Hoshin Kanri - Quality Management

Introduction

The Japanese translation of Hoshin Kanri is as follows:-

“ho” – method “shin”

- shiny metalshowing direction “kanri”-planning

A useful interpretation of the literal translationis that Hoshin Kanri is a “methodology for setting strategic direction”, which is also known as Hoshin planning, policy management and policy deployment.

Hoshin Kanri is a planning system developed in Japan in the 1960’s as a derivative of Management by Objectives (MbO), and is believed to be dramatically superior to other forms of planning, particularly for integrating Total Quality Management (TQM) with the business plan of an organization.

Hoshin Kanri Planning Principles

Hoshin planning is not a strategic planning tool in itself, but can be thought of as an execution tool for deploying an existing strategic plan throughout the organization, although it can facilitate the strategic planning process. It does depend on having a clear set of objectives articulated by the Chief Executive/Company President. Application of Hoshin Kanri will then translate the strategic intent into required day-to-day actions and behaviors.

Hoshin planning principles are formulated around companies knowing what their customers will want in five to ten years, and understanding what needs to be done to meet and exceed all expectations. This requires a planning system that has integrated Deming’s “Plan-Do-Study-Act” language,and activity based on clear long-term thinking. The measurement system needs to be realistic, with a focus on process and results and identification of what’s important.Groups should be aligned with decisions taken by people who have the necessary information. Planning should be integrated with daily activity underpinned by good vertical and cross-functional communication.Finally, everyone in the organization should be involved with planning at local levels, to ensure a significant buy-into the overall process. Figure shows a model of the Hoshin planning system.

The Hoshin planning system

The Hoshin planning system

The major elements ofthe model can be summarised as:

  • Five-year vision: This should include a drat plan by the president and executive group. This is normally an improvement plan based on internal and external obstacles, and revision based on input from all managers on the drat plan. This enables top management to develop a revised vision that they know will produce the desired action.

  • The one-year plan:This involves the selection of activities based on feasibility and likelihood of achieving desired results.Ideas are generated from the five-year vision, the environment and ideas based on last year’s performance. The tentative plans are rated against a selection of criteria and a decision made on the best action plans.

  • Deployment to departments:This includes the selection of optimum targets and means. It focuses on the identification of key implementation items and a consideration of how they can systematically accomplish the plan.The individual plans developed are evaluated using the criteria that were used for the one-year plans.

  • Detailed implementation:This is the implementation of the deployment plans.The major focus is on contingency planning.The steps to accomplish the tasks are identified and arranged in order. Things that could go wrong at each stage are listed and appropriate counter measures selected.The aim here is to achieve a level of self-diagnosis, self-correction and visual presentation of action.

  • Monthlydiagnosis:this is the analysis of things that helped or hindered progress and the activities to benefit from this learning.It focuses attention on the process rather than the target and the root cause rather than the symptoms. Management problems are identified and corrective actions are systematically developed and implemented.

  • President’s annual diagnosis:this is there view of progress to develop activities which will continue to help each manager function at their full potential.The president’s audit focuses on numerical targets, but the major focus is on the process that underlies the results.The job of the president is to make sure that management in each sector of the organization is capable.the annual audit provides that information in summary and in detail.

Phases of Hoshin Planning

In order to apply the principles of Hoshin planning effectively, there are a number of prerequisites that an organization have in place. It is not sufficient to attempt to translate to an environment of Hoshin planning as a short term solution.

Instead the organization must develop a strategy based on the five phases as suggested in Figure.

Phases of hoshin planning

Phases of hoshin planning

Cross Functional Management

Cross-functional management (CFM) is necessary for successful implementation of Hoshin Kanri along with a concept known as “catchball”. CFM requires a significant change in the structure of management relationships,inorder to allow continual checking of goals and means throughout the implementation cycle to steer the organization to its new direction.Catchball is a term derived from the children’s ball game, where instead of a ball, an idea or goal is tossed around from person to person.It is a vital element which requires constant communication, to ensure the development of appropriate targets and means, and to their deployment at all levels in the organization. Systems must be implemented to ensure feedback in bottom-up, top-down, horizontal and multi-directional horizons.

To realise such a communication network, there must be a company commitment to employee involvement and continuous improvement. This approach builds buy-in through participation in the goal-setting process, and consensus with the team to ensure appropriate levels for goals and targets.

The positive aspects of Hoshin planning rather than management by objectives are the specific focus on measuring results through process rather than targets. In management by objectives the objectives of the target setting and measurement tends to be on business tangibles such as profits and cost. The organization tends to engender a culture of individual orientated management control and trouble shooting, rather than team work and continuous improvement. Hoshin planning tends to focus on self-assessment with individual participation and flexibility. Inorder to apply the principles of Hoshin planning effectively, there are a number of prerequisites that an organization have in place. It is not sufficient to attempt to translate to an environment of Hoshin planning as a short-term solution. therefore the focus is on individuals making plans that are tied into a company vision, diagnosis of company processes and comparing actual results against the original targets.

The Benefitsof Hoshin Kanri

The benefits of Hoshin Kanri as a tool for Strategic Quality Management(SQM) compared with conventional planning systems include; integration of strategic objectives with tactical daily management,the application of the plan-do-check-act circle to business process management, parallel planning and execution methodology, companywide approach, improvements in communication, increased consensus and buy-in to goal setting andcross-functional-management integration.


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