1. home and garden
2. home improvement and repair

Hoshin Planning
Process
Workshop
Month xx, 20xx
Agenda
2
- Introduction/Ice Breaker
5 min.
- What is Hoshin Planning?
2 min.
- Why use Hoshin Planning?
24 min.
- How to Use Hoshin
35 min.
- Questions and Answers
15 min.
- Example (tbd)
15 min.
- Wrap Up
5 min.
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What is Hoshin Planning?
Hoshin Planning
• Hoshin is a Japanese term = “compass needle”
- Designates setting strategic direction of the organization
• For HOS Hoshin is:
- A closed loop management system for identifying, focusing and linking the
organization to achieve results. Additionally it contains a daily management that
drives constant progress monitoring of these results and reacts to issues as they
arise
• Traces roots to:
- Management By Objectives (MBO) – Drucker
- Plan-Do-Check-Act (PDCA)- Shewhart/Deming
• Sometimes referred to as:
- Policy Deployment
- Management By Policy
- Management By Planning
• U.S. Based Companies That Have Embraced It
- Danaher, Hewlett-Packard, Proctor & Gamble, Xerox, Florida Power and Light
(FP&L)
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Why Use Hoshin Planning?
Why do we need Hoshin Planning?
• Why?:
- Proper alignment requires more than independent
establishment of strategies
- Hoshin Planning will align those strategies and drive the
execution
- To Achieve Breakthrough RESULTS!
• Common Failure Modes:
- No review of actions or accountability
- Plans not visible or not measured or measurable
- Not aligned or linked to the needs of the site
A PROCESS to help drive Results!
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Hoshin is an active relationship between 2 parts
• The two parts of Hoshin are…
- Hoshin Management
- Daily Management
• Hoshin Management (Strategies & Objectives)
- Special actions/plans are required to achieve a desired
result
• Daily Management (Routine KPI Management)
- Can achieve targets with usual improvement activity and
resources
Hoshin Has Two Sides
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Why Use Hoshing Planning?
Strategic
Objective
is
Achieved!
Improvement
Hoshin
Planning
KAIZEN
Hoshin
Planning
KAIZEN
Base
Hoshin
Planning
Base
KAIZEN
Base
Base
Year 0
Base
Year 1
Year 2
Year 3
Year 4
To Build Sustainable Competitive Advantage
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Why Use Hoshin Planning?
VS.
To Align Objectives and Targets
Throughout the Organization
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Daily Management
• Daily Management (Routine KPI Management)
- A visual management system to highlight day-to-day issues
that drives rapid implementation of countermeasures.
- A communication tool that drives alignment to the lowest
levels of what is important to the site.
- Strong linkage into the Visual Management and Leadership
Standardized Work systems at the site
Daily, Weekly & Monthly Monitoring of Progress
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Hoshin Planning Summarized
Both Controlled by Rigorous
Process Control Systems and
measured frequently to drive
results
Daily Mgt.
OBJECTIVES
Cash
Growth
Hoshin Management
All activities necessary to
carry out the routine work
for the SBU
AOP
QMS
People
STRAP
STRATEGIES
Defined to follow and be governed by…
Rapid Problem Solving methods
PDCA
Demonstrated through standardized work
On the shop floor
Controlled and driven through Leadership
Standardized Work in daily gemba walks
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How to Use Hoshin?
What Does Hoshin Planning Mean To You?
Top Mgt
Breakthrough
Middle
Mgt
Kaizen
Supervisor
Daily
Management
Front Line
Associate
Adapted From Beyond Strategic Vision, Effective Corporate Action
With Hoshin Planning; Cowley, Domb, 1997 pg. 57
How Should You Spend Your Time?
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Timing of Hoshin Planning
JULY
AUGUST SEPT
OCT
NOV
DEC
JAN
STRATEGIC PLANNING
HP LEV 1 COMPLETE
ACTION PLAN
DEV COMPLETE
HP LEV 2 & 3
COMPLETE
CONCURRENT BUDGETING PROCESS
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NEW
YEAR
HP
BEGINS
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7 Phase Hoshin Planning Process
Establish
Organizational Vision
P
PLANNING
Self-Diagnosis
Strategic Planning/ Develop 3-5
Year Breakthrough Objectives
Develop Annual Breakthrough
Objectives and Improvement
Priorities
Catchball
Deploy Improvement Priorities
D
IMPLEMENTATION
REVIEW
A
Root Cause
Countermeasures
Implement
Improvement Initiatives
Lean SS
CAP
Monthly Review
Critical Step
C
Annual Review
Annual
Review
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The Process of Critical Thinking (PCT)
Step 1 : WHAT
Breakthrough Thinking
Step 2 : HOW FAR
Annual Breakthroughs
Step 3 : HOW
Identify Key Driver Process
Step 4 : HOW MUCH/ WHEN
Determine Measures & Track
Step 5 : WHO
Identify Key Resources &
Deploy
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PCT Step 1 – WHAT?
