Hoshin Kanri, also known as Policy Deployment or Strategy Deployment, is a management methodology that originated in Japan and was popularised by Toyota. Maybe you already have heard about if you know about the Toyota Production System, which is talked about during LEAN 6 Sigma courses, or the MUDA, MURI and MURA concepts used in many organisations out there to ensure optimisation of limited resources and capabilities. It is a systematic approach to aligning an organisation’s strategic goals with its actions and resources at all levels.
Hoshin Kanri involves a structured planning process that cascades strategic objectives throughout the organisation, ensuring alignment and accountability. The term “Hoshin” means “compass needle” or “direction needle,” and “Kanri” refers to management or control.
Here are the key elements of Hoshin Kanri:
- Establishing and Communicating Vision: The process starts by defining a clear vision and long-term strategic goals for the organisation. This vision should guide all subsequent planning and decision-making.
- Setting Breakthrough Objectives: Breakthrough objectives, also known as “Big Hairy Audacious Goals” (BHAGs), are ambitious targets that drive organisational progress. These objectives should be challenging but achievable and should align with the organisation’s vision.
- Developing Strategic Initiatives: Strategic initiatives are the specific actions or projects that will be undertaken to achieve the breakthrough objectives. These initiatives are carefully selected and prioritised based on their potential impact on the organisation’s goals.
- Cascading Objectives: Once the breakthrough objectives and initiatives are defined, they are cascaded throughout the organisation. Each level of the organisation sets its own objectives and initiatives that directly contribute to the higher-level goals. This ensures alignment and integration of efforts across different levels and functions.
- Catchball: it is a process of dialogue and feedback that occurs during the cascade of objectives. It involves a back-and-forth exchange between managers and their teams to ensure understanding, commitment, and refinement of objectives and initiatives. This iterative process helps to foster alignment and engagement.
- Establishing Measures and Targets: Key performance indicators (KPIs) and targets are established to measure progress toward the objectives. These metrics provide a means of tracking performance and identifying areas for improvement.
- Regular Review and Improvement: Hoshin Kanri is a continuous improvement process. Regular reviews are conducted to assess progress, identify issues or obstacles, and make necessary adjustments to keep the organisation on track. Lessons learned, and best practices, are shared and integrated into future planning cycles.
Hoshin Kanri promotes a disciplined and structured approach to strategic planning and execution. It encourages cross-functional collaboration, clear communication, and a focus on long-term goals. By aligning all levels of the organisation with a common vision and direction, Hoshin Kanri aims to drive organisational success and improvement.
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