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Hoshin Kanri

Hoshin Kanri. Figure 1: The Core Hoshin Planning Process (Source: GOAL/QPC 1989, p. 13). (1) Establish organization vision. PHASE 1: (1)(2) – Well done strategic planning. (2) Develop 3-5 year plan. PHASE 2: (3)to(7) – Heart of hoshin planning process. (3) Develop annual objectives.

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Hoshin Kanri

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  1. Hoshin Kanri

  2. Figure 1: The Core Hoshin Planning Process (Source: GOAL/QPC 1989, p. 13) (1) Establish organization vision PHASE 1: (1)(2) – Well done strategic planning (2) Develop 3-5 year plan PHASE 2: (3)to(7) – Heart of hoshin planning process (3) Develop annual objectives (4) Deployment/roll down to depts., to develop plans including targets and means (5) Implementation Act Plan Check Do (6) Regular progress review – monthly + quarterly (7) Annual review

  3. What is different? • Everybody company-wide/build strategy into daily management • Distinction between breakthrough/continuous improvement • Greater involvement of leadership (hierarchy of PDCAs) • Bottom-up catchball planning (preparing the ground/consensual – for faster implementation) • The management philosophies & business methodologies of total quality management & lean working • Management by PDCA • The Pareto principle • Business process management/quality tools • Management of Objectives, rather Management by Objectives (emphasis on process and review) • Objectives and means always considered together • Common language of cross-functional objectives (e.g. Quality, Cost, Delivery, & People) used by everyone

  4. FIGURE 2.1 Three dimensions of organizational purpose

  5. The annual FAIR cycle: it is managed by using PDCA

  6. Nissan’s Top Executive Audit (Dynamic Capability) Core Areas/Processes Core Competences Daily control The determination of hoshins The coordination of hoshin development & deployment The establishment of control items Analytical & problem-solving abilities Check & action taken Leadership & participation by high-ranking personnel • Cross-functional activities • Daily management • Production maintenance • Standardization establishment • Productivity improvement activity • Inspection • Production control & labour management • Personnel & labour management • Cost management • Quality control • Engineering capability • Parts localization • Purchasing

  7. Styles of Capitalism Liberal market economy Coordinated market economy Collaborative institutional relations Strategic resources are industry, firm specific (resource based view of strategy) Strategic management primarily inside-out & synergy based, common corporate ways of working Longer-term • Resources coordinated through markets • Strategic resources are adaptable & general (market based view of strategy) • Strategic management primarily outside-in & portfolio based, importance of SBU • Shorter-term Is the very large MNC a special case, and what have been the effects of global strategy?

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