World-Class
Breakthrough
Objective
Best-In-Class
Industry Standard
GAP
Current
Situation
Current Situation
Breakthrough Thinking Leads us to World Class
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PCT Step 2 - HOW FAR?
Breakthrough
Objective
Yr 3
Annual BT Objectives Yr 3
Annual BT Objectives Yr 2
Annual BT Objectives Yr 1
Yr 2
Yr 1
Current Situation
Identify First Year Breakthrough Objective
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PCT Step 3 - HOW?
Why?
Why?
Improvement
Priority
Annual Breakthrough
Objective
GAP
Why?
Why?
Why?
Current Situation
Identify Key Driver Processes
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PCT Step 4 - HOW MUCH/ WHEN?
100
0
Determine Measures & Track
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PCT Step 5 - WHO?
100%
100%
Resource A
3%
Current
Distribution
Of Resources
Resource C
Relative
Impact On
20% Improvement
Priorities
Resource D
40%
Team B
20%
Team E
0%
0%
Identify Key Resources & Deploy
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Daily Management and Hoshin Planning
Improvement
Once Breakthrough is achieved…
process is standardized to
Daily Management!
Hoshin
Planning
KAIZEN
Hoshin
Planning
KAIZEN
Hoshin
Planning
KAIZEN
Foundation
for
HP
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Strategic
Objective is
Achieved!
Daily
Mgmt
Daily
Mgmt
Year 0
Year 1
Daily
Mgmt
Year 2
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Daily
Mgmt
Year 3
Daily
Mgmt
Year 4
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PCT & the Top Level HP Matrix
HOW
Top Level
Improvement
Priorities
HOW
FAR
Annual Metrics
All items
are listed
in priority order
starting from
the center
Annual
Breakthrough
Objectives
Targets
to Improve
HOW
MUCH
WHO
3-5 Year
Breakthrough
Objectives
RESOURCES
WHAT
= Primary Responsibility
= Secondary Responsibility
OWNER
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Complete Top Level HP Matrix
3- HOW
Use dots to show
relationship of
Improvement Priorities to
Annual Objectives
Use dots to show
relationship of Targets
and Resources to the
Improvement Priority
Top Level
Improvement
Priorities
2- HOW
FAR
Annual
Breakthrough
Objectives
5- WHO
NOTE: Only Solid dots on
a resource deploy to the
next level
Targets
to Improve
3-5 Year
Breakthrough
Objectives
1- WHAT
4- HOW
MUCH
RESOURCES
= Primary Responsibility
= Secondary Responsibility
OWNER
The whole picture of your company on one sheet of paper!
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Linkage on the Matrix
Top Level
Improvement
Priorities
Dots show
linkage from
Target back to
Breakthrough
for that level
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Annual
Breakthrough
Objective
Targets
To
Improve
3-5 Year
Breakthroughs
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Points to Remember about the Matrix
• As soon as a solid dot is placed above a resource, that resource
will get a lower level matrix or an action plan.
• Clear circles indicate support resources. They do NOT get a
lower level matrix or action plan unless they get a solid dot on
another matrix.
TOP LEVEL - Company
• The dots are
to be used as
a sanity check
• The Improvement
Priority is deployed
SECOND LEVEL - Plant
to the lower level
matrix or an action
plan
Danaher Business System Office - Policy Deployment 1998
Top Level
Improvement
Priorities
Annual
Breakthrough
Objectives
Targets
to
Improve
3-4 year
Breakthrough
Objectives
Resources
l Primary Responsibility
m Secondary Responsibility
Second Level Policy Deployment
Second Level
Improvement
Priorities
Top Level
Improvement
Priorities
Targets to
Improve
Annual
Breakthrough
Objectives
RESOURCES
l Primary Responsibility
m Secondary Responsibility
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Transferring Improvement Priorities to the 2nd Level
TOP LEVEL
The 2nd level 12 o’clock and
3 o’clock positions have all
new text in them – nothing
is rotated into them from
level 1.
