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David Meier

David Meier: Hoshin Kanri is Direction Management

By David Meier, - Last updated: Saturday, April 27, 2013 - Save & Share - Leave a comment

I am sure someone else will mention that Hoshin Kanri is more specifically translated as “Direction Management.” Within any language there are words that describe conceptual aspects in a culture and are not directly translatable because the other language does not have the same exact thing. Hoshin is one such concept. It is a process and it is intended to get a group of people aligned around specific targets. It is SIMILAR to Policy Deployment or Management by Objectives so sometimes that is what it is referred to, but there are significant differences in HOW Hoshin is applied.

I don’t know that there are prerequisites to Hoshin (such as no silos, or all people working in the same direction). After all, Hoshin is a PROCESS (the X Matrix is a tool) to help get alignment around company priorities and to develop strategies (approaches to achieve the targets). The thing I see that every company outside of Toyota (US and European companies-I have not seen other Japanese companies so not sure on them) is they make the same mistakes that people make in the problem solving process. Namely, they jump straight to solutions rather than identify a strategic approach for HOW to get to the target.

For example if the 3-5 year target is to expand sales in a new market, the one year “strategy” might be “Increase the number of sales people in the region.” This is essentially an answer and not a strategy. We need to think of Hoshin as a PDCA process where we identify a need and then develop a plan of attack, then as we execute the plan, check to see if things are on track to the plan and if not make necessary adjustments. The Hoshin plan would only show a brief description of the main point of the plan. Instead of identifying a specific answer (add sales people) the Hoshin should be something like “Target specific customer type” (with the detail of the potential customers- by region, certain products, direct or through distributors, etc.).

Hoshin, like all of the lean processes and tools is a process (with tools) used for problem solving. It begins at a higher level with rather generic expectations, but the objectives are cascaded down to the level where the actual work takes place, and specific activities are identified that will contribute to the higher level target (results roll up). If the leaders target the need to enter a new market, that target is passed to the actual sales team to develop the specific strategies and plan for getting to the target. The proposed plan is passed back and forth (catch-ball) until there is agreement on the plan of attack.

What I see in companies who use Hoshin is the top leaders set the targets and then also specify the plan to get there (actually just answers rather than an actual plan which is a mistake) and then pass it down to the next level to execute (another mistake). This totally misses one of the main the points of the Hoshin process and that is to get alignment between all parties toward a target, and for people closest to the issue to be responsible for defining how they will achieve the target. One thing is for sure- getting a team (company) aligned is certainly not an easy task!

It is important to make a distinction that the “problems” identified in the Hoshin are typically considered “created” problems meaning there is not necessarily a current problem in an area, and therefore, there no causes to find to solve the “problem.” Hoshin targets are typically akin to trying to achieve something new (though sometimes something is currently broken and needs corrective action). By nature created problems offer a unique challenge because they involve things that we have not done before (like planning a vacation trip). These targets typically follow a PDCA type process more than the usual cause analysis (5-Why) approach to solving them. When we plan a vacation trip we don’t ask “Why have I never taken a vacation to this place?” We ask, “What are the parameters that I need to work within?” In other words- how much time do I have to get there and back, and what then are the options around what I can see and do during that time? As we start our journey we may find that what we thought would happen didn’t and we need to adjust our basic plan for the trip. We still need to get to the destination on time, so what would need to change in the trip? Actually during the Do phase we are executing a short repeated DCA cycle. We are constantly checking and taking small steps forward and evaluating the result. If it is working according to plan (actually not a likely event), keep going and expand. If not, then reevaluate and develop a new plan of attack and begin to execute (and quickly do the CA cycle).

In the case of created problems though, it is not that something similar to the challenge at hand has never been done before. It is possible to go back in the past and evaluate similar efforts and determine a plan based on past experiences. If we want to enter a new market it is not something that has never been done before and it is possible to consider other efforts. Even if it is a totally new thing (a rare event) there are incremental steps possible. Consider the process of putting a man on the moon. That was a perfect example of PDCA. The first thing was unmanned flight and orbit. Then, a dog or monkey was put in orbit, and finally a man went into orbit. The first Apollo mission did not put a man on the moon. Each successive flight was a test of the next level to gather information and develop new processes based on what was learned in previous efforts.

Because the “problem” is of the created nature leaders often get confused between a need and target, and the specific outcome. In other words the difference between the desire to enter a new market and the actual details (sell X amount of a product to Y customers). It seems leaders think they are supposed to have the answer so they pull something out of the air and put it on the X matrix rather than let the team develop the specific plan.

In summary Hoshin is a challenge because people tend to jump to solutions and typically are not skilled at the PDCA thinking process. I would not advise using the Hoshin process (and tools) until leaders can learn to set effective targets (which means they need to be able to define business needs without the answer) and the team learns to apply PDCA effectively. If these things are not present Hoshin just becomes a modification of what tools are already in place to set targets and goals, and adds no value.

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