All entries for Tuesday 12 December 2006

December 12, 2006

LE Module Review–Part II–Among the HK BSC BPR

3. Similarities and differences
The concept of Hoshin Kanri has been regarded as an approach to business policy deployment .This section is going to compare Hoshin Kanri with the other two approaches Balanced Scorecard and Business Process Reengineering and trying to find out their similarities and differences about policy deployment, based on the consideration of performance management.Also this section is divided into three parts.Firstly a defination of the three approaches would be defined by literature review.Secondly the similarities of the three approaches will be addressed.Thirdly the differences of the three approaches will be addressed.

3.1 Defination of three approaches
The definations of three approaches are defined as the followings:
Honshin Kanri:(HK)
In Minzunode’s words,”Deploy and share the direction, goals, and approaches of corporate management from top management to employees, and for each unit of the organisation to conduct work according to the plan. Then, evaluate, investigate and feed back the results, or go through the cycle of PDCA continuously and attempt to continuously improve the performance of the organisation.” [1]

Balanced Scorecard:(BSC)
According to Robert Kaplan and David Norton [2], “The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation.”

Business Process Re-engineering:(BPR)
In Hammer’s words [3],”the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical contemporary measures of performance, such as cost, quality, service, and speed”

3.2 Similarities
According to Minzunode [1], Honshin Kanri is an approach to help the coporate plan the deployment of the performance management to improve and achieve the goal.Similarily, Balance Scorecard is seaking for the coporate’s performance, alignment, and integrated targets to all organisations. [8]Also, for Business Process Re-engineering is an apporach to rethink about the measurement of company’s policy performance to achieve improvement toward a plan. [3]

3.3 Differences
According to Roberts and Tennant7, Honshin Kanri is a holistic view of approach to deploy the organisations’s policies and looks for the performance improvemet.With respect to the Balanced Scoredcard, Kaplan and Norton [4] noted that Balance Scorecard focus on the important metrics and followed by five steps about the deployment of functional level that drive success- financial perspective with customer, internal process, learning and growth perspectives.Furthermore,Business Process Re-engineering is a localized and incremental approach that delpoys complex processes to less improve the overall effectiveness of business operation.[5]

According to Mizunode [1] Honshin Kanri and is an approach to seek for continuous improvement of the strategic performance.Concerning Business Process Re-engineering Hammer [3] points out that it is an approach for inventing new ways to dramatically improve the measures of performance such as quality, cost, service and speed.

As for Business Process Reengineering, the term “reengineering” is used to be a reason for the company to lay off the employees and looks for new changes to improve the performance. In Davenport, Thomas’s words [6],”... once out of the bottle, the reengineering genie quickly turned ugly. Sougly that today, to most businesspeople in the United States, reengineering has become a word that stands for restructuring, layoffs, and too-often failed change programs.??On the contrary, according to Roberts and Tennant [7] Honshin Kanri and Business Scorecard [9] are approaches that seek for a strategic and continuous improvement of existing process.

1. Eureka, W.E. & Ryan, N.E. (1990). The Process-Driven Business: Managerial perspectives on policy management. ASI Press, Dearborn, USA.
2. Kaplan R S and Norton D P (1992) “The balanced scorecard: measures that drive performance”, Harvard Business Review Jan ?V Feb pp71-80.
3. Hammer, Michael and Champy, James (1993), Reengineering the Corporation: A Manifesto for Business Revolution, Harper Business
4. Kaplan, R.S. and Norton, D.P. (1996) Translating strategy into action: The balanced scorecard, Boston: Harvard Business School Press.
5. Guha, S.; Kettinger, W.J. & Teng, T.C., Business Process Reengineering: Building a Comprehensive Methodology, Information Systems Management, Summer 1993
6. Davenport, Thomas (1995), Reengineering – The Fad That Forgot People, Fast Company, November
7. Paul Roberts, Charles Tennant(2003), Application of the methodology at a higher education establishment in the UK, The TQM Magazine.15(2)
8. iSixSigma LLC ,, Dec.2006 accessed
9. Mandar Dabhilkar, Lars Bengtsson, Balanced scorecards for strategic and sustainable continuous improvement capability, Journal of Manufacturing Technology Management, 15 (4),2004

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