TOP LEVEL Policy Deployment 2004
Imp. Priorities
and Annual
Objectives are
copied directly
onto the 2nd
Level HP.
Matrices.
Top Level
Improvement
Priorities
Annual
Breakthrough
Objectives
Target to
Improve
3-5 Year
Breakthrough
Objectives
Resources
l
m
Primary Responsibility
Secondary Responsibility
SECOND LEVEL
Second Level Policy Deployment
Typically, a 2nd
Level Matrix is
created for a
primary resource
for each top-level
Improvement
Priority.
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Second Level
Improvement
Priorities
Top Level
Improvement
Priorities
Target to
Improve
Annual
Breakthrough
Objectives
RESOURCES
l
m
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Primary Responsibility
Secondary Responsibility
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Transferring Improvement Priorities To The 3rd Level
SECOND LEVEL
Not always suggesting
you need 3rd Level.
Based on size, complexity,
breadth, and maturity of
organization.
SECOND LEVEL Policy Deployment 2004
Top Level and
Second Level
Imp. Priorities
are copied
directly onto
the 3nd Level
HP Matrices.
Second Level
Improvement
Priorities
Top Level
Improvement
Priorities
Target to
Improve
Annual
Breakthrough
Objectives
Resources
l
m
Primary Responsibility
Secondary Responsibility
THIRD LEVEL
THIRD Level Policy Deployment
If necessary, a 3rd
Level Matrix is
created for a
primary resource
for each secondlevel Improvement
Priority.
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Third Level
Improvement
Priorities
Second Level
Improvement
Priorities
Target to
Improve
Top Level
Improvement
Priorities
RESOURCES
l
m
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Primary Responsibility
Secondary Responsibility
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Completing the Second Level PD Matrix
3- HOW
Use dots to show
relationships between
Improvement Priorities
and Annual Objectives
2- HOW
2nd Level
Improvement
Priorities
Top Level
Improvement
Priorities
Annual
Breakthrough
Objectives
Targets
to
Improve
Use dots to show
relationship of Targets and
Resources to the
Improvement Priorities
5- WHO
Use dots as a check to make sure
the Improvement Priorities & Targets
meet the goal and support the
Annual Breakthrough Objectives
RESOURCES
1- HOW FAR
4- HOW
MUCH/WHEN
= Primary Responsibility
= Secondary Responsibility
OWNER
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Cascading Priorities to ACTION
TOP LEVEL –
Company/Group
Danaher Business System Office - Policy Deployment 1998
Point of Impact - Action Plan
The level where root causes are
addressed! Action Plans can be
initiated out of any matrix level.
Top
Level
Improvement
Priorities
Annual
Breakthrough
Objectives
Target to
Improve
3-5 Year
Breakthrough
Objectives
Resources
l Primary Responsibility
m Secondary Responsibility
SECOND
LEVEL –
Plant/Business
Second Level Policy Deployment
Second
Level
Improvement
Priorities
Top
Level
Improvement
Priorities
Target to
Improve
Annual
Breakthrough
Objectives
RESOURCES
l Primary Responsibility
m Secondary Responsibility
Cascade as many times as
necessary to the
Root Cause Level
ROOT CAUSE
LEVELSub Plant/Dept
Second Level Policy Deployment
POINT OF IMPACT ACTION PLAN
Engineer/Supv
Policy Deployment Action Plan
Im provem ent Priority Title: *
Departm ent/Location: Managem ent Ow ner:
*
*
Date:
Review Team : *
*
Next Review : *
Environm ental Situation Sum m ary: *
Tim eline
Core Objective:
Third
Level
Improvement
Priorities
Second
Level
Improvement
Priorities
*
Action Step/ Kaizen Events
Target to
Improve
Top
Level
Improvement
Priorities
POINT
OF
IMPACT
= Original Plan
Ow ner (Lead is bold)
Milestone
Planned
Dates
x = Progress at Review
2003
Target Im provem ent
Status
Jan Feb M ar Apr M ay June July Aug Sept Oct Nov Dec ( P a st D u e i n R e d )
Im pact
RESOURCES
l Primary Responsibility
m Secondary Responsibility
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Creating Action Plans
Hoshin Planning Action Plan
Departm ent/Location: Managem ent Ow ner:
*
*
Im provem ent Priority Title: *
Date:
Review Team : *
*
Next Review : *
Environm ental Situation Sum m ary: *
Tim eline
Core Objective:
*
Action Step/ Kaizen Events
= Original Plan
Ow ner (Lead is bold)
Milestone
Planned
Dates
Target Im provem ent
x = Progress at Review
2004
Status
Jan Feb M ar Apr M ay June July Aug Sept Oct Nov Dec ( P a st D u e i n R e d )
Im pact
Create an Action Plan
For every Improvement
Priority at the Point of
Impact
Step 4: Identify the
impacts on the
improvement priority and
top level breakthrough
objective
Step 1:
Determine
actions & write
on worksheets
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Step 2: Record
ownership and
timing of the actions
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Step 3: What is the
current status of the
action. Color code
background as red to
show items past due.
