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Hoshin Kanri – a strategic planning and deployment tool

Published by CME Manitoba on March 15, 2018

Time and time again, CME hears from organizations about the roadblocks they encounter with their traditional strategic planning process. Traditionally, strategic planning can be especially frustrating because so much time, effort and resources are allocated to the planning process with the very best of intentions. And yet the result is a plan with too many priorities, insufficient details and a lack of active review.

 

The solution? Hoshin Kanri

Hoshin Kanri is a Japanese term for policy deployment. Hoshin, meaning “methodology for strategic direction setting’ and Kanri, meaning “management” or “control” combine to create a process for deploying and sharing the direction, goals and approaches of corporate management from top management to employees and for each unit of organization to conduct work according to plan.

A few common, ‘diagnostic’ tests can help determine if Hoshin Kanri might be right for you. The system works best for organizations that have noticed a trend of project failures, long lead times for improvement, missed budgets versus forecasts and a corporate vision that does not match organizational activities.

 

Why Hoshin Kanri?

Hoshin Kanri provides a step-by-step planning, implementation and review process for managed change. It integrates and encourages cross-functional cooperation to achieve breakthroughs and provides a planning structure that will bring selected critical business processes up to the desired level of performance.

In traditional strategic planning, the executive team defines and cascades goals usually based on financial metrics. Accordingly, there is often a departmental interpretation of priorities and disconnect with purpose. Executives then, mostly collaborate with the strategy function and then deploy it to line management. The process to address problems is left up to individual initiative and methodology, employee development is structured but not connected to work or business goals and strategy expertise concentrated mostly in the strategy function.

Under a Hoshin Kanri approach, organizational plans are developed using both top down and bottom up perspective – and looks at both process and results. This provides a common understanding of priorities that connects each person to purpose and allows executives to collaborate with line management to determine direction. The approach follows LEAN principles and incorporates a scientific and structured approach to problem solving. Hoshin assignments are designed as developmental opportunities linked to the business and strategy is driven by collaboration between line management and senior executives and supported by the strategy function.

 

Hoshin Kanri and CME

As your organization heads into strategic planning, ask yourself if the symptoms of planning failure outlined earlier in this article apply to you. If so, you may be ready to consider Hoshin Kanri. Connect with Erwin.matusoc@cme-mec.ca for more information, today!

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