Hoshin Kanri is a strategic planning method that combines long-term strategic objectives with actions to be taken to achieve them (development projects) and metrics that ensure transparent follow-up of strategy implementation. The Hoshin planning method effectively aligns the organization toward common objectives. It was developed in Japan and means” direction” and ”management.”
Hoshin Kanri (sometimes also called Policy deployment, Strategy deployment, or Hoshin planning) is a strategic planning and execution management method. It is often associated with lean principles and is usually used in organizations that have already applied some parts of lean methods, e.g., in their production.
Typical elements of the strategy are shown in the picture below. The areas covered by the Hoshin Kanri method are marked green. It is a typical misunderstanding that Hoshin Kanri is a method used only in drafting a strategy. Hoshin Kanri is the operational part of the strategy, linking strategic long-term objectives with annual objectives and strategic projects with KPIs. Strategic planning also covers the important phases of alignment within the organization. Besides strategic planning, Hoshin Kanri’s management process enforces transparency and continuous learning. In the execution phase, the management process and behavior focus on deviations from the plan. One of the key terms often associated with Hoshin Kanri is “Learn to plan.”
Hoshin Kanri often utilizes an X matrix that visually connects long-term objectives, activities and metrics. Organizations where staffs’ work can be directly linked to strategy are more successful and witness higher commitment of all organizational members.
Hoshin Kanri is a layered management model where a each team prepares own objectives and in particular chooses small amount of activities that help them to reach objectives. Focusing on only a few breakthrough objectives at a time and ensuring that actions related to the objectives get a sharpened focus on action.
In Hoshin Kanri, dialogue, or “catchball” within an organization, helps to align goals and actions in a common direction. Thru this process, potentially conflicting goals are easy to spot. Moreover, each team starts owning clear goals that are linked to the corporate strategy; everyone becomes aware of colleagues’ efforts. Such transparent management model engages and motivates staff and helps to maintain self-direction.
With Hoshin Kanri, effective day-to-day management principles can be easily extended to the entire organization. The method does not force a particular way of leading, but nevertheless provides a good basis for effective leadership.
What gets measured, gets done.
Hoshin Kanri is a strategic planning method that is used by many successful companies: Tesla, Toyota, Caterpillar, HP and Bank of America. In addition, many hospitals, municipalities, and other public organizations are already utilizing this effective method of strategy management.
Hoshin Kanri helps large organizations reach a common direction and increase cooperation, however, even smaller organizations benefit from an easy way to visualize strategy and ensure prioritization of actions. The management system, transparency, and enhanced cooperation of the organization support the commitment of the staff.
Every organization can benefit from Hoshin Kanri even if an organization has pre-existing management structures or a strong organizational culture.
From this blog, you can study if the Hoshin Kanri method would be suitable for your organization.
A growing number of organizations have recognized the benefits of the method in implementing the strategy and therefore the use of Hoshin Kanri is increasing at an accelerating rate.
We’ve been using the Amplon X-matrix tool for our 500-person organization over the past two years. It has significantly enhanced clarity. Now, we have an easily accessible clear view for everyone of our long-term goals, annual objectives, and development topics both at the organizational level and within each activity.
While we’ve only scratched the surface of its functionality and potential, the tool’s intuitive interface, speed, and ease of use have been impressive. One of its standout features is the natural periodic check-ins it encourages, prompting our management team to engage in thorough discussions regularly.
Moreover, the Amplon team’s responsiveness and support have been outstanding. Overall, Amplon X-matrix has been an invaluable asset for our organization.
Ari Hyvärinen
ABB Drives Oy
Amplon uses the Hoshin Kanri principles to engage all employees and to visualize the strategy. Read more about Hoshin Kanri’s 3 basic elements. The X matrix is a powerful strategy visualization and Amplon is X matrix software that combines strategic planning, project portfolio management, and performance management.
With Amplon companies can design a bottom-up strategy and can easily adapt this software to their culture and processes. Amplon makes it easy to share common development projects and activities, ensuring focus in the organization. Instant monitoring of strategy through software dashboards allows immediate reaction to any deviation. Read why you should implement hoshin kanri with software.
The “Ultimate Hoshin Kanri X Matrix Guide” provides an in-depth exploration of the X Matrix as a critical tool for strategic planning and execution. This guide details how the X Matrix aligns organizational objectives, improvement projects, and KPIs to ensure cohesive strategy deployment across all levels. With a focus on clarity and alignment, the X Matrix simplifies complex strategic processes into a single, visually engaging framework.
Hoshin Kanri software, like Amplon, revolutionizes strategic planning by using a digital X matrix to align organizational goals with vision and mission, ensuring transparency and collaboration. This approach offers real-time data updates and intuitive interfaces, making the strategic process more agile and efficient than traditional Excel tools.
The three basic elements of Hoshin Kanri—setting tangible objectives, aligning goals across the organization, and implementing a structured review process—are crucial for strategic alignment and continuous improvement. Understanding these core components helps organizations effectively achieve long-term success.
Comparing Hoshin Kanri, OKR, and Balanced Scorecard (BSC) reveals differences in how these frameworks align goals with execution. This article helps you to choose the right approach for your organization’s strategic needs.
What unites Toyota Way, Danaher Business System, and GE’s Flightdeck?
These companies have branded the Hoshin Kanri method as their management system.