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Action Steps Complete the Cause & Effect Chain
Breakthrough Objective:
Attain competitive advantage in Delivery Performance
Effect = Results!
Annual BT Objective #1:
Streamline Engineer-to-Order Processes
Effect = Cause
Top Level Improvement Priority:
Use HOS Tools to improve value stream of
Engineer-to-Order Process
Second Level Improvement Priority:
Implement Improved Order Entry Process
Action Step 1:
VSM Customer Service Process
Action Step 2:
SW Kaizen to improve productivity
by 35%
Action Step 3:
Effect = Cause
POINT
OF
IMPACT
POINT
OF
IMPACT
Actions = Cause
POINT
OF
IMPACT
VRK to reduce Quote processing time
by 50%
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Where VSM and Fits Into The Process
Breakthrough Objectives
Annual BT Objectives
Top Level Imp Priorities
2nd Level Imp Priorities
Value Stream Mapping
Action Plans
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Action Plans Drive The Rate Of Improvement
Hoshin Planning Action Plan
Im provem ent Priority Title: *
Departm ent/Location: Managem ent Ow ner:
*
*
Date:
Review Team : *
*
Next Review : *
Environm ental Situation Sum m ary: *
Tim eline
Core Objective:
*
Action Step/ Kaizen Events
= Original Plan
Ow ner (Lead is bold)
Milestone
Planned
Dates
x = Progress at Review
2004
Target Im provem ent
Status
Jan Feb M ar Apr M ay June July Aug Sept Oct Nov Dec ( P a st D u e i n R e d )
Im pact
DASHBOARD/SCORECARD
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Scorecards
Targets To
Improve
are entered in
priority order
JOP – Jumping Off Point from
which you started tracking the target
YTD ACT – Each month this field gets
updated (is YTD from the monthly
fields located to the right)
Planned targets are established for each month based
on the overall Target to Improve.
An actual that is a miss from the plan, is color coded red
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Each Target is Copied to the Top Level Scorecard
Human Resources Dept.
Finance Department
Sales Department
3-5 YEAR
BREAKTHROUGH
OBJECTIVE
Marketing Department
IMPROVE
Engineering Department
TARGET
TO
Materials Department
ANNUAL
BT
OBJECTIVES
Production Department
TOP LEVEL
IMPROVEMENT
PRIORITIES
Dev. Cycle to 120 Days by 12/95
Increase Market Share to 60%
Reduce New Prod. Dev. Cycle
RESOURCES
= Primary Responsibility
= Secondary Responsibility
TOP LEVEL MATRIX
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TOP LEVEL SCORECARD CHART
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Scorecards are Created for All HP Matrices
TOP LEVEL
SCORECARD
Danaher Business System Office - Policy Deployment 1998
Title
Top Level
Improvement
Priorities
Annual
Breakthrough
Objectives
Target s to
Improve
3-5 year
Breakthrough
Objective
Resources
l Primary Responsibility
m Secondary Responsibility
SECOND LEVEL
Second Level Policy Deployment
SCORECARD
2nd Level
Improvement
Priorities
Top Level
Improvement
Priorities
Targets to
Improve
Annual Breakthrough
Objectives
RESOURCES
l Primary Responsibility
m Secondary Responsibility
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The Review Process – Ensure Plan and Learn
Execute To
The Plan
P
A
Conduct Regular
Reviews
D
C
• Execute to the plan and perform daily, weekly and monthly reviews of
each action plan (Daily Mgt.)
