Transcript BA 550 3 Structured Planning.ppt
ORGANIZATION MANAGEMENT
Structured Planning / Hoshin Planning
Does your organization:
Have a beautiful strategic plan collecting dust
Keep trotting out the same plan year after year having made little or no progress
Have improvement projects working in twenty different directions
Seem unable to make progress on strategic objectives because real work gets in the way
Have a plan but never checks on progress or holds people accountable
Manage by opinion rather than fact
Have a great plan but nobody knows about it
Hoshin Planning
The Hoshin planning process is a systematic approach to identify, sort and resolve issues requiring breakthrough improvement
Business Fundamentals
Key processes that are used to manage the overall business and day-to-day activities
Sales forecasting
Supplier management
Production planning
Employee development
Customer complaint resolution
Breakthrough Improvement
Reduce product failure rate 10X
Win the Malcolm Baldridge award
Achieve 25% market share in < $100 products
Reduce new product introduction time (lab proto to first shipment) to 12 months
Annual planning
Current Performance Gap Analysis Business Fundamentals Business Plan Hoshin Plan
Why separate business fundamentals planning from Hoshin planning?
People have a hard time balancing resources between urgent and important activities . . . urgent activities cause the most immediate pain
Effective planning techniques
Identify critical few objectives
Evaluate resource constraints
Establish performance measures
Develop implementation plans
Conduct regular reviews
Take corrective action
Plan linkage chart
Hoshin plan elements
Situation
Objective and goals
Strategies and owners
Implementation items and owners
Performance measures and timeline
Hoshin planning table
Hoshin planning guidelines
Understand the situation and the causes affecting the objective before developing strategies to achieve the objective
Select the few critical strategies that are necessary and sufficient to achieve the objective
Do not exclude objectives/strategies because the necessary measures do not exist
Avoid Hoshin strategies that are tactical in nature
Identify a single owner for each strategy
Planning guidelines -
continued
Align plans between departments
Develop measurable goals and targets
Review the plan periodically
Management must create the appropriate environment for planning and conducting reviews
Cascading / linking Hoshin plans
Top Management 1 Functional 1.1
1.2
1.3
Section 2 1.11
1.21
1.31
1.32
Department 2.1
1.111
1.211
MANUFACTURING MARKETING R & D 1.321
Cascading / linking Hoshin plans
Division Manager 1 Objective Strategy (Goal) (Measure) Functional Manager 1.1
Objective Strategy (Goal) (Measure) Section Manager 1.1.1
Objective Strategy (Goal) (Measure)
GOAL: To become the primary financial institution of its customers Quality personal service delivery Facility management Technology enhancement Coordinated marketing New definition of personal service Enhanced people skills Policy changes Procedure changes Determine skills required Develop training ATM Credit / debit cards Mortgages On-line banking Deliver training Test / certify Revise job descriptions Governance and strategy implementation p. 36
Goals are established based on
Past performance data
Competitive environment
Customer expectations
Current and projected resources
Estimates of future performance
Need for improvement
Identifying strategies
Strategies
How will we achieve the objective/goal
Owners
Who has responsibility for the achievement of each strategy
Performance measures
How will we track our progress on each strategy
Equation of goals & strategies
Does the set of strategies equal the goal (S 1 + S 2 + S 3 = Goal) If an equation can not be established, revise/improve the plan
If objectives are not met, you can trace goal performance through the performance of the strategies If objectives are not met, you can review the planning process
Good performance measures
Use customer focused measures whenever possible
Use measures that can be checked periodically/frequently
Use normalized measures when possible (e.g. per person, per unit, per $)
Use dimensionless measures (ratios, %, etc)
Use judgmental measures where appropriate
Measure results rather than activities where possible
Example performance measures
Manufacturing
% yield for product/process # days work in process inventory Research & Development
# months from investigation to first production # design problems solved in Manufacturing Marketing
% orders/forecast per product monthly % deadlines met for new product introductions Finance and MIS
# billing errors/invoice # hours system up-time/week Quality
% customer complaints/product
$ value of process improvements/improvement team
Implementation plan
Hoshin annual planning
Plan
Setting objectives, strategies, goals and performance measures Developing detailed implementation plans
Do
Deploying plans through the organization
Check
Reviewing progress and plan execution
Act
Ensuring appropriate actions are taken based on results of the plans (i.e. corrective action on deviations)
Review table
Plan linkage chart
Benefits of structured planning
Provides organization-wide focus; makes priorities obvious Helps ensure consensus on issues and priorities Aids coordination across departments and functions eliminating duplication of effort and misdirected action Facilitates teamwork Provides methodology for including customer needs Clarifies responsibility and ownership Allows better decisions and correction of significant problems
Benefits of structured planning
Provides organization-wide focus; makes priorities obvious Helps ensure consensus on issues and priorities Aids coordination across departments and functions eliminating duplication of effort and misdirected action Facilitates teamwork Provides methodology for including customer needs Clarifies responsibility and ownership Allows better decisions and correction of significant problems
Hoshin planning - summary
Planning for breakthrough improvement
Cascading/linking of Hoshin plans
Detailed implementation plans (strategies support objectives)
Robust reviews and corrective action
Hoshin planning – summary
2
We need everyone working on the right things
We need effective utilization of resources
We need to track our progress
We need to adjust to new situations … Focus, Orchestrate, Synchronize
Assignment
Read BA 550 class packet:
Framing for Learning – Tech Implementation
How to Get Aboard a Major Change Effort
Case brief – Silvio Napoli
Last names beginning with N - Z