the results of a SWOT analysis.


• Acquisition Decision Making: A needed expansion was achieved by undertaking a study of other met- alcasters and related industries, and deciding on making an acquisition. This important strategic decision must be analyzed properly before an investment is made.


• Product Mix Change: A new prod- uct introduction targets a certain segment of the economy, or it can be in the form of a change to an existing product line. This initiative resulted from a decision to focus on core competencies.


• Energy Savings Initiatives: Metalcasting is an energy intensive industry, and any effort to monitor and control energy use will yield financial rewards. Adopting green manufacturing initiatives will assist metalcasters in meeting and even exceeding various environmental regulations. Successful implementa- tion of an environmental related business plan also comes with some tangible and intangible financial benefits. This was one of the top- most financial yielding initiatives.


• Business, Process or Product Improvement Initiatives: Business, process or product improvement plans are practical at the tactical level where improvement projects were carried out in many areas of the company.


• Raw Materials Sourcing Strategy: Most metalcasters practice raw materials sourcing strategy devel- opment, and when strategically planned, it can yield great benefit.


A Success Story One company’s plan for a partner


metalcasting facility had eight vital goals or strategies. Te method and scope of deployment was determined after the implementation programs were accepted and approved. Cause- and-effect thinking and other tools were used while establishing imple- mentation programs. One of the vital goals was in the


area of raw material sourcing. Te cost of mined and processed nickel for a plant in Toronto, Canada, was the same from two sources, and both had


Fig. 1. The “Deming Circle” is named after William Edwards Deming, an American statistician who invented “Plan, Do, Check, Act” (PDCA) planning.


June 2014 MODERN CASTING | 33


ample quantities. One supplier deliv- ered it by rail from Sudbury, Ontario; the other by rail from Tompson, Manitoba, Canada. If energy prices were not expected


to increase in the foreseeable future, then signing contracts with one or the other supplier would be based on cost alone. On the other hand, if the price of energy and consequently the cost of freight were expected to double, then one source of supply could be more attractive and less risky than the other. Te partner foundry discovered an increase in energy pricing and was able to lock in pricing and supply terms that gave it a competitive advantage over its competitors. It established, deployed and implemented this strat- egy and achieved financial gains.


Definition and Prioritization of Vital Goals


To reduce ambiguity and misinter-


pretation during the planning phase of Hoshin Kanri, use a fact-based interlevel negotiation process known as “Catchball.”


Hoshin planning begins with senior


management defining, identifying and prioritizing the strategic goals to be achieved, complete with deadlines. Once determined, these “challenges” are sent to the operational units, which break them down and determine what each unit and person must do to achieve the manage- ment objective. Tey then bounce the “ball” back to senior management, who “catches” it and determines whether the execution will be satisfactory. If not, the “ball” is bounced back to operations again, and they “catch” it and respond


accordingly. As in the example, this process should take place under the monitoring of an experienced consultant. An X-Matrix tool developed for the


company described the main founda- tion of its vision upon which its strate- gies, tactics, processes and results rest. It is the ability to analyze and document the corresponding correlation between the strategies, tactics and processes that usually brings in the expected results. Tis correlation must be analyzed and understood fully to guarantee a strong or at least an important correlation but never weak correlation among the strategies, tactics, processes and results, or else the entire strategic planning project will fail. When correlations are found to be weak, measures are taken to reverse that, when possible. Te measures may dictate changes in one of the other key areas such as a change to strategies, tactics or processes, to revamp initiatives and reverse the weak correlation. An X-Matrix helps corpo- rations and others allocate individual responsibility to leaders of teams who are made to be accountable to the entire Hoshin Kanri team.


Team-based Implementation Typically, a Hoshin Kanri project


involves establishing an execut- ing Hoshin Kanri team that is the backbone for ensuring the entire project’s success. Occasionally, a Hoshin team is assigned the duty of developing long-term, mid-term and annual strategies. Te tactical team handles the tactics, the operational team handles all operational activi- ties or projects, and the action team


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