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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

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organization management

ORGANIZATION MANAGEMENT

Structured Planning /

Hoshin Planning

does your organization
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
Hoshin Planning
  • The Hoshin planning process is a systematic approach to identify, sort and resolve issues requiring breakthrough improvement
business fundamentals
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
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
Annual planning

CurrentPerformance

BusinessPlan

Gap Analysis

BusinessFundamentals

HoshinPlan

why separate business fundamentals planning from hoshin planning
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
Effective planning techniques
  • Identify critical few objectives
  • Evaluate resource constraints
  • Establish performance measures
  • Develop implementation plans
  • Conduct regular reviews
  • Take corrective action
hoshin plan elements
Hoshin plan elements
  • Situation
  • Objective and goals
  • Strategies and owners
  • Implementation items and owners
  • Performance measures and timeline
hoshin planning guidelines
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
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

1

Top Management

Functional

Section

Department

1.1

1.2

1.3

1.11

1.21

1.31

1.32

2

2.1

1.111

1.211

1.321

Cascading / linking Hoshin plans

MANUFACTURING MARKETING R & D

cascading linking hoshin plans15
Cascading / linking Hoshin plans

DivisionManager

FunctionalManager

SectionManager

Objective Strategy (Goal) (Measure)

1

1.1

Objective Strategy (Goal) (Measure)

Objective Strategy (Goal) (Measure)

1.1.1

slide16

Determine skills required

Develop training

Deliver training

Test / certify

Revise job descriptions

Quality personal service delivery

Facility management

Technology enhancement

Coordinated marketing

New definition of personal service

Enhanced people skills

Policy changes

Procedure changes

GOAL: To become the primary financial institution of its customers

ATMCredit / debit cardsMortgagesOn-line banking

Governance and strategy implementation p. 36

goals are established based on
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
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
Equation of goals & strategies
  • Does the set of strategies equal the goal(S1 + S2 + S3 = 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
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
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
hoshin annual planning
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)
benefits of structured planning
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 planning27
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

Improves PlanningAssures Excellence in Execution

hoshin planning summary
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
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
Assignment
  • Read BA 550 class packet:
    • Framing for Learning – Tech Implementation
    • How to Get Aboard a Major Change Effort
  • Case brief – Johnsonville

Last names beginning with N - Z