WINNING STRATEGIES PART 1 - POLICY DEPLOYMENT Team B3: Paula Urrego-Riveros David Ibagon Lydia Duro-Emanuel Sabrina Tsai Chi-Wen Shih Nazish Leghari
Feb 25, 2016
WINNING STRATEGIES PART 1
- POLICY DEPLOYMENT
Team B3:
Paula Urrego-RiverosDavid IbagonLydia Duro-EmanuelSabrina TsaiChi-Wen ShihNazish Leghari
An Introduction to Hoshin KanriDefined as:
Capability enhancement towards improved performance. Unified policy planning and deployment. Effective employment of resources.
Origins: Originated in Japan in 1950’s. Developed by Bridgestone Tire Company in 1962.
Objectives: Identifies areas of opportunity for the organisation to change or improve. Prioritises the most cost effective actions across the organisation to
achieve these changes. Creates a detailed implementation plan. Provides a review mechanism to identify corrective actions and embed
learning.
Tennant C., and Roberts P. (2001)
Elements of Hoshin Kanri
Elements of Hoshin Kanri
Goals derived
from Vision
Strategy, Policy,
Benchmarking and Target Focus
Established deploymen
t implement
ation process
Feedback Mechanism
s
Must include
TQM
Adapted from: Hutchins D., (2008)
Comparisons of other concepts and Hoshin Kanri
HOSHIN KANRI MANAGEMENT BY
OBJECTIVES
BUSINESS PROCESS
REENGINEERING
BALANCED SCORECARD
VISION Long Term Short term Radical Long Term
FOCUS Process Targets Perform Strategy
IMPLEMENTATION
Prioritize Troubleshoot Make it work Prioritize
MEASURES Realistic Incentives Growth Realistic/daily
REVIEW Improvement Failure Renewal Updated
COMMUNICATION
Deployment of targets Job evaluation Tangible
messagesDeployment of targets
FEEDBACKTop down and bottom-up Top – Down Multiple
channelsOperational and strategic
Table adapted from: Tennant C., Roberts P., (2001) and Whitcher & Chau, 2007, 519
Advantages and Drawbacks of Hoshin Kanri
Focuses on what is important.
Shared vision communicated.
Involves and engages the organisation.
Progress is monitored. Continuous
improvement of the strategic plan.
Enables organisational learning.
Rigid implementation system.
Long-term commitment.
Objectives must be static over a 3-5 year period.
Lack of understanding. Resistance to change.
Advantages of Hoshin Kanri Drawbacks of Hoshin Kanri
12Manage (2011)
Management of Hoshin Kanri Drawbacks
Lack of Understand
ing
Training
Communication
Leadership involvement
and commitment
Resistance to change
Training
Engagement and
empowerment
Robust strategy
Rigid Implement
ation system
Communication.
Training.
Long term Commitme
nt
Leadership commitment
and involvement.
Engagement of
employees.
Continued feedback
and monitoring.
Static objectives
Robust objectives
Manageable and
achievable objectives.
Drawbacks obtained from 12Manage (2011)
The Hoshin Kanri Planning Process
• Organisations’ current situation.
• Determine the future situation.
• Prioritise and Select action.What Needs
to be done?
• Create the plan.
• Improve the vision.
• Deploy the plan. (“Catchball”)
How do we make
changes?• Implement
the plan.• Review the
plan.• Annual
Review.How did we
do?
Adapted from: Cowley M., Domb E., (1997)
Do
CheckAct
Plan
Do
CheckAct
Plan
Do
CheckAct
Plan
Strategic Policy Deployment Overview
Tennant C., and Roberts P. (2001)
…Applying the theory practically.
Implementing Hoshin Kanri at Wave Riders
Creating the Vision - SWOT Analysis
STRENGTHS WEAKNESSES•Top 5 company.•Originated and established in the UK.•Highly experienced workforce.•Multi-design product (Military & Search and Rescue)
•Too much stock.•Overstaffed.•Lack of/Out of date strategy.•Inefficient use of resources (i.e. people, assets e.t.c.)•Impact analysis methods not robust.
OPPORTUNITIES THREATS•Opportunities in UK and European markets.•Increasing demand from leisure markets.•Possibility of repeat business from the military.
•Poor market conditions.•Competition from other key players.•High Stock levels from the previous year.•Declining military demand.
Proposed VisionWave Riders Vision
“In 5 years, Wave riders aims to become a key player in the European markets by focusing our resources, engaging our
employees and satisfying our customers through the production of high quality
products towards excellence.”
Proposed ValuesWave Riders Values: We pride ourselves in satisfying our
customers. We are committed to conduct ourselves in
a manner consistent with the highest standards of integrity.
We are honest, ethical, and fair in all our activities.
We ensure exceptional and reliable quality in all aspects of our work and recognise that quality determines the breath of our success.
The 5 year Strategic PlanProposed Strategic Goals: Increase market share in Europe by
40% in 5 years. 85% customer satisfaction in 5 years. Engagement of employees in 5 years.
Chosen Strategy:
STRATGEY 3
Proposed Strategic Plan
Engagement of employees
Reorganize Finance and HR departments by moving wages and salaries manager into the Finance department.
Increase price of both products by approximately 2.5% (in line with inflation)
Customer Satisfaction
Continue to invest in new technology.
