WINNING STRATEGIES PART 1
- POLICY DEPLOYMENT
Team B3:
Paula Urrego-Riveros
David Ibagon
Lydia Duro-Emanuel
Sabrina Tsai
Chi-Wen Shih
Nazish Leghari
An Introduction to Hoshin Kanri
Defined 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
Goals derived
from Vision
Must include
TQM
Elements
of Hoshin
Kanri
Feedback
Mechanisms
Adapted from: Hutchins D., (2008)
Strategy, Policy,
Benchmarking
and Target
Focus
Established
deployment
implementation
process
Comparisons of other concepts and
Hoshin Kanri
HOSHIN KANRI
MANAGEMENT BY
OBJECTIVES
BUSINESS PROCESS
REENGINEERING
Long Term
Short term
Radical
Long Term
Process
Targets
Perform
Strategy
Prioritize
Troubleshoot
Make it work
Prioritize
MEASURES
Realistic
Incentives
Growth
Realistic/daily
REVIEW
Improvement
Failure
Renewal
Updated
COMMUNICATION
Deployment of
targets
Job evaluation
Tangible messages
Deployment of
targets
Top down and
bottom-up
Top – Down
VISION
FOCUS
IMPLEMENTATION
FEEDBACK
Multiple channels
BALANCED
SCORECARD
Operational and
strategic
Table adapted from: Tennant C., Roberts P., (2001) and Whitcher & Chau, 2007, 519
Advantages and Drawbacks of
Hoshin Kanri
Advantages of Hoshin Kanri

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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.
12Manage (2011)
Drawbacks of Hoshin Kanri

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Rigid implementation system.
Long-term commitment.
Objectives must be static
over a 3-5 year period.
Lack of understanding.
Resistance to change.
Management of Hoshin Kanri
Drawbacks
Lack of
Understanding
Resistance to
change
Training
Training
Rigid
Implementation
system
Communication.
Communication
Leadership
involvement and
commitment
Engagement and
empowerment
Long term
Commitment
Leadership
commitment and
involvement.
Static
objectives
Robust objectives
Engagement of
employees.
Training.
Robust strategy
Drawbacks obtained from 12Manage (2011)
Continued
feedback and
monitoring.
Manageable and
achievable
objectives.
The Hoshin Kanri Planning Process
Plan
Do
Plan
Do
Act
Check
Act
Check
• Organisations’
current situation.
• Determine the future
situation.
• Prioritise and Select
action.
What Needs to
be done?
How do we
make changes?
• Create the plan.
• Improve the vision.
• Deploy the plan.
(“Catchball”)
Adapted from: Cowley M., Domb E., (1997)
• Implement the
plan.
• Review the plan.
• Annual Review.
How did we
do?
Plan
Do
Act
Check
Strategic Policy Deployment
Overview
Tennant C., and Roberts P. (2001)
Implementing Hoshin Kanri at Wave Riders
…Applying the theory practically.
Creating the Vision - SWOT Analysis
STRENGTHS
•Top 5 company.
•Originated and established in the UK.
•Highly experienced workforce.
•Multi-design product (Military & Search
and Rescue)
OPPORTUNITIES
•Opportunities in UK and European
markets.
•Increasing demand from leisure markets.
•Possibility of repeat business from the
military.
WEAKNESSES
•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.
THREATS
•Poor market conditions.
•Competition from other key players.
•High Stock levels from the previous year.
•Declining military demand.
Proposed Vision
Wave 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 Values
Wave Riders Values:
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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 Plan
Proposed Strategic Goals:
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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
WAVE RADERS
Strategic Goals
ACTION PLANS
Research European market pricing
structure, discounts, distribution,
competition, product and safety
Increase Market Share in
Europe
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.
Continue to invest in new technology.
Customer Satisfaction
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.
Reorganize Finance and HR departments
by moving wages and salaries manager
into the Finance department.
Engagement of employees
Increase price of both products by
approximately 2.5% (in line with
inflation)
2011/12
2012/13
2013/14
2014/15
2015/16
Operational and Financial Plan
OPERATIONAL PLAN
Strategic Goals
OBJECTIVES
Entry to European Market
ACTIONS PLAN
Research European market pricing
structure, discounts, distribution,
competition, product and safety
specifications etc.
DEPARTMENT
FINANCIAL
REQUIREMENTS
Marketing and
Sales
£250000 Marketing Spend
Identify a distributor who could take
on the European sales and handle
any future expansion of the market
Increase Market Share in
Europe
Benchmarking Market in
Europe
Remains at the forefront of
the Market and meet
Customer expectations
Guarantee Commercial
support to UK and Europe &
Decrease Administrative
burden
Identify successful European
promotional campaigns and put
together a winning promotions
strategy.
Continue 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.
Production R&D
£150000 Capital Expanditure
£25000 Finance Workload
Finances And HR
An Example…
OPERATIONAL PLAN
Strategic Goals
Increase Market Share
in Europe
OBJECTIVES
ACTIONS PLAN
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
Remains at the forefront of
the Market and meet
Customer expectations
DEPARTMENT MEASUREMENT
Marketing and
Sales
Marketing indicators
quarters
Identify successful European
promotional campaigns and put
together a winning promotions
Continue to invest in new technology.
TIME REVIEW
Production R&D
Designs
Policy Deployment Model
These plans fit into the overall business plan…
Tennant C., Roberts P., (2001)
Implementation Process – “Catchball”
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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.
Tennant C., & Roberts P., (2001b)
Wave Riders
Strategic Plan
Wave Riders
Departmental
Plan
Departmental
Operational/Fin
ancial Plan
Wave Riders
Operational/Financial
Plan
Wave Riders
Key value
streams
Programme
Management
Departmental
Key Initiatives
Employee goals
and objectives
Modelled on GE Healthcare’s Catchball Process. GE (2010)
Conclusion
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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
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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
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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-ourfeet-in-lean-for-healthcare.php
Last updated: 28/10/2010 Last accessed: 12/02/2011.