When Nissan announced the successful launch of its HARGA (Sell One, Make One) Policy it was impossible for most people to understand the magnitude of the change within the company. Briyan Harrell, an independent automotive industry correspondent, wrote from his base in Tokyo that it involved a total re-organisation of market strategy and management oversight - a total corporate restructuring with new technologies throughout.
HARGA is Nissan's central strategy for its customers - designed to build automobiles to customer order for delivery in two weeks. This cuts down the delivery pipeline, making Nissan more sensitive and more responsive to customer desires. By minimising response time Nissan is better positive to customer desires. By minimising response time Nissan is better positioned were made to order' says Masakatsu Mori, a Tokyo partner in Andersen Consulting, which was assigned to assist with this formidable task.
Full mass prediction gave us goods that were made to stock. Modern technology allows us to reverse the flow of this trend. Assembly to order is now happening again and our ideal with the HARGA project is cars made to order. This will cause a revolution in the market place. The elimination of inventory means dealers will no longer be able to sell what they have, they must sell w2hat the customer wants. In and industry where traditionally 35 per cent of customers finish up with the specification available rather that the specification they really want, HARGA is a major competitive weapon.
Typically, Toyota has 35 000 variants of vehicle and, on average, only three identical vehicles a month are sold. So clearly the principles involved in establishing an organisation capable of achieving HARGA response in two weeks apply not just to the car industry but to all industry, including aerospace and mechanical equipment in particular. The most significant aspect of HARGA, however, is that it was only one of three major projects within the transformation. Harrell’s describes them as:
1. NAISS (Nissan Active Information System for Strategy). An accelerated business information system that makes it possible to close financial books in three days and hold a management meeting to review result a week later.
2. Wave. A change management programme combining more effective global management from world head-quarters in Tokyo with local responsibility and decision making.
3. Pipeline. The most visible and significant project, also known as HARGA.
The key point is that HARGA, the pipeline, while the most visible project, is part of one of three strategies being conducted simultaneously, in a synchronised way, under the business strategy and vision, which are targeted at customer response. The three strategies are: the technology strategy - NAISS; the people strategy - Wave, which handles the change management; the operations strategy - HARGA or pipeline. Without each of these strategies planned, in operation and synchronized, without day to day decisions being taken in the light of overall business strategy, the latter will fail. This fact has been at the root of several significant corporate reversals in the past decade and is probably the reason for Tom Peters' conclusion that there are no excellent companies. The transformation in thinking is difficult to achieve.
HARGA is Nissan's central strategy for its customers - designed to build automobiles to customer order for delivery in two weeks. This cuts down the delivery pipeline, making Nissan more sensitive and more responsive to customer desires. By minimising response time Nissan is better positive to customer desires. By minimising response time Nissan is better positioned were made to order' says Masakatsu Mori, a Tokyo partner in Andersen Consulting, which was assigned to assist with this formidable task.
Full mass prediction gave us goods that were made to stock. Modern technology allows us to reverse the flow of this trend. Assembly to order is now happening again and our ideal with the HARGA project is cars made to order. This will cause a revolution in the market place. The elimination of inventory means dealers will no longer be able to sell what they have, they must sell w2hat the customer wants. In and industry where traditionally 35 per cent of customers finish up with the specification available rather that the specification they really want, HARGA is a major competitive weapon.
Typically, Toyota has 35 000 variants of vehicle and, on average, only three identical vehicles a month are sold. So clearly the principles involved in establishing an organisation capable of achieving HARGA response in two weeks apply not just to the car industry but to all industry, including aerospace and mechanical equipment in particular. The most significant aspect of HARGA, however, is that it was only one of three major projects within the transformation. Harrell’s describes them as:
1. NAISS (Nissan Active Information System for Strategy). An accelerated business information system that makes it possible to close financial books in three days and hold a management meeting to review result a week later.
2. Wave. A change management programme combining more effective global management from world head-quarters in Tokyo with local responsibility and decision making.
3. Pipeline. The most visible and significant project, also known as HARGA.
The key point is that HARGA, the pipeline, while the most visible project, is part of one of three strategies being conducted simultaneously, in a synchronised way, under the business strategy and vision, which are targeted at customer response. The three strategies are: the technology strategy - NAISS; the people strategy - Wave, which handles the change management; the operations strategy - HARGA or pipeline. Without each of these strategies planned, in operation and synchronized, without day to day decisions being taken in the light of overall business strategy, the latter will fail. This fact has been at the root of several significant corporate reversals in the past decade and is probably the reason for Tom Peters' conclusion that there are no excellent companies. The transformation in thinking is difficult to achieve.
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