Hoshin Kanri, like a lot of the Lean Management methodologies, is a Japanese term and, simply translated, Hoshin means 'Direction Needle', or Compass, and Kanri means 'Control Logic'. Therefore Hoshin Kanri is a methodology for the Logical Management of the execution of the Organisation's Strategic Direction.
Hoshin Kanri follows the PDCA cycle in its approach over an annual cadence, with typically a 3-5 Year time-horizon and, in the Planning phase, the major differences between Hoshin Kanri and a typical approach to the deployment of strategy are two-fold:
1. Decisions are actively made on what to do but, most importantly, which of the many opportunities the organisation will NOT do.
Companies that adopt Hoshin Kanri accept that having too many priorities is the equivalent of having no priorities and that some opportunities will have to be sacrificed; not because they are not good initiatives but because the organisation simply doesn't have the resources to do them: Other things are more important and focus is required to do them well.
2. The answer to how the Strategy will be delivered is delegated to the appropriate level of the organisation, through a process called 'Catch-Ball', meaning that those people who will need to deliver are also empowered to determine the best way to deliver. They also get to provide input on item 1, to ensure that the decision made on priorities is the correct one.
As you may have implied from this, the planning phase typically takes longer than it would in a traditional approach and is very thorough and inclusive, with the Strategy creation and targets initially set at the top level of the organisation but a great deal of the 'how to achieve' determined at the appropriate level of the organisation through the iterative approach. However, what this thorough planning allows is rigorous discipline once the organisation moves into the Do, Check and Act phases of the cycle.
This leads to the second question posed: Why isn't my Organisation utilising its Power?
This isn't easy to answer, as the 'case for change' should be clear enough:
However, clues as to why not are in the above statistics, with the fact that most companies don't track performance against plan meaning that they will not realise how badly they are executing their strategies, which is borne out by the fact that 90% of companies don't execute well. As around 86% of Executive Teams spend less than one hour a month reviewing strategy, they would appear to be more involved in the 'day-to-day' problems of the business than they are in steering the future direction. Given this, it is hardly surprising that the Leadership of most Organisations don't take the time to implement a Methodology that would ensure excellence in their Strategy Execution.
There are a few large organisations for whom Hoshin Kanri is a clear and integral part of how they consistently deliver breakthrough performance through the execution of their strategy. However, I have also seen a number of smaller organisations prospering via this approach and the clarity that it brings for the Team Members is great to see. Most importantly, it significantly reduces the overburden and feeling of a lack of direction which a lot of Employees feel.
In my experience, Hoshin Kanri is the missing 'secret' Ingredient for most established Organisations to cut-out misalignment, match resources and capability to Strategic Intent and to ensure excellence in the delivery of the Strategy into real Business results.
"I aim to promote the global sharing of best practices in the application of Lean Thinking."