategy review and the Ukraine crisis, the Allies decided to reemphasize the two percent guideline of their gross domestic product (GDP) within a decade in order to reverse the trend of declining military spending and to meet the current security. However, spending two percent of the GDP for military purpose does not automatically create a higher readiness and performance of a country's armed forces. Such a simple comparison of input-variables does not provide any resilient results in terms of efficient and effective measurement regarding forces contribution, nor does it contribute to the measurement of performance and effectiveness in terms of force preparation by the member states. Based on NATO's objective of collective defense, this thesis will discuss a potential benchmarking concept for NATO - beyond the two percent GDP guideline - to create a performance-orientated measurement of member states in meeting the Alliance's Strategy of Collective Defense and Deterrence. In the context of this research, this thesis will identify a possible financial value of NATO's military means, which are provided by its member states in accordance with the criteria of readiness. Consequentially, the developed benchmarking system could be the most important as well as fairest instrument in NATO's toolbox for controlling and for measuring the performance of modern armed forces.

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