IENG 451

Planning Functions

Responsiveness

Customer Satisfaction

Cost + Quality +Dependability + Flexibility + Time + Service

6 Dimensions of Competition

Structural Prerequisites

Continuous + R&D + Advanced Tech. + IntegrationImprovements People & Systems

Customer Driven Strategy

Planning Functions

• Operational – How do we manage day to day

• Financial – How do we allocate resources

• Project– How do we achieve a specific goal

• Strategic – What do we want to be when we grow up

Problems

• Unrealistic goals • Goals are arbitrary • Inadequate focus • Planned activities are not regularly reviewed • Data is over analyzed • Lack of communication; vertical and/or

horizontal

Mission & Strategy

• Def: The corporate mission outlines a firm’s values, intended markets and product, broad goals and objectives, core competencies, and strategic capabilities.

• Def: The corporate strategy states how a firm will achieve its goals and objectives

What is Strategy?• Distinguishing strategy from tactics:

– Strategy is the overall plan for deploying resources to establish a favorable position.

– Tactic is a scheme for a specific maneuver.

• Characteristics of strategic decisions:– Important.– Involve a significant commitment of resources.– Not easily reversible.

Effectiveness and Efficiency

Leaders

Doing Right Things

Ineffective EffectiveIn

effi

cien

tE

ffici

en

t

Man

ag

ers

Doin

g T

hin

gs

Rig

ht

Death(fast)

Success

Death(slow)

Survival

Managing Complex Change

ConfusionSkills Incentives Resources Action Plan

Change

Vision Incentives Resources Action Plan

Vision Skills Incentives Resources Action Plan

Vision Skills Resources Action Plan

Vision Skills Incentives Action Plan

Vision Skills Incentives Resources

Anxiety

GradualChangeFrustration

FalseStarts

Strategic Process

Mission &Strategic Goals

Competitive Analysis * Strengths * Weakness * Opportun * Threats

SpecificStrategies * Corporate * Business * Functional

Carry OutStrategicPlans

MaintainStrategicControl

Assess EnvironmentalFactors

AssessOrganizationalFactors

Strategy Formulation Strategy Implementation

One of the Tools

Competitive Analysis• SWOT

– Strengths– Weaknesses– Opportunities– Threats

Macroprocesses

• Juran– anatomy of macroprocess does not match that of the

functional organization– Functional goals often at a heavy price of

macroprocess– There should be a clear responsibility for macroprocess

Inspect Customer

Forced Choice Model

Organization Position• Mission• Objectives • Strengths, Weaknesses• Forecast Operational needs• Major Future Programs

Environmental Assessment• Economic Environment• Key regulatory issues• Major technology forces• Opportunities, threats• Competitor strategies

Strategic Options Action Plans

Contingency Plans

Hoshin Kanri or Policy Deployment

• The Company develops a 3 - 5 year plan• The Senior Executives develop the current

years objectives.• Catchball occurs

– The process is interactive– Teams report up– Management delivers feedback

Hoshin Planning

Elements of Hoshin Planning

• Plan-do-check-act • Nemawashi• Catchball• Control department• A3 thinking

Elements of Hoshin Planning

• Plan-do-check-act– Macro, 3-5 yrs, senior management– Annual, operating managers

• Nemawashi• Catchball• Control department• A3 thinking

Elements of Hoshin Planning

• Plan-do-check-act• Nemawashi

– Process of consensus building that creates alignment

– Stakeholders; management, workers, customers• Catchball• Control department• A3 thinking

Elements of Hoshin Planning

• Plan-do-check-act• Nemawashi• Catchball

– Company develop a vision and toss to senior mgmt– Sr. mgmt translate vision to hoshins and toss back– Give and take until consensus is reached

• Control department• A3 thinking

Elements of Hoshin Planning

• Plan-do-check-act• Nemawashi• Catchball• Control department

– Breakdown functional silos– Control dept., quality, would coordinate cross-

functional activities • A3 thinking

Elements of Hoshin Planning• Plan-do-check-act• Nemawashi• Catchball• Control department• A3 thinking

– One page story communication tool– Hoshin planning A3 – Problem Solving A3– Proposal A3– Current Status A3

4 phases of Hoshin Planning

• Hoshin generation• Hoshin deployment• Hoshin implementation• Final evaluation

4 phases of Hoshin Planning

• Hoshin generation– Eg; we will reduce defect rates by 20%

• Hoshin deployment• Hoshin implementation• Final evaluation

4 phases of Hoshin Planning

• Hoshin generation– Eg; we will reduce defect rates by 20%

• Hoshin deployment– Here’s how we can achieve this goal

• Hoshin implementation• Final evaluation

4 phases of Hoshin Planning

• Hoshin generation– Eg; we will reduce defect rates by 20%

• Hoshin deployment– Here’s how we can achieve this goal

• Hoshin implementation– Activities required to implement hoshin; e.g.;

defect data collection, analysis• Final evaluation

4 phases of Hoshin Planning

• Hoshin generation– Eg; we will reduce defect rates by 20%

• Hoshin deployment– Here’s how we can achieve this goal

• Hoshin implementation– Activities required to implement hoshin; e.g.;

defect data collection, analysis• Final evaluation

– Year end assessment of each hoshin