Application of hoshin kanri for productivity improvement in a semiconductor manufacturing company

Abstract

PurposeThe planning approach used is issue‐based planning or formal strategic planning, leading to local optimization and duplicated redundancy. An approach is presented in the rapid growth of the business scale which emphasizes both customization and effectiveness, not only operation efficiency. The paper addresses these issues.Design/methodology/approachA two‐phase approach is applied to obtain a smooth implementation. A lean operation concept is executed in the first phase to reduce the engineer's workload, and the business process re‐engineering (BPR) technique is used in phase two to transform the working model.FindingsThis paper presents an extension model of hoshin kanri to translate strategies into achievable policies and actions to fulfil the objectives of the enterprise. This model not only comprises a complete plan and executive structure which is simple and effective, but also conducts complicated communication processes at different levels to achieve the common goals as envisioned by the executive management.Practical implicationsA case study is introduced to show the complete policy deployment process and realize the actual “vital few”. This study has been successfully implemented in the case company, and the labor productivity was improved by 6 percent over a two‐year period.Originality/valueThe paper presents a successful application of hoshin kanri for a semiconductor manufacturing company within a rapid growth environment.