A person can have the capability and the stamina to run the distance but if he is not running in the desired direction, he cannot reach the destination. The same applies to all business endeavours.
To aligning activities with Company Startegy in Japanese is known as HOSHIN KANRI. The meanining comes from the words
- Hoshin = Japanese for Direction Needle, equivalent to a Ship’s Compass
- Kanri = Japanese for “Control” or “channeling into reason or logic”
The reference of the combined word is to a fleet operation, where a compass is distributed to many ships, properly calibrated and direction defined, such that all ships, through independent action arrive at the same destination as required by the fleet commander.
The appropiate English translation of Hoshin Kanri is – Policy (or strategy) deployment. Once the company has a Comprehensive Corporate Vision, Purpose (Mission), and Goals, the top management translates this, into a set of understandable and attainable targets. The deployment of these targets to focussed measures that can be applied at all levels of the company and in all functions is Hoshin Kanri. When these actions and policies are applied all the way down the line, they result in a vision becoming a reality – a major, continual improvement in performance.
The key to success of this management tool is “Alignment”, “Focus” and “Engagement”. It is necessary to align, focus all improvement activity to the company goals and achieve full engagement of all employees in achiving them.
It has been found that not all the improvement projects conceived, start with company’s overall needs in focus. They are often instigated by departmental problems or local leadership themes. However, if the change has to be meaningful, the thinking process, must start with first identifying the gap that is existing between the current state and the targets. The shortfall is then evalluated in terms of significance (or importance) and magnitude. If the efforts to change are to produce financially significant results, the improvement projects, which reduce the Gap in the shortest possible time, have to get priority,
The Policy deployment process identifies the parameters in which the goals and the current state can be measured on the same scale. The change in parameters must be correlated with the actions and the result confirmed by the PDCA cycle.
To be sure that the goals are understood by everyone, objectives for each level and each department must be defined in quantifiable “numbers” that have to be met for the whole company to achieve its targets.
They must also understand how their individual projects link to the ultimate goal. This makes the project more meaningful and participants put in more than normal effort to succeed.
The tool is used at multiple levels within the Company and each level is developed from the level above. The process includes a simple reporting procedure that gives simple visual management to evaluate progress.
Policy Deployment (Hoshin Kanri) is a Management Tool used to
- Prioritize action areas to ensure that the focusing is on those areas or gaps that will impact the overall goals the most.
- Provide clear measures to judge how each action is impacting “closing the gaps” on the goals
- Allow each individual being called on to contribute, to link his efforts to the top level goals of the Company
Acknowledgement: Vijay Rai – Associate Director, Kaizen Institute