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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
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