Hoshin Planning, commonly referred to as “policy deployment”, is a method utilized to ensure that the strategic goals of a company are consistently driving development and action at every functional level of an organization. This type of methodology endeavors to remove all wastes resulting from discrepancies of direction and lack of communication in order to get every employee on the same page.
In order to ensure everyone within an organization is on the same page, a facility’s goals, management strategies and employee operational activities must all be synchronized in absolute alignment. The Hoshin Planning method is comprised of seven steps to achieve just that:
1. Establish Organizational Vision
- Evaluate existing vision and mission statement.
- Assess current policies, procedures, and management system.
- Analyze the present long-term goals of the organization.
2. Develop a 3-5 Year Strategic Plan
- Focus on five goals or less; a smaller number of goals makes it easier for companies to prioritize and generate objectives which are “real”, measurable and within reach.
- Goals and objectives should be primarily defined based on what will be the most effective, rather than the most efficient.
- Assess growth opportunities, continuously improve operations, and generate activities which will allow for revolutionary change within the organization.
3. Develop Annual Objectives
- Break down the overall goals of the 3-5-year plan into incremental objectives which will be achieved annually.
- Reaching the annual objectives confirms progression and will enable a company to reach their main goals in a measurable fashion.
- Provides the transitioning point from developing objectives to deploying objectives.
4. Deploy Annual Objectives
- Develop top-level improvement priorities; apply metrics to them.
- Develop second and third level targets which are business specific and are directly correlated to top-level priorities; apply metrics to them.
- Cascade strategic goals through all levels of the company.
5. Implement Annual Objectives
- Identify and solve problems.
- Implement changes.
- Execute improvements.
6. Monthly Review
- Formally and continuously track implemented activities.
- Evaluate progression in achieving annual improvement objectives.
7. Annual Review
- Assess if the year’s objectives are on track with the overall plan goals.
- Determine what changes need to be made in the following year’s cycle.
By utilizing the Hoshin Planning methodology, manufacturers are able to focus on best managing production and inventory to support customer delivery and supply chain operations in the most optimal way possible.
Benefits of Hoshin Planning include:
- Ensures the organization is consistently focused on specific strategic directions and goals
- Communicated objectives to the entire organization
- Creates a unified vision across all functional levels
- Errors are minimized and waste is eliminated
- All resources are used optimally and thus, money is saved
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