High-performing organizations like Toyota have developed and evolved a very disciplined methodology that they call “Hoshin kanri.” It starts with high level or strategic imperatives and then cascades these through every part of the organization. Follow-through and follow-up is the key to moving this process from just another bolt-on planning program to a built-in management process. From my experience facilitating the senior management team through parts of this process in their Cambridge, Ontario plant, I know this is a core management process for Toyota. They aren’t just “doing their planning thing” and going through the motions.
The generic diagram below shows the flow of a process like this. It starts at the center with the management establishing, reaffirming, or revitalizing their Vision, Values, and Purpose (what I call Focus and Context).
1.Agree on three to five strategic (high leverage/impact) imperatives (do-or-die) for the planning cycle (usually annual). This generally involves using some form of Affinity Diagramming or clustering similar goals together to form a higher level strategic objective.
2.Establish management ownership/accountability (and steering/improvement teams) for each imperative.
3.Develop key measurements for each imperative.
4.Have every department/division at all levels develop their three to five imperatives and measures that flow directly from one or more of the strategic imperatives.
5.Set regular (e.g. weekly/monthly/quarterly) review and follow-up meetings at all levels, and communicate the results broadly (the more visible the better).
6.Start the next cycle by agreeing upon the three to five strategic imperatives for the next planning cycle.
Many organizations do steps #1 and #2 each year. With tools like the Balanced Scorecard, some organizations are trying to develop a balanced set of leading and lagging indicators. Few organizations get to step #4 with any vigor or consistency. And only a handful of the best-run organizations ever follow through on step #5 with any discipline.