Why this 50 year old Japanese tool could be the key to aligning your people, tools and processes

Tammy Martin

February 17, 2022

1960’s Japan marks a time in history where intense political struggles swept through the country. VUCA — volatile, uncertain, complex and ambiguous, a term used to describe that time is also being used a lot in the western world to describe the 2020’s.

Today businesses rely heavily on digital channels and platforms but live with uncertainty from the rapid changing behavior of their customers. Quite evidently social media and cancel culture has the power to wipe out a brand, business or public profile within minutes. Organisations and individuals are crying out for less VUCA and more capability to plan quickly, efficiently and remotely to achieve alignment and to create less ambiguity for themselves during these turbulent times.

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A bit of ambiguity is healthy for the creative mind and problem solving, operating with an infinite mindset and not a finite mindset is an advantage especially in leadership and management. But too much of the wrong kind of ambiguity in an organisation can be crippling for growth and development, flow and productivity, delivery of products and also mental health of the staff.

What is this tool?‍

Enter Hoshin Kanri, a 50 year old ‘strategy on a page’ tool from the Japanese world of lean management. Hoshin Kanri loosely translates to setting direction/compass needle and executing/management. It changes the role of executives from strategy setting to goal setting making it a more collaborative and purpose driven way of working.

Traditional Hoshin emphasises detailed work tracking, this adaptation is about harvesting the 1–20% improvement in productivity that comes from a whole organisation being on the same page. Deploying this approach has impacted employee engagement at the client’s by up to 20%.

How was the tool brought from 1960’s Japan to 2022 in the Western world?‍

In 1986 a Harvard Business Review article The New, New Product Development Game was released. Two Japanese professors revealed how lean was working to enable Japanese companies to innovate so rapidly through strict attention to processes, what we came to know as Lean, the home of some of the world’s most effective systems and tools to achieve productivity, speed, quality and performance. The article also describes a form of change called Kaikaku — radical change, the kind we have to be good at in 2022 digital businesses as a basic skill.

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In 1981 a product team from Japan traveled to London to observe what people were driving (Gemba). A lot of people were driving 1960s Minis so the team got to work in finding why they liked them. Finding that a lot of these people loved the mini but needed more head room the team then took those lessons back to Japan and in November 1981 created the Honda City ‘tallboy’.

What the tool actually looks like…

Why is this tool so good?

In my experience key challenges organisations are facing is not having enough capacity, lack of transparency of in-flight work, management who want to command and control, conflicting priorities and communication. No amount of money or consultants thrown at those things