HOSHIN KANRI

Introduction to Strategy Planning & Deployment

Make a connection:www.breakthrough-improvement.comwalshd@breakthrough-improvement.com

Contents and Agenda

1. Overview of the Strategy Deployment (SD) Process

2. Strategy Deployment & Breakthrough Objectives versus Business Fundamentals

3. 7 Step Strategy Deployment Process (Plan-Do-Check-Act):

A. Develop Strategy

B. Develop Breakthrough Objectives which drive attainment of the strategy

C. Develop Annual Improvement Priorities (AIP’s) with Targets and Resources

D. Deploy AIP’s

E. Implement AIP’s

F. Monthly Review Process

G. Annual Review Process

Strategy Deployment Process

OVERVIEW OF THE PROCESS

Conceptually….

Strategy Deployment…

• Fosters management to work ON the business, not in the business.

• Anchors into place a culture of learning and execution by fully adopting a

consistent Plan-Do-Check-Act methodology.

Engine of Execution: Plan-Do-Check-Act

Plan

◦ Identify where you want to be

◦ Capture where you currently are

◦ Clearly understand the ‘gap’

◦ Define steps to close the ‘gap’

Do

◦ Execute the plan

Check/Reflect

◦ Review execution status and understand ahead/behind

◦ Review results for understanding

Act

◦ Based on observations from Check/Reflect, establish any required course corrections and incorporate them into the Plan

What is Strategy Deployment?

The plan (which is above and beyond the annual budget).

A planning and implementation process which:

– Focuses on the achievement of (strategic) breakthrough objectives.

– Links breakthrough objectives with specific resources.

– Aligns resources within the company.

– On-going review of progress (PDCA).

– Results in specific action plans and measurements.

– Dynamic process: changes made when necessary

– Provides a means to communicate the vision.

Derived from Japan: Hoshin Kanri

“Ho” means Direction

“Shin” means Needle“Hoshin” means Compass

“Kan” means Control

“Ri” means Logic“Kanri” means Management Control

Hoshin Kanri means Control of the Organization’s Direction

Instead of reacting, we are navigating!

Strategy:

– Achieve Market Share Objectives by Becoming Counter-Cyclical

3 Year Breakthrough Objective:

– Penetrate Asian Market Place to Achieve $X of Revenue by 2006

Annual Improvement Priority Example:

– Reduce New Product Development Process

Target / Goal :

– Achieving Time to Market Improvement from 72 months to 18 months

Case Study – OEM Manufacturer

7 Phase Strategy Deployment Process

Develop Strategy

Develop Breakthrough

Objectives

Develop AIP’S, Targets,

Resources

Deploy AIP’S

Implement AIP’S

Monthly Review

Annual Review

Catchball

Lean

ToolsCounter-

measuresPlan

Do

Check/Reflect

Act

Perf

orm

an

ce

Business

FundamentalsBusiness

Fundamentals

Kaizen

Strategy

Deployment

Year 0 Year 1 Year 2 Year 3 Year 4

Business

Fundamentals

Business

Fundamentals

Business

Fundamentals

Kaizen

Strategy

Deployment

Kaizen

Strategy

Deployment

Strategic Objective

is Achieved!

Strategy Deployment Must be Focused on Results-Oriented Business Processes

(AIP’s are process focused actions to a problem)

Overview of Strategy Deployment

Kaizen = small, incremental continuous improvement

to the Business Fundamentals

Annual Plan

Process is: Result is: MBO Says:

Strategy

Deployment

says:

Bad Bad Bad Bad

Bad Good Good You got lucky!

Good Bad Bad Not Possible

Good Good Good Good

Strategy Deployment vs. Management By Objectives (MBO)

What Strategy Deployment Will Do

Force the clear identification of ‘how’ we move ourselves towards breakthrough objectives

Create an alignment of all facets of the organization on the key strategic initiatives (multi-functional teamwork)

Foster a data-oriented, fact-based culture

Reinforces the vision, but also clearly defines how we will get there (based on ‘who does what’).

What Strategy Deployment Won’t Do

Achieve results if the management process isn’t changed (Need to move to rigorous PDCA).

Achieve results if the ‘how’s’ (AIP’s) aren’t the right ones

Achieve results if the ‘how’s’ aren’t clearly defined

Replace the need for solid Business Fundamentals (also known as Daily Management)

SUPPORT STREAMS

Standard Training Courses

On Site Review + Bespoke Training

On Site Review + Bespoke Training + Transformation Support

Lean Business Partner

STANDARD TRAINING COURSES

Lean Thinking

Strategy Deployment (Hoshin Kanri)

Lean Daily Management Visual Management

Standard Work

A3 Problem Solving

Improvement / Transformation Value Stream Mapping

Kaizen

Change Management (ADKAR)

Lean Green Belt

Make a connection:www.breakthrough-improvement.comwalshd@breakthrough-improvement.com