Out of recession? Where next? Hoshin Kanri ‘Making strategy AND making it happen’

1. Out of recession? Where next? Hoshin Kanri ‘Making strategy AND making it happen’

2. Typical Hoshin strategy - About becoming and remaining the Best of the Best!

3. Typical well known users :- Toyota, Honda, Hewlett Packard, Philips, Komatsu, Bombardier Shorts, Canon, JVC, Mitsubishi, Sony. Less well known in the West but equally effective Mobarakeh Steel Iran

4. Underlying belief Each person is the expert in his or her own job

5. Underlying philosophy To harness the creativity, skills, knowledge of all the people in our organisation to make us the best in our field

6. Close your eyes Imagine it is 5 years on from now A reporter from the ECONOMIST Has been allowed to visit your company, To talk to everyone that he wants and to see everything.

7. Close your eyes A few weeks later, you have the centre spread What would you want the headline to say? Read down the column inches, what would you want them to say?

8. What might they say if the reporter went there now? How big is the gap between where you are and where you would like to be? Challenge? How can we get from here to there?

9. Global High Performer using Hoshin Kanri Typical organisation Management by process - High performance process output Management by function - Low performance process output Does your image look like this?--------------- or like this?

10. Process based management Whose fault was it! it is a terrible waste of energy Functional management – Departmental goals more important than corporate goals – when things go wrong blame the other departments – Hoshin management - Corporate goals ARE Departmental goals – If things go wrong – find what is wrong with the process – attack problems not people!

11. ‘Value’ Chain Interconnections Multiple interacting suppliers and sub supplier processes each comprising – people, methods, materials, equipment, environmental variation and measurements makes for a complex system Each contributes to the VISION and has its specific KPIs integrated into the Corporate whole Key Business Processes

12. Olympic hero Chris Hoy knighted as sport stars grab honours Do we want to look like this?------------------- or this?

13. David Brailsford Olympic team coach said: "Everybody in our team dedicate their lives to the pursuit of a dream - to win a gold medal. When they do get recognised in this way it is a fantastic honour.”

14. David Brailsford also said: “It was by attention to detail that gave us the advantage over the other teams. We considered everything even the smallest improvements that would give us a competitive edge. It was the accumulation of these small details that made us unbeatable.

15. in Toyota from a labour force of 40000 people they have over 2,600,000 improvement suggestions per year of which 96% are implemented! Quality Circle at work in Kraft Foods Venezuela December 2008

16. Establish Vision and Mission, Set Corporate goals and targets - agree overall programme, monitor and support. Agree and establish departmental goals, participate in project teams, support Quality Circles. Agree and establish section goals, participate in continuous improvement activities through Quality Circles.

17. Set the goal from Benchmarking • Successful presence in global and domestic markets as a leading organisation in quality, technology, production and sustainable development World class performers Business Performance Do not target where they are now, target for where they will be in 3/5 years time. Our Company NOW 3/5 years

18. Problem Composition: 1987 and 1994(Industry Average Problems Per 100 Cars) 166 Water Leaks 6 Steering and Handling 6 Temperature Control 7 This should have been the 2005 target Brakes 8 Transmission 9 Wind Noise 11 110 Body 16 4 5 6 Interior 17 5 5 8 Exterior Paint & Moldings 17 2005? 14 Squeaks & Rattles 18 11 12 2010? Engine 24 12 9 Electrical & Accessories 28 19 1987 1994

19. Hoshin Implementation Outline Plan November onwards October/November Customers Steering Group meeting • “as is” • Analysis • Process • Map • B/mark best in class • Agree target perf’mnce • Identify • Improvement opp’s Employees Set up project office and facilities Suppliers • Prioritiseopportunities • Establish KPIs (use QFD) • Plan for roll out and deployment • Monitor Cost/ benefits • Implement • Review • Update • PDCA Organisation Identify key resources Design and innovation etc Plan Steering Group meetings Technology Processes Brief and train combined teams Finance etc Develop communication plan Project Support Communication Brief managers Change/program mgt Mobilisation Plan. Analyse. Develop, implement

20. Typical example of KPI analysis under development

21. MISSION CURRENT BENCHMARK ELEMENT SITUATION SOURCE KNOWLEDGE SKILLS DEVELOP THE KNOWLEDGE, CREATIVITY SKILLS & CREATIVITY OF OUR TEAM TO GENERATE INVOLVEMENT AND PRIDE INVOLVEMENT AS WE CONTINUALLY IMPROVE OUR BUSINESS. PRIDE BUSINESS IMPROVEMENT DHi David Hutchins Consulting Group Tree diagram format - Key Performance Indicators DRIVERS MEASURE TARGET WORLD-CLASS COMPANIES SKILL TESTING UNIVERSITIES AND COLLEGES EDUCATION PROGRAMMES WORLD-CLASS COMPANIES STAFF APPRAISAL WORLD-CLASS COMPANIES MULTI-SKILLING WORLD-CLASS COMPANIES TRAINING BUDGET COURSES UNIVERSITIES AND COLLEGES WORLD-CLASS COMPANIES SUGGESTIONS WORLD-CLASS COMPANIES PROJECTS WORLD-CLASS COMPANIES INNOVATION WORLD-CLASS COMPANIES TEAM WORK PRESENTATIONS WORLD-CLASS COMPANIES SELF-IMPROVEMENT WORLD-CLASS COMPANIES ABSENTEEISM LOCAL COMPANIES LOCAL COMPANIES SICKNESS LOCAL COMPANIES DISPUTES LOCAL COMPANIES LABOUR TURNOVER WORLD-CLASS COMPANIES RESPONSE TO JOB ADVERTS WORLD-CLASS COMPANIES PERFORMANCE IMPROVEMENT WORLD-CLASS COMPANIES/ SCRAP REDUCTION IMPROVED DELIVERY WORLD-CLASS COMPANIES/ TRADE ASSOCIATIONS CUSTOMER COMPLAINTS WORLD-CLASS COMPANIES SAFETY - LOST-TIME ACCIDENTS AND ROSPA ETC DOPRES5 PAPER1

22. Hoshin Planning Can be transferred to Staff objectives ‘CUSTOMER RELATED MANAGEMENT’ HOUSE OF QUALITY To improve customer loyalty Correlation matrix Function/department/ process Central Matrix (Relationships) Current performance Target performance From tree Diagram Actions

23. . . . . . . . . . Departments in Company orfunctions in own department Customer TrumptonHospital Ratio between expected and achieved Actual level achieved by Mobarakeh Planning and production control Level of customer expectation Previous established criteria Importance of the parameter Engineering services Customer support Transportation Performance & In-process Production Packaging Accounts Sales Measures Promises kept 5 85% 35% 0.41 On time delivery Product application 2 100% 70% 0.70 Provision of Technical Services No of days 4 80% 100% 1.25 Prompt handling of complaints The product standard 5 100% 55% 0.55 Good quality (Physical Characteristics) Market price band 4 100% 90% 0.90 Suitable Price No of meetings 2 50% 50% 1.00 Effective communication Oncology Department ……………………………………Date……………….………. Name…………………………..Signature……………..…………….Position…………………… Endorsed by (Name)…………………….Signature…………………………...Position…………………… No of consultation hrs 2 2 100% 100% 100% 100% 1.00 1.00 Provision of consultation Supervisor Hassan G Hassan G Packaging standard 4 4 100% 100% 85% 85% 0.85 0.85 Packaging Financial crediting 5 5 100% 100% 80% 80% 0.80 0.80 Customer focus Provision of credit Mission Element. ……………………………………………….….. ………………………………………………………………….…… KPI Measure Current Target Planned completion Performance Performance Kept promises Deliveries 85% 100% Surfacedefects No of rejects 0% 4% Skills training

24. Projects Projects Projects Projects Policy Deployment – Driving towards Global Excellence Hoshin Kanri POLICY DEVELOPMENT EXECUTIVE AUDIT P VISION A ANNUAL REVIEW MISSION POLICY CONTROL HALF-YEARLY REVIEW WEEKLY RESULT DAILY RETURNS RECOGNITION & REWARD POWER HOUSE OF TOTAL QUALITY Critical Success Factors Policies Annual Goals EXECUTIVES C POLICY DISSEMINATION using Balanced Scorecards DIVISIONAL HEADS SECTION HEADS D EMPLOYEES Quality Circles Suggestion Schemes

25. Staff objectives (Achieving KPI targets) IMPROVEMENT Vision Management Review against Score Cards Mission Staff Objectives Key Performance Indicators Policies Goals Divisional Heads Policy Staff Objectives Section Heads Policy Staff Objectives Self Directing Work Groups Policy Staff Objectives DCHLINE\REV 1

26. Vision Management Review against Score Cards Mission Key Performance Indicators Policies Goals Divisional Heads Policy Section Heads Policy Self Directing Work Groups Policy Multiple story boards for visible management) IMPROVEMENT Projects selected from Staff Objectives Daily Performance against Staff Objectives Story Boards DCHLINE\REV 1

27. 8 features of Global High Performance Global High Performer Vector sum of energy • Top management involvement – not just commitment. • Clear ‘Vision’ from the top and clear policies for all business ‘drivers’. • ‘Key Performance Indicators’ (KPI’s). • ‘Benchmarking’ against competitors and ‘best in class processes. Look after the process and the product looks after itself! • ‘Champions’ nominated for major initiatives. Deployment of goals to all levels • Continuous Improvement at all levels + Lean Six Sigma • Self Directing Workplace improvement teams. • Attack problems not people. High ‘Corporate IQ’