Most organizations struggle to define a real vision and work systematically towards achieving it. It is a critical management responsibility to deploy a strategy that establishes relevant goals and objectives and helps the organization to achieve its vision. Hoshin Kanri is an effective methodology that helps organizations define and deploy an effective strategy by simply applying Plan - do - Check - Act techniques.
“Strategy without tactics is the slowest route to victory, tactics without strategy is the noise before defeat.” —Sun Tsu
What is Hoshin Kanri
Hoshin Kanri is a Japanese expression (surprise!) that is not easy to translate. Hoshin means direction; Kanri means deployment/administration/ management. One could find many translations such as: policy management, Hoshin planning, policy deployment, compass management, etc.
Hoshin Kanri is perceived as the most powerful tool in the organizations’ planning toolkit. It also fulfills the Malcolm Baldrige National Quality Award criteria for Planning. Its core is focusing the efforts of the organization, at all levels, on the vital few, which will enable the organization to achieve breakthrough innovation and continuous improvement, and make the leap to the next level. It also creates a dynamic communication system across the organization, to maintain the main focus on achieving the organization’s vision.
How is it formulated
Step 1 – Create a Strategic Plan
It all starts with creating a strategic plan that focuses on five or less strategic goals, the vital few, that will lead to the organization’s vision and mission. These goals should be effective, in other words, doing the “right” things to take the company to the next level. While developing the strategy, consider both incremental and breakthrough improvement . During this process, enforce top down consensus, in addition to providing feedback. Communicating the plan with lower level management creates a sense of ownership to all levels. One of the most important aspects to consider is the selection of KPI’s, wisely select the right KPI’s that will drive the organizational behavior closer to its vision and mission. And at last, owning the goal, each goal should have an owner, capable of removing roadblocks and track progress.
Step 2 – Develop Tactics
Mid-level managers at the department level, will develop the methods (tactics) to achieve the goals set by top management. Using “catchball”, the two way communication will ensure proper understanding and alignment of goals and tactics, in addition to the proper selection of KPI’s.
Step 3 – Take Action
Just like the previous step (step two), the planning will go to the next level, Gemba (plant floor level), where action takes place. In this step team leaders and supervisors will develop the operational plans to implement the tactics developed by mid-level managers. Catchball will have the same role in aligning operations with tactics and strategy.
Step 4 – Review and Adjust
This step ensures that the information will flow from the plant floor to the top management. The flow of information from bottom up will create a closed loop system, allowing tuning and adjustments of all processes.
The X Matrix
The Hoshin Planning Matrix, also called the X Matrix, is used to capture the objectives and cascading priorities.