Reorganize the Leisure sales team to three external sales representatives and three internal sales people to handle client follow-up by taking on two new salespeople and take on a European sales representative in the Rescue/Military sales team.
Identify a distributor who could take on the European sales and handle any future expansion of the market
Identify successful European promotional campaigns and put together a winning promotions strategy.
2014/15 2015/16
Increase Market Share in Europe
Research European market pricing structure, discounts, distribution, competition, product and safety
WAVE RADERS
Strategic Goals ACTION PLANS 2011/12 2012/13 2013/14
Operational and Financial Plan
DEPARTMENT
Marketing and Sales
Identify successful European promotional campaigns and put together a winning promotions strategy.
Increase Market Share in Europe
Guarantee Commercial support to UK and Europe &
Decrease Administrative burden
Finances And HR
Production R&D
OBJECTIVES
Entry to European Market
Benchmarking Market in Europe
Remains at the forefront of the Market and meet
Customer expectationsContinue to invest in new
technology.
Reorganize the Leisure sales team to three external sales representatives and three internal sales people to handle Reorganize Finance and HR departments by moving wages and salaries manager into the Finance department.
Strategic Goals ACTIONS PLAN
Research European market pricing structure, discounts, distribution, competition, product and safety specifications etc.
Identify a distributor who could take on the European sales and handle any future expansion of the market
OPERATIONAL PLANFINANCIAL
REQUIREMENTS
£150000 Capital Expanditure £25000 Finance Workload
£250000 Marketing Spend
An Example…
Production R&D
TIME REVIEW
Marketing and Sales
DEPARTMENT
quarters
Marketing indicators
Designs
Increase Market Share in Europe
Entry to European Market
Research European market pricing structure, discounts, distribution, competition, product and safety
Identify a distributor who could take on the European sales and handle any
future expansion of the market
Benchmarking Market in Europe
Identify successful European promotional campaigns and put together a winning promotions
Remains at the forefront of the Market and meet
Customer expectationsContinue to invest in new technology.
Strategic Goals OBJECTIVES ACTIONS PLAN MEASUREMENT
OPERATIONAL PLAN
Policy Deployment Model
Tennant C., Roberts P., (2001)
These plans fit into the overall business plan…
Implementation Process – “Catchball” Hoshin Kanri is
implemented using the “Catchball” process.
Involves communication at all levels of the organisation
Ensures commitment at all levels through the engagement of employees.
Modelled on GE Healthcare’s Catchball Process. GE (2010)
Departmental
Operational/Financial Plan
Wave Riders Strategic
Plan
Wave Riders Operational/Financ
ial PlanWave
Riders Key value
streams
Wave Riders Departmenta
l Plan
Departmental Key
InitiativesEmployee goals and objectives
Programme
Management
Tennant C., & Roberts P., (2001b)
Conclusion Hoshin Kanri is an execution tool to
effectively deploy a strategic plan.
The ‘Catch ball’ process helps eliminate many of the drawbacks of the tool.
TQM is essential to the core concepts of Hoshin Kanri.
Appendix 1 - Selected Strategy 3
Strategy Aim: Increase market share in Europe
Actions and costs Research European market pricing structure, discounts, distribution,
competition, product and safety specifications etc. Identify a distributor who could take on the European sales and handle any future expansion of the market. Need new computerised finance package for Euros and to reduce Finance workload (estimated cost £25,000)
Identify successful European promotional campaigns and put together a winning promotions strategy. Increase marketing spend to £250k.
Increase price of both products by approximately 2.5% (in line with inflation).
Reorganize the Leisure sales team to three external sales representatives and three internal sales people to handle client follow-up by taking on two new salespeople and take on a European sales representative in the Rescue/Military sales team.
Continue to invest in new technology costing an estimated £150k on capital expenditure.
Reorganize Finance and HR departments by moving wages and salaries manager into the Finance department. Reduce the remaining clerical staff in HR to a total of one.
References Witcher B.J., Chau V.S. (2007) Balance Scorecard and Hoshin Kanri:
Dynamic Capabilities For Managing Strategic Fit, Management Decision, Vol: 45, No: 3, pp: 518 – 538, UK, Emerald Group Publishing Ltd.
Witcher B.J., Chau V.S., Harding P. (2007) Top Executive Audits: Strategic Reviews of Operational Activities, Managerial Auditing Journal, Vol: 22, No: 1, pp: 95 – 105, UK, Emerald Group Publishing Ltd.
Tennant C. and Roberts P., (2001) “Hoshin Kanri: A Tool for Strategic Policy Deployment” Knowledge and Process Management, Vol. 8 No. 4, Pages: 262-269
Tennant C. and Roberts P., (2001b) “Hoshin Kanri: Implementing the Catchball Process!. Long Range Planning, Vol 34. Pages: 287-308.
Cowley M., Domb E., (1997) Beyond Strategic Vision: Effective corporate action with Hoshin planning. Boston, Mass: Butterworth-Heinemann.
GE Healthcare (2010) “Leadership Strategy” Obtained from: http://nextlevel.gehealthcare.com/leadership-strategy/its-time-to-stop-dangling-our-feet-in-lean-for-healthcare.php Last updated: 28/10/2010 Last accessed: 12/02/2011.