LEAN can’t be supported if one only goes the events-only route. Kaizen and Kaikaku are powerful tools, but their results can’t be sustained without a new form of leadership. Central to that new leadership style is developing and living a strategic plan.  Hoshin Kanri (Hoshin, for short) is the tool LEAN uses to develop that strategic plan.

There are two key avenues that Hoshin Kanri will take.

• The first will be the development of top-down metrics. 
• The second is a tool called an X-Matrix.

Top-Down Metrics

Your leadership team will track performance against the metrics using charts kept by each level of management and posted on something called a Key Performance Indicator (KPI) board. Frequent monitoring of these boards by the next higher manager ensures three things.

1. First, your managers will be going to where work is done and not running their organizations from their offices. They’ll be seeing things first hand.
2. Second, it will cause managers to keep regular track of key metrics. No longer waiting until week-end or month-end reports to find out how they did.
3. Employees will be able to see how they’re doing as a small team, and how you’re all doing as the big team.
4. The Hoshin Kanri metrics and your new attention to KPI boards will lock your entire organization in the pursuit of the same thing: Mission Success. Everyone in the whole organization will be able to see how what they do fits in the greater success of the business. They’ll also grow accustomed to working in unity, rather than in competition, with each other.

X-Matrix

Coupled with top-down metrics, your X-Matrix will allow you to not only control the thrust of your organization’s progress, but its trajectory. Without getting into too much detail, you’ll use your Hoshin Kanri to create your 3-5 year strategy. You’ll use the X-Matrix as the place where you’ll record the details of the strategy.

One of the functions of the X-Matrix will be to break your strategic plan into tactical initiatives. It also documents what changes you’ll need to make, which resources you have dedicated to each initiative and what outcomes you expect from them. In short, your X-Matrix becomes the True North of your organization.

Monitoring progress against your X-Matrix tactics is performed using another tool called the A3. Named for the size of paper it’s on (11” x 17”), the A3 will be the way that your project managers will communicate to your executive team.

Does Hoshin Kanri sound too complex? Too much? G2L will take you step-by-step through the process and guide you as you use each of the tools.