Why Hoshin Kanri?

By Ron Pereira Updated on January 14th, 2011

In this article we’ll continue our hoshin kanri series.

In part 1 of this series we learned what the words hoshin kanri mean… so be sure to check that out if you haven’t already.

Let’s Set Some Objectives!

As we start 2011 many companies will begin to focus on setting “objectives” for all employees.

Well, actually, what most companies seem to do is wait until around March to review 2010 objectives before finally setting vague and poorly aligned 2011 objectives by April or May.

The obvious flaw of this ever so broken performance management process is that employees know most managers are simply going through the motions because they have to.

Furthermore, by the time the employee gets their new “objectives” the year is usually 25% complete (sometimes more) and they realize they simply need to play the game without making waves and things will work out OK.

Why Hoshin Kanri is Better

The good news is there’s a better way.

Companies that use hoshin kanri are able to align objectives throughout all levels of the organization. As such, each and every associate knows that they are working on objectives that really matter.

Furthermore, companies that use hoshin kanri track performance of these key objectives each and every month meaning, in actuality, the end of year performance review can be used for other important topics such as career planning and development.

Long Term Vision

The reason many companies, especially publicly traded ones, are so obsessed with the inefficient management by objectives approach is that it plays nice with their short term “make the quarter” management style.

Conversely, the most powerful, and often hard to grasp aspect of hoshin kanri is how it enables companies to think long term as they identify where they want to be in 3 to 5 years.

From this long term vision the organization is able to work backwards as they set annual objectives that flow down into specific actions and projects that really make a difference.

And once associates realize the work they’re doing does in fact matter… they’ll engage like never before. Add in the fact they’ll be able to “keep score” of how they’re doing on a monthly basis and a recipe for amazing success is in place.

How are objective set at your company?

To wrap this article up, I’m curious to hear how your company sets and reviews annual objectives. 

When do you expect to learn how you did in 2010? Or do you already know? And when do you expect to learn what your 2011 objectives are?

In coming articles we’ll step you through the hoshin kanri process so please be sure to subscribe to our full feed RSS. You can also subscribe by email and have new articles sent directly to your inbox.

  1. Harry Almeida

    January 3, 2011 - 11:46 am

    I almost fell out of my chair laughing as we just got an email this morning saying we have to have our employee objectives for 2011 finalized by March 15! We do aim to review 2010 objective by end of February but you’re right that most see this as going through the motion.

  2. Linda Schmidt

    January 4, 2011 - 9:49 am

    We have used hoshin kanri, we call it policy deployment, for several years and can definitely say it has changed the way we manage our company. We struggled initially with too many breakthrough objectives but have now sorted this out.

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