An Integrated Model of Hoshin Management and Six Sigma in High-Tech Firms

Abstract

ABSTRACT Hoshin management has been widely implemented in Japan and Taiwan for many years, and many Western companies are now also adopting this management system. Hoshin management is a powerful management tool, as has been confirmed by the companies that have implemented it. The GE Six Sigma programme has also been widely adopted in recent years by various industries and non-profit organizations around the world. Hoshin management and Six Sigma both relate to an organization's vision and strategy. However, in most cases, these two systems have been implemented separately – thus producing a number of significant problems. The present study develops an integrated model of Hoshin management and the Six Sigma programme. This integrated model links an organization's annual objectives and the Six Sigma programme to the organization's vision and strategy. In addition to such a linkage, the model includes an analysis of VOS and CSFs – which is critical in developing KPIs and an appropriate focus for the deployment of Six Sigma projects. This integrated model embeds the Six Sigma programme into the implementation framework of Hoshin management, which can enhance an organization's development of Hoshin and simultaneously solves the deployment and auditing problems involved in the execution of Six Sigma projects. Several well-known companies in Taiwan have successfully utilized the framework developed in this study. An empirical case study is provided to demonstrate the feasibility and effectiveness of this integrated model.