Hoshin Kanri:Survey Results – A Strategic
Planning System Through Creation, Dialogue, Review, Manager Development, Alignment &
Collective Involvement.
November 8, 2017Dennis M. Gawlik
Faculty – The Presidio Graduate School
San Francisco / Seattle USA
“The single biggest problem in communication is the illusion
that it has taken place.”
George Bernard Shaw
BA
CD
Why Hoshin Kanri MattersConventional
Strategic Planning and Tool-Based Initiatives Fall Short
Hoshin Kanri as a System Adds Value(see also Mr. I. Yoshino’s Plenary):
Alignment (horizontal & vertical)Manager Development/CommitmentAdaptive / Reviewed RegularlyManagement AccountabilityFocus on Few, Vital Priorities
Employee EngagementExecutionSimply PDSA
Learning Org / Employee Creativity
Survey Background:Examined:Strategic Planning Approaches Hoshin Kanri Use
Mid-Size/Large Organizations
Middle & Upper-Management
5 Yrs. / 431 Surveys Sent
112 Surveys Received Back / 26% Return Rate
When is Strategic Planning Conducted?
Annually
Other
QuarterlySemi-Annual
74%
15%2%
I don’t know 5%
4%
Note: 93% of Organizations Conduct Formal Strategic Plans
Conventional Planning Approaches:
“Annual Based” Strategic Approaches:
Too many KPIs (5 – 15), not critical few
Too many Non-Complementary Tools
Fewer strategic problems solved
Fewer strategic targets/goals met
Less flexible to changing environment
“Metric” focused Strategies:
Key primarily on results/metrics, less on purpose, means or customer
Top-down approach
Sample Size: Annual Survey, 5 Years of Data 431 Surveys / 112 Returned
Conventional Planning Satisfaction
54%Not Satisfied with
Process
46%Satisfied with
Process
5%
6%
14%
29%
8%
24%
14%
0% 5% 10% 15% 20% 25% 30%
Extremely Dissatisfied
Quite Dissatisfied
Somewhat Dissatisfied
Neither
Extremely Satisfied
Somewhat Satisfied
Quite Satisfied
No Steady
Progress, 15%,
No Process & Missed
Targets 12%
More than 5 Strategic
Objectives, 22%Had Process, Was
Not Effective 27%
Did not Change with
Market, 24%
Issues
Ends (results) vs. Means (how)
Reactive Metricsvs. Proactive / Lead
Top-Down Driven
Annual
Drawbacks
0%
5%
10%
15%
20%
25%
30%29%
25%
16% 14%
8% 8%
Common Concerns
Key Findings: Leaders focus on “Directing”, not Coaching
Little Manager Development
“Annual” format: Leaders have too many indicators (5 – 15),
not important few
Identifies fewer overall problem / fewer solved or escalation
Tied to one way of planning rather than flexible approach
“Metric Focused”: Leaders lead by metrics, less true knowledge
of business
Approach focuses more on department results, less on customer value
Processes & Tools
A Typical Process
Customer
Perspective
Learning &
Growth
Perspective
Business
Processes
Perspective
Financial
Perspective
Targets Set
for Key
Performance
Indicators
Process
Execution &
Improvement
Project
Plans &
Resource
Allocation
Leads toNego-
tiationInputs
Results – Reflection to Identify Continuous
Improvement Opportunities
1
2
3
4
5
6
7
Operational Excellence Consultancy: Hoshin Kanri Strategy Deployment
The X- Matrix & Planning
Hoshin Kanri
Hoshin Kanri -The Toyota Way
In Japanese, (方針管理)
Hoshin means "compass needle" or "direction"Kanri means “control” or “management”.
Hoshin Kanri Model
Attributes of Hoshin Kanri Align shared improvement goals
both vertically and horizontally
‘Means’ Focused Resources
Customer / Business Centric
Builds Employee Ownership
Leadership Development / Growth
Visible / Proactive / Flexible
Periodic Follow-Up & Review
Reflection / Learning Organization
Inclusive in Approach
PDCA - Typical Organization
Do
Plan
Check
Act
Operational Excellence Consultancy: Hoshin Kanri Strategy Deployment
DO
Plan
Check
Act
…or Maybe it’s Like ThisDo
Plan
Check
DO
Lean Approach
Do
PlanCheck
Act
PLAN
The Hoshin Kanri Approach
Do
Plan
Check
Act
Hoshin Kanri – Means Focus
Hoshin Kanri
Customer Value
Co
nti
nu
ou
s Im
pro
ve
me
nt
Management by Fact
Te
am
wo
rk
Alignment Principle
Operating
Philosophy
Operational Excellence Consultancy: Hoshin Kanri Strategy Deployment
Means vs. Ends
* Means Focus *
A Hoshin Kanri System –Goal Alignment
•Alignment
through
entire
company
•Each
subsequent
goal
supports the
previous
level’s goals
Ver
tica
l alig
nm
ent
Organization
Goals
Department
Objectives
Individual
Objectives
Department
Objectives
Individual
Objectives
Individual
Objectives
Individual
Objectives
Horizontal
Alignment
*Horizontal*
Top-down focus
on creating and
improving
systems
HOSHIN KANRI
INTEGRATED WITH
Bottom-up
focus on
total employee
involvement in
continuous improvement
TOTAL EMPLOYEE INVOLVEMENT
*Teamwork*
Hoshin Kanri & Employee Involvement
Hoshin Kanri – Principles First• Vision
• Mission
• Shared Values
Management by Principles
• Objectives Setting
• Target-means Deployment
• Management Development
Management by Priorities
• Network of Inter-related Projects
• Cross-functional Management
Management by Projects
*Principles*
*Development*
*Cross-Function*
Hoshin Kanri - Aligned Service Excellence • Leadership creates a
challenging vision of service excellence the entire organization must strive towards based on:
• Passionately pursuing
purpose based on
guiding values (TWTSE Principle 1)
• Deeply understanding
customer needs (TWTSE Principle 2)
Jeffrey Liker and Karyn Ross: The Toyota Way to Service Excellence: Lean Transformation in Service Organizations, McGraw-Hill, NY, NY 2016.
