Learning material

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Hoshin kanri, OKR and Balanced Scorecard - learn which strategy implementation method is best for you:

Hoshin kanri

OKR

Balanced scorecard

Description

Goal-setting framework which combines long term objectives with annual objectives and improvement priorities with KPIs.

Alignment process to reduce waste and to ensure common direction.

OKR is a goal-setting framework which consists of objectives and key results.

Measurable goals create alignment.

Strategy is formulated using 4 perspectives: finance, customers, internal processes and learning & growth.

Aim to balance financial and non-financial KPIs.

Orientation

Change and performance

Growth

Performance and operational management

Principle

Tiered according to organizational level

Focus on teams

Business unit focus

Strategy horizon

3–5 years and focus on annual planning.

1 year. Focus on 90 days.

More than 1 year. Focus on annual planning.

Pros

  • Strong alignment across organizational levels.
  • Forces maintaining of focus & clarifying ownership.
  • Simple strategy visualization.
  • Fast pace
  • Relatively simple.
  • Aligned to roles in the organization.
  • Taught widely in universities.
  • Efficient in describing metrics of corporate strategy.

Cons

  • Perceived as a demanding method due to its lean roots.
  • Support for very short-term goals.
  • Easy to end up with too many objectives
  • Alignment in large organization
  • Limits corporate strategy to a set of KPIs
  • Easy to lose the bigger picture.
  • Cascading down the objectives lacks precision.

Best suited to

Companies where internal cooperation and alignment are important.

Companies where the need for internal alignment is low.

Companies with simple organizational structure.