Balanced scorecard andhoshin kanri: dynamic capabilities for managing strategic fit

Abstract

Purpose: The paper combines the uses of the balanced scorecard and hoshin kanri as integrative dynamic capabilities for the entire strategic management process. A model is posited for the combination of these long-term and short-term organizational activities as a framework for a senior level to manage a firm's strategic fit as an integrated organization-wide system that links top management goals to daily management. Methodology/Approach:The resource-based view of strategy is explored for its relevance to how a combined balanced scorecard and hoshin kanri approach serves as a high-order dynamic capability. Examples are given from Canon, Toyota and Nissan, of how core capabilities are managed to show how strategy is executed cross-functionally across a firm's functional hierarchy. Findings:The strategic management of the organization should consider the long-term strategy as well as the short-term capability. Important to this are: core capabilities and core competences, cross-functional management, and top executive audits, which when managed properly, explicate a new view of strategic fit, as a form of nested hierarchies of dynamic capabilities.Originality/Value: The paper is the first exposition of how balanced scorecard and hoshin kanri practices may usefully complement each other in strategic management. It is a useful framework for dynamically managing sustained competitive advantage.

Aligning university–industry interactions: The role of boundary spanning in intellectual capital transfer

“…Acknowledged (in a footnote) by the authors themselves (see Kaplan and Norton, 1993), the balanced scorecard technique replicates the key drivers of hoshin kanri to achieve organizational alignment. It does so in the form of balanced scorecard perspectives operating synonymously against QCDE (quality, cost, delivery and education) variables, within the language of total quality management, that form the basis for hoshin kanri (Witcher and Chau, 2007) and which improves overall organizational, strategic and performance management (Witcher and Chau, 2012). Total quality management methodologies have been used historically to ensure the 'totality' of a system (hence, offering the best chance to achieve holism) can be achieved at a level of quality equal to zero-deficiency; this ultimate state would allow for best alignment.…”

Importance of managing intangible assets in enhancing dynamic capabilities of firms: cases from Sweden and Germany

“…Henri, 2006b;Nixon & Burns, 2005) argue that there is a need for more interdisciplinary research, and that the MCS literature has devoted limited attention to the dynamic capability perspective (Henri, 2006b). Inadequate attention has been devoted to how a robust integrative learning framework can be used as a dynamic capability for analyzing and balancing the different aspects or components of MCSs (Simons, 1995) in order to create organizational capabilities (Grant, 2007;Henri, 2006b;Witcher & Chau, 2007).…”

“…According to the dynamic capabilities framework, the learning mechanisms vary with whether the processes are based on explicit casual relationships or whether the relationships can be characterized as opaque and dynamic (Ambrosini & Bowman, 2009;Eisenhardt & Martin, 2000;Zollo & Winter, 2000). Dynamic capabilities related to the former resemble the traditional conception of routines, relying heavily on existing knowledge, while dynamic capabilities related to the latter are simple, experiential, unstable processes that rely much less on existing knowledge and much more on rapidly creating new knowledge and iterative execution (Eisenhardt & Martin, 2000, p. 1106).…”

“…T he changing nature of the global economy requires dynamic management at firm level (Eisenhardt & Martin, 2000;Henri, 2006b;Teece, 2007;Witcher & Chau, 2007;). There seems to be a growing consensus that the basis of competitive advantage is changing from managing tangible resources to managing intangible resources (Hand & Lev, 2003;Høgh-Krohn & Knivsflå, 2000;Lev, 2008;Revellino & Mouritsen, 2009;Upton, 2003).…”

A Continuous Improvement and Monitoring Performance System: Monitor - Analysis - Action – Review (MAAR) Charts

“…The survey concludes that a methodology will only be good according to those who guide and execute it. Witcher and Chau (2007) discussed a complementary use of the balanced scorecard and hoshin kanri. It aims to posit a model for the combination of these long and short-term organizational activities as a framework for a senior level to manage a firm strategy that fits as an integrated organization-wide system that links top management goals to daily management.…”