* Top Down *
* Bottom Up*
Hoshin Kanri Process – Catch BallDirection of
information flow
Catchball:
Negotiation &
Alignment between
two levels
Owner
Manager
Coach
Captain
Front Line
Increase Fan
Satisfaction
Feedback
Feedback
Feedback
Feedback
Practice Team and
Individual Assignments
To improve
quality
Improve
overall goal yield
Increase
Passes
Reduce Missed
Assignments
Policy Owner Objective Means
To improve
quality
Increase
Passes
Operational Excellence Consultancy: Hoshin Kanri Strategy Deployment
= Catch Ball
* Catch Ball *
Kata for Aligned Organizational Learning & Creativity!
CK/IK
CK/IK
CK/IK
Creative new
services!
Creative new
services!
Creative new
services!
Organization Flourishes and Thrives!
Customers Continuously Delighted!
* Alignment *
CK = Coaching Kata / IK Improvement Kata
* Creative*
Hoshin
Daily Mgmt. (DM) with Kaizen
DM with
no HK
Time
Per
form
ance
(K
PI)
HK with no DM
PD
CA
PD
CA
PD
CA
PD
CA
PD
CA
PD
CA
Relationship of Hoshin, Daily Mgmt. & Leader Development
- Both are essential - Maintain good balance
Jeffrey Liker: Developing Lean Leaders At All Levels; A Practical Guide: 2015, Figure 7-5.Hoshin Kanri and Daily Management work together for breakthroughs and sustainment
- Both are essential - Maintain good balance
* Hoshin,
Daily Mgmt. &
Development *
Hoshin Kanri Process
13%
9%
11%
3%
10%
13%
5%
5%
0% 2% 4% 6% 8% 10% 12% 14%
Accountability - Implementing
Accountability - Resourcing
Breakthrough Objectives
Other
Process Focus
Strategic Metrics
Results Focused
Understanding of Variables
Critical Success Factors
Hoshin Kanri Success
0%
5%
10%
15%
20%
25%
30%
35%
40% 36%
13%
7% 7% 6% 6% 5% 5% 5% 4% 3% 3%
Learnings
Survey Results –Hoshin Kanri Key Considerations
Linked to purpose/key strategies Vertically/Horizontally ‘Means’ FocusMeasures tied to Objectives
Leadership Development Customer Focused Collective Involvement “Correct” Practice/PDCA/PDSA
Alignment of Personal and Company Values Periodic Follow-up/Review
(daily/monthly/quarterly/yearly) Hoshin Challenges: From/To/By when
Grasp the Burden; mid-level mgmt.
Common Factors Identified In Sub-Optimal Hoshin Kanri Efforts Wrapping today’s Strategic
management process in A3 Paper Not knowing ‘why’ Setting broad & vague objectives
Writing the Hoshin plan on a computer & keeping it there
Having a strategy that is “too good” to be changed
Poor Execution
Source: gemba panta rei and D. Gawlik Hoshin Kanri Survey 2017
Using the process for negotiation, not consensus
Research Summary
Over 93% of Organizations conductFormal Annual Strategic Plans
Managers Committed / Developed
72% Not Satisfied with Current Process
Hoshin Kanri Ties Annual Strategy Development / Progress with Daily Management
Hoshin Kanri Aids in Engagement, Alignment, Focus, Execution, Review & Follow Through
Long-Term Approach: Expect to Start Seeing Returns Between 3 and 12 Months
Hoshin Kanri
WHAT QUESTIONS DO YOU HAVE?
Comparison of Management By Objective (MBO) and Hoshin Kanri
Management by Objectives Hoshin Kanri
Short-Term, Weak Adherence
with Company Philosophy
Long-Term, Strong Guiding
Principles
Results / Budget Oriented &
Evaluation of Effort
Concerned with Results and
Process with Focus on People
Development
Top down
Communication / Large Number
of Objectives
Top down Direction Setting and
Bottom-up flow of Information,
PDCA - PDSA and Means
Directive Participative / Systematic
Management of Processes
Primarily Authority Oriented Primarily Responsibility Oriented
Jeffrey Liker: Developing Lean Leaders At All Levels; A Practical Guide: 2015, Figure 7-7: Comparison between Management by Objectives and Hoshin Kanri
The Improvement Prioritization Process
2013 – The Karen Martin Group, Inc.
Focus Here
X Matrix – Example
Colors are used to differentiate various levels of deployment
Operational Excellence Consultancy: Hoshin Kanri Strategy Deployment
