Upcycling a haori (several models can be seen here) into a dress or gown requires a few more operations than for a michiyuki.
First, start by the easiest part: remove the sleeves then stich in the edges that were attached to the sleeves, by hand or machine.
To avoid some uncomfortable gaping, sew a few centimeters at the level of the underarm.
Afterwards, take a sleeve, open it to obtain a long and neat band, sew the sides that have been opened.
Put this band on the inside part of the front of the haori.
You will face a big challenge: you need to lay the band on the front and adjust it from the back so you will move comfortably, but not in a potato-like dress. You will need pins for your different attempts.
Try to keep the stitches from being noticed on the front side, just like on this photo (except for the top of the band):
To do so, sew the band on the edge of the back side of the collar, while avoiding the contact with the front side. By doing so, the stitches will be visible only on the back side.