Glossary for (Japanese) Continuous Improvement Language
What is ‘Hoshin Kanri’ (Policy Deployment)?
‘Ho‘ means method or form.
‘Shin‘ means ‘shiny needle’.
‘Hoshin’ could be best translated as the equivalent of our ‘compass‘
‘Kanri’ could be translated as: Planning or Management
Hoshin Kanri: a methodology for setting strategic direction
Hoshin Kanri is commonly translated as ‘Policy Deployment’, ‘Strategy Deployment’ or ‘Goal Cascading’.
Cascading companies goals to all levels
Hoshin Kanri cascades, or deploys, top management’s vision into policies and targets down to each management-level in the hierarchy. At each level, the policy is translated into policies, targets and actions for the next level down.
When Hoshin Kanri is correctly done, the companies vision will be translated into a set of understandable, coherent, consistent and attainable policies and actions for each level and in all functions of the company.
Set and translate Vision
Hoshin Kanri starts with the top management that sets the overall vision and the annual high-level policies and targets for the company. At each level down, managers and employees participate need to translate what this means to their annual targets, and the strategy and detailed action plan they will use to attain their targets. Each level also defines the measures that will be used to demonstrate that they have successfully achieved their targets.
Cascade down the levels
Each level that went through this process, in turn passes on targets to the next level down. Each level that passes down the requirements that are needed to achieve its goals, makes sure that the combined proposed goals and strategies of the lower level corresponds to the requirements.
Execute, review and report on each level
Each level manages its own part of the Hoshin plan and performs a regular review; reporting to the higher level the progress and problems, and to initiate corrective action.
Hoshin Kanri ensures that everyone in the company is made aware of the overall vision and targets (WHAT needs to be achieved), and the way that these are translated into specific requirements for their own behavior and activities. This allows everyone the freedom to decide HOW to get it done (within the limits of the given strategy)
Result of Hoshin Kanri
Hoshin Kanri/Policy Deployment is a method that increases the effectiveness of your organisation.
Deploying goals adds focus and balance to the company’s objectives by meeting the needs of all stakeholders such as customers, employees, shareholders, suppliers and the environment.
Hoshin Kanri/Policy Deployment limits the number of objectives and improvement projects and prevents internal inconsistencies.
Hoshin Kanri/Policy Deployment strengthens mutual understanding and alignment, establishes commitment for the company’s objectives and the necessary means.
One method on all levels
Hoshin kanri operates both at
the strategic planning level, where high level vision goals and strategies are being set as well as
the daily management level, where it addresses the more routine aspects of business operations
This is where the power of Hoshin Kanri shows: the same tool is being used from top management down to the shopfloor. At all levels it will result in clarity about everyone’s contribution to the team’s and company’s objectives. At the same time Policy Deployment is an ideal reporting structure.
Policy Deployment is a structured step by step approach, starting with setting and cascading the company’s objectives, planning and executing the implementation of specific improvement projects on the shop floor and evaluating and reporting the progress.
Results of Policy Deployment
Hoshin Kanri is a Plan-Do-Check-Act (PDCA) cycle
The Hoshin Kanri process is performed as a PDCA cycle:
In the ‘plan’ step, a plan of action is developed to achieve the organization’s goals
Milestones and corresponding control parameters are created.
The plan is reviewed and agreed.
In the ‘do’ step, the plan is implemented.
Actions are executed.
Strategy and Conditions are monitored
In the ‘check’ step, information is collected on the control parameters.
Teams/levels compare the actual results to the expected results.
The results are analyzed
Problems, needs and learnings are reported to the higher level
In the ‘act’ step, causes of any differences between expected and actual results are identified, discussed and agreed.
Corrective action is identified and taken to meet up with delays.
Learnings (negative as well as positive) are converted in new ways of working
New standards are set
Plan is adapted where needed
The Hoshin Kanri approach targets organisation system change
Measures the organisations system as a whole
Starts from setting core objectives of the organisation, cascading down to the individuals in the organisation
Needs understanding of the environmental situation in which the organisation operates
Needs understanding of the processes that make up the system, and their activities, goals, and metrics
Leads to providing resources to perform activities to achieve the organisation’s objectives.
Hoshin Kanri/Policy Deployment assures that:
Objectives are unambiguous.
Actions necessary to achieve the objectives are clear.
Each person in the organization knows what his or her contribution will be in achieving the organisation’s objectives.
There is insight in whether the progress of improvements is according to schedule or not.
Only projects supporting the objectives are carried out.
Monitoring and adapting the actions is possible, thus ensuring that planned improvements really lead to success.
Policy Deployment: from vision to reality
An important tool in hoshin kanri is the x-type matrix. In the video below using the x-type matrix in hoshin kanri is explained: