Discover how to use the Hoshin Kanri planning process to set and achieve business goals.
Updated 25 Nov 2022, Published 27 Jun 2022
Hoshin Planning Process is a method businesses can use to set and achieve strategic objectives. The goal of the process is to develop a shared vision and set of goals that can guide the organization's decision-making. The entire organization participates in a brainstorming session where ideas are shared. These ideas are then compiled and used to create a mission statement. From there, the organization develops a series of objectives to help it achieve its mission. The Hoshin Process effectively ensures that everyone in an organization is working towards the same goals.
Hoshin Kanri‘s planning isn’t limited to top-down implementation. It features built-in continuous improvement procedures, essential to ensuring the method’s success. These are Catchball and PDCA, two of the process tools.
The Hoshin Planning, as previously said, is a top-down approach. It is a collaborative effort between a manager and a subordinate who must agree on the best set of goals. If managers push people into accomplishing particular business objectives without obtaining feedback, they risk demotivating them and overlooking critical details.
The advantage of communicating the objectives with the people working on them is that they will consider the specifics more thoroughly than management. In practice, this is what Catchball is all about. Having well-communicated, realistic, and agreed-upon goals is critical for fostering ownership and enthusiasm, establishing a beneficial feedback loop, and increasing execution quality.
The Deming Cycle is a method for improving quality that Deming first conceived as a continuous improvement method. It has four stages:
The PDCA approach, which is a scientific method for continuous improvement, necessitates the use of some specialized techniques:
The greatest problems that large corporations face are misalignment and human resources, where hundreds of employees do many different tasks every day. Small businesses may also struggle, where work is much more rapid, and the big picture may get lost.
If implemented correctly, the Hoshin Process compels the leadership team to establish a vision. Setting breakthrough goals encourages a cascade of collective goals and provides the necessary leverage to achieve success. To put it another way, Hoshin Kanri bridges the gap between strategy and execution by promoting alignment and concentration.
The Hoshin Kanri process utilizes a template called the Hoshin X Matrix. The template visually depicts the relationship between objectives, strategies, and tactics. The X matrix is a powerful tool for tracking the progress of an organization’s Hoshin Kanri implementation.
Below is what the X matrix looks like.
Hoshin Kanri X Matrix
And here’s what it looks like when it’s filled in:
Example of Hoshin Kanri X Matrix
Mapping everything on the X matrix allows you to see the big picture and understand how each tactic contributes to the overall goal.
Setting your yearly strategic goals is generally when the Hoshin Matrix comes in. The X matrix aids in goal deployment planning. By establishing alignment and focus, the Hoshin Matrix will connect strategy with implementation by eliminating the gap.
The X matrix may look too complex, especially to those who have never heard of Hoshin Kanri, but it is quite simple. A Hoshin Kanri X matrix is a one-page document that outlines objectives, tactics, significant projects (initiatives), and owners. Each quadrant includes the following:
It describes your long-term objectives supporting the company’s overall policy or directional shift. Long-term goals set a standard for where an organization wants to go.
Establishing long-term goals involves asking: ‘What do you hope to accomplish this year?’ There is an intersection between long-term and annual goals.
It expands on the various tasks you want to perform each year to meet your annual goals. Switching to energy-efficient lighting, or establishing a cycle-to-work program, are examples of activities at the intersection of the matrix.
It establishes numerical goals to achieve the top-level goals. As a result, organizations strive to meet these targets within a year, allowing them to keep track of which priorities influence which targets and whether any plans directly relate to the long-term goals.
The people assigned to execute the specified activities/goals are on the diagram’s far-right side.
Lastly, the X matrix template illustrates the relationships between the activities within each section.
The Hoshin 7-step process, which aims to bridge the gap between strategy and execution, has the following structure:
The first step is to establish a shared vision for the organization. It involves creating a mental picture of where the company wants to be in the future. It uses the following questions as a guideline:
Define your three- to five-year breakthrough goals next. Then divide these objectives into components depending on your company’s structure. For example, if your company has a facility in North America, Europe, and South Africa, the three- to five-year goals must be divided into objectives for each geographic region.
It may also be possible to divide your company into functional departments like production and quality. In this case, break down your 3-5 year objectives for each team and communicate them to the team managers.
Plan your next 12 months to ensure you meet your 3-5 year goals. Suppose you want to introduce a new product in the next three years. This year, your goal may be to finish a market research study and define product requirements.
Use the catchball technique to communicate with various parties in an ongoing exchange of information regarding what it will take to achieve specific goals. Assign department, team, and individual objectives once you’ve determined what you need to accomplish in the year.
As you go through your monthly and annual objective reviews, you may discover that you’ve missed some of them. Prepare to solve issues to fulfill missed targets. Create a Plan-Do-Act-Check approach to identify and remove any obstructions preventing you from achieving your goals.
Companies frequently overlook this step, and the Hoshin Kanri process helps avoid this error. Conduct monthly reviews to ensure the project’s progress is on track. Make a plan for checking in on progress every month. Begin by creating personal evaluations first. Then create a project and team-wide/departmental review procedures.
After the yearly cycle, a comprehensive examination of the year’s goals shows how far ahead or behind the organization is in achieving its stated objectives and how to move forward.
Step back and think about what worked and didn’t work during the process. The goal is to assist your company in moving forward on future breakthrough goals.
Eliminate manual tasks and streamline your operations.
After we’ve looked at the advantages of Hoshin Kanri, it’s time to take a step back and look at some of the disadvantages.
The most significant disadvantage of Hoshin Kanri is that there is no room for error. This planning method requires a high level of commitment from everyone involved.
Another disadvantage of Hoshin Kanri is that it requires a lot of time and resources to implement correctly. Small businesses with limited resources may not be able to implement it properly.
Hoshin Kanri can also be inflexible, making it difficult to adapt to changing circumstances.
Not everyone in the organization may be in favor of the Hoshin Kanri planning process. It can make it challenging to get everyone working towards the same goal.
For some people, the Hoshin Kanri planning process can be overwhelming. There is a lot of information, and it can be challenging to see the big picture.
If you’re planning to use software for Hoshin Planning, you should ask yourself whether it can handle the Hoshin X matrix. As described earlier, the Hoshin X matrix is a one-page visual of your objectives, measures and targets, measure programs, and corrective action items.
Your software should allow you to input this information and generate a visual representation. It will help you see the big picture and ensure everyone is on the same page.
A software solution should also make it easy to update the matrix as things change. After all, Hoshin Planning is an ongoing process, and you’ll need to be able to adjust your plan as your objectives, measures, and targets change.
Finally, you’ll want to ensure that the software you choose is easy to use. The last thing you want is your Hoshin Planning process to be bogged down by complicated software.
SafetyCulture is a versatile audit platform ideal for Hoshin Planning. With SafetyCulture, you can create custom templates to input your Hoshin X matrix information. Moreover, here are some other benefits of using SafetyCulture for Hoshin Planning:
The Hoshin Planning process could be a bit overwhelming, especially for those new to it. Thankfully, EdApp turns complex topics like Hoshin Planning into a simple, interesting, and engaging learning experience.
What's so great about EdApp is that it has hundreds of free, regularly updated courses in its library that cover everything from Lean Manufacturing and Six Sigma to Project Management and Change Management. Better yet, it allows you or your team to learn on your terms to promote life-long learning.
Rob Paredes is a content contributor for SafetyCulture. He is a content writer who also does copy for websites, sales pages, and landing pages. Rob worked as a financial advisor, a freelance copywriter, and a Network Engineer for more than a decade before joining SafetyCulture. He got interested in writing because of the influence of his friends; aside from writing, he has an interest in personal finance, dogs, and collecting Allen Iverson cards.
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