Hoshin Kanri (also called Policy Deployment) is a method for ensuring that the strategic goals of a company drive progress and action at every level within that company. This eliminates the waste that comes from inconsistent direction and poor communication.
Hoshin Kanri strives to get every employee pulling in the same direction at the same time. It achieves this by aligning the goals of the company (Strategy) with the plans of middle management (Tactics) and the work performed by all employees (Operations).
Key items to consider when developing the strategic plan are:
Involve the Whole Team
People will become much more invested in executing the strategic plan if they have a hand in developing it. Of course, your organization is not a democracy. It is up to leadership to determine the direction and set the breakthrough goals, but how you get there (and whether you get there) will ultimately be in the hands of the people who do the work and make the small decisions that add up to success. That should be apparent in your planning process.
Focus on Five
Focus on five goals (or less). The mere act of writing down goals can create a (false) feeling of progress – and more goals feels like more progress. In reality, a goal only expresses intent. Taking action is the hard part. Every company has finite resources and energy…and a limited attention span. Focusing on a small number of goals makes success far more likely than dissipating energy across dozens of goals. Or looking at it another way…if everything is important; nothing is important.
Effectiveness First
There is a well-known distinction between efficiency and effectiveness: efficiency is doing things right while effectiveness is doing the right things. Strategic goals need to be effective – doing the right things to take the company to the next level. If a goal doesn’t have that kind of broad impact it’s probably not strategic.
Evolution vs. Revolution
Goals can be evolutionary (incremental goals usually achieved through continuous improvement) or revolutionary (breakthrough changes with dramatic scope). Both are legitimate and important forms of improvement.
Top Down Consensus
Top management is responsible for developing the strategic plan – it’s one of their most important responsibilities. But taking the time to consult with middle management serves two useful purposes:
- It provides additional perspective and feedback that helps craft stronger, more informed strategies
- It creates a sense of shared responsibility for the plan and significantly more buy-in from middle management
Choose KPIs With Care
Key Performance Indicators (KPIs) provide the means for tracking progress towards goals. They also have a considerable ability to drive behavior. So choose KPIs with care. It is essential to think through whether the selected KPIs will drive the desired behavior without unintended side effects. For example, more than one company has found that a single-minded pursuit of efficiency can lead to unintended consequences such as excess inventory (larger batches means less changeovers) and reduced quality (a subtle “fix it later” pressure creeps in to keep lines running).
Own the Goal
Every goal should have an owner – a facilitator and coach who has the skills and authority to successfully see the goal through to conclusion.
- As a facilitator, the goal owner will remove roadblocks and smooth the path to progress
- As a coach, the goal owner will track progress and intercede if things get off track
Celebrate Success
Hoshin Kanri is all about breakthrough goals, but you don’t get there without a bunch of small victories. Be sure to take the time to celebrate every single one and put each in context of the big picture. Every time you recognize an employee or team for doing the right thing, solving problems, and innovating processes you increase the likelihood that others will do the same. Continuous improvement is contagious, so share it far and wide.
People perform best when they have a purpose. When they understand not just what to do – but why it’s important. One of the benefits of Hoshin Kanri is that it can help to create that purpose; providing focus and drive towards specific and important goals.
So, it’s worth putting some effort into creating a shared vision of the strategic plan (the future state; the destination) and associated tactics (the path to get there). Make sure as many employees as possible are given an opportunity to understand why the strategic goals are important and how the tactics and operational details support those goals.
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