Don't waste time on Strategy Deployment

Get it right 'First Time Through'.

We have a lot of experience implementing Strategy Deployment (Hoshin Kanri / Policy Deployment) from scratch.

I've done this in organisations like Smiths (Detection) and I've seen others going through the process of implementation, up-close and at a distance, in 3M & Phillips for example.

I've also seen others trying to create their own versions, and rules around it. People often ignore the wisdom that sits behind it. They subsequently shoe-horn it into their own world-view (& comfort zones) damaging the models efficacy in the process.

They do this ignorant of the socio-systemic psychology and neuroscience 'issues' missed by many popular strategic alignment models and methods, which Hoshin addresses in it's original design.

They fail to see they are acting in their own interests rather than adapting to something new. This is understandable of course, because it's a complex subject, but where people put the effort into it and understand the principles and, why they work, fully, it can unlock enormous potential throughout an organisation.
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On the flip side, failing to see these depths is a sure-fire way to get the top level matrix populated poorly and implementation wrong from the start.

Now, I've seen many articles around the subject of Hoshin implementation and they all followthe standard, 7 steps, Set vision etc. ... but don't really get into any of the nitty gritty you need to know to get it right.

To that end, I thought I'd share a little insight through experience.

There are a number of key aspects that have highlighted themselves to me over the many years i've spent teaching it to boards of Directors and implementing it across organisations and departments, in large and small organisations alike.

Here are a few 'Essentials' to take away.

1. The Executive leadership team and the senior management team MUST ALL see it as the framework by which they will run the company. It has to replace existing strategic models and most importantly *mindsets* (i.e. A thorough understanding and a strong belief / conviction that it works is essential - there is no room for doubt). Anything less and it will fail to be sustained and WILL NOT deliver the results it otherwise could. This makes the initial introduction of the model and principles the key to failure or success . A CEO who is too busy to spend the time attending the development stages, a manager who sends a representative to take his place at a department session or a consultant who can't stick to the principles in the face of opposition from the uninitiated will all result in future pain and the chance it will fall over - there has to be complete understanding of 'Purpose' and complete commitment for it to work.
2. It MUST be understood, that any typical 'Drivers' (Fiscal targets, ROCE, ROI, EBITDA etc.) become the 'benefits' (the outcome) and DO NOT feature as a driver.
3. There MUST ONLY EVER be 3 (three) 3-5 year objectives (Any more and the model generates too many annual initiatives for the department heads to resource and address sensibly).
4. In manufacturing environments those 3-5 yr objectives MUST be time based (because people can directly associate to the responsibility of doing things faster, but they don't easily associate to their actions as having an impact on the bottom-line). This ensures they can have a closer 'connection' to the purpose of the 2nd level action plans that Hoshin generates.
5. In manufacturing terms, you DO NOT have to reinvent the wheel - the three time-lines Toyota developed are sufficient and reflect '7 Wastes' reduction in terms of organisational time-lines (i.e. the capacity to respond through effective efficiency). They are 1. Raw Material to Finished Goods 2. Concept to Launch 3. Order to Cash.
6. In service environments, public sector, sports clubs etc. (I know this as it's how I got a Gymnastics Club their GymMark approval from British Gymnastics), you have to understand the 'principles' behind these time-lines and convert them into equally broad and all-encompassing organisational time-lines that can be reduced / improved by front-line action & development.
7. The work really starts when you determine how you will measure the annual initiatives required to address these 3-5 year time based improvement requirements.
8. It gets incredibly challenging, when you try to keep direct KPI association between annual initiatives (organisation wide) and the 2nd level department initiatives. This often requires you change the annual initiative KPI's. This part of the process (7&8 combined) equates to 'Going to Gemba', i.e. trusting and listening to (and hearing) the 'Experts' (The people who do the work). It is this step that finalises the element of Hoshin Kanri, that Danaher called 'Catchball' .. once the 'experts' have a voice, it often leads to a re-think and a change to the initial ideas around 'Annual Initiatives'. If the leaders involved in the process want ownership, buy-in, empowerment etc. from the workforce - this is an essential step to get right ... it is a turning point in a companies culture ... and how it's done will reflect the commitment to the Executive teams core values and organisational philosophy.
9. Once established and visually managed throughout the organisation (another Key aspect that cannot be misunderstood at a psychological level and subsequently buried in a computer), it's important to provide the coaching and on-going support the department heads and other leaders will require. It's not something that falls into place over-night - we're dealing with people change ... and that requires new neural connections are generated and new principles adapted to ... there's only so much re-wiring the brain can do in any given time-frame, so people need to get the support required to allow their brains to 'Let-Go' of old comforts around previous methods and build new comfort zones and habits (i.e. new neural connections in their brain) around the new method and approach.
10. The result - Monthly 'Stand-up' review at top level with all key stakeholders, to identify and discuss what's worked, what hasn't, what is on track and what is not, weekly action plan updates per department to respond to improvement shortfalls (directly linked to strategic intent), constant presence of progress, visually manged and understood by all, the potential for allocated actions to feed performance assessments per person / department, everything connected (dealing with SF&OP type issues without a separate / distinct process required), in language all can understand across all layers and all departments within the organisation ... Done well, this can become the bedrock of rapid and sustainable improvement ... done wrong, it becomes just another 'Tool' from the Lean toolbox that will get the blame if it fails.

This is why Lean purists and Toyota say you can't do Lean without Hoshin.

In the absence of such coordination for waste elimination, we end up with sayings like 'Kamikaze Kaizen' seeing people make waste activities efficient, because they are dealing with improvement activities within silo's, detached from the bigger picture, Hoshin provides that cohesion and all-encompassing effectively communicated view, so such wastes are avoided.

There are other things you can do to help Hoshin become ingrained as 'just the way we do things around here' ... like colour coding the resources (departments) and putting them on a map, to help everyone understand the 'internal customer relationships throughout the organisation.
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In relation to the example in the picture above, we created a 'Tube-map' of the different departments and colour coded their timelines (+ Start Stop points) to allow each function to clearly understand their interaction points with other departments.

This was not understood prior to our involvement leading to a silo mentality which saw the majority of actions taken in the interest of satisfying departmental performance over and above organisational performance (i.e. to make the job as easy as possible for those involved, irrespective of the damage it did further down the line).

Visualising it like this allowed us to build a strong sense of the 'Internal voice of the customer' (And put in place some SLA's to help new mindset's embed to a higher service standard).

​It also allowed us to remove KPI conflict - which is where KPI's drive actions in one department which conflict and undermine performance in another department (Sounds ludicrous, but it's incredibly common!) ... this was all part of getting the KPI's aligned across the departments and hierarchical / cultural layers of the organisation ... such in depth development was driven by the commitment to pursue a Hoshin approach.

We also provided the company with a 'Road-Map' clearly detailing the Initial, Fundamental and Mature stages of organisational development in terms of Man, Machine, Method and Materials ... showing which Lean tools are typical and useful, as a company advances within these themes and streams.

In my view, Hoshin Kanri and all it entails is essential if an organisation wishes to become truly aligned in terms of their narrow and deep day to day actions complimenting their broad strategic intent. You can consider it 'Lean', or just common sense (not very common unfortunately).

Whichever banner you put it under, I hope the observations I've offered here help to deliver more of an insight to challenges and benefits that accompany a Hoshin approach than the typical 7 step models do.
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