• Reviews are designed to keep the Hoshin Plan on track
- Improvement Action owners don’t come to be evaluated
- The intent is to present the results of self assessment
• The review team provides focused assistance primarily around the
owner’s analytical process and preparation.
- What did you plan to do? (Plan)
- What did you actually achieve? (Do)
- How does actual vs. target compare (CHECK)
- Standardize what’s working, implement countermeasures and/or plan again as
required. (ACT)
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Manage Daily Management Through Leadership Standard Work
• Embed the Hoshin Plans into Leadership Standard
Work
• Make the Hoshin review process part of the daily,
weekly and monthly audit process
• The key is to constantly monitor progress and drive
accountability to the lowest level
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Third Level HP Countermeasure Sheet
Improvement Priority:
Targets to Improve:
$500
$450
$400
$350
$300
$250
$200
$150
$100
$50
$0
2003 Plan
2003 Actual
Process and organization to grow Printos sales in textiles and ceramics
Increase Printos valve/module sales in textiles & ceramics from $100k to $2,500k in 2003
Run Chart
2003 Plan
(the "Why"
Pareto (the
"Why"you
youmissed)
missed)
50%50%
2003
2003 Actual
Plan
2003 Actual
40%40%
30%30%
20%20%
10%10%
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
$0
$0
$20
$21
$3
$22
$65
$61
$65
$136
$123
$164
$345
$330
$397
$350
$286
$150
$333
$400
$453
0% 0%
Delayed
DelayedSales
Print
Delayed
Evaluation Insufficient
Kit
Insufficient
Evaluation
Kit
Sales
Engine
Development
Prospects
Development
Prospects
Delivery
45%
35%
%
45%
35%
20%
Percent
Delayed Print Engine
Delivery
20%
Problem Statement:
$136k monthly miss is due to Delayed Evaluation Kit Development, Insufficient Sales Prospects and Delayed Print Engine
Delivery.
Countermeasures
What
Who
When
How Much (Impact)
Short-Term: MJF
Long-Term: JBR
Short-Term:
10/28/03
Long-Term:
12/15/03
$61
DW/HW
10/15/03
$48
RZ/ MJF
10/22/03
$27
Addressed Root Cause: Delayed Evaluation Kit Development
Short-Term: Assign additional Engineer to complete evaluation
kit development (delayed one month) in time for ITMA show.
Long-Term: Update Tollgate process to include Engineering
development for necessary targeted-vertical launch kits.
Addressed Root Cause: Insufficient Sales Prospects
Execute Sales Funnel Targets for UK 'T' Shirt outlet…twice per
week follow-up on Sales Funnel Targets with Sales Engineer.
Addressed Root Cause: Delayed Print Engine Delivery
Execute kanban re-sizing process for Printos at once per quarter
frequency (currently twice-per-year…which is not frequent
enough for ramping production).
5 Why Analysis
• Systematic method to drive to the true root cause(s) of a
problem
• Simply ask “why” in a step ladder approach until fundamental
root cause is discovered. Root cause is not simply listing the
symptoms of a problem
• Normally, after up to 5 steps, the true root cause(s) will be
exposed
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Action Plans vs. Countermeasures?
Countermeasures are
reactive – they address how
to get back to plan when a
goal is missed for a period
60
50
Jump Off Point (JOP)
to stretch target
HP miss
40
30
Action Plans are proactive –
they address how to achieve
a particular goal from the
jump off point (JOP) to the
stretch target
20
Plan
10
Actual
0
J
F
M
A
M
J
J
A
S
O
N
D
Inventory Reduction Plan
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Monthly PD is typically an 8 hour meeting
Monthly HP/ISC Review Agenda Format
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• Establish the Growth Agenda for
Today’s HP Review
• Financial Review
5%
15%
60%
• Hoshin Planning
- Road Blocks to Growth, Major
Predetermined Topics
- Established HP Growth Initiatives
Follow a typical
MOR session
- New Product Development
- Remaining HP Elements (Q, D,C)
• KPI’s
• People/Org. Issues
20%
• Other Business
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Hoshin Planning Summary
• Aligns Strategy and Execution
• Systematically develops and links plans from
organizational vision to operational tactics
• Ensures deep and common understanding and
maximizes ownership and buy-in to plan
• Requires thoughtful, detailed planning for each and
every improvement action
• Consistently assesses actual performance vs. plan
and addresses issues and learns from the process
All Employees are Engaged in the Process
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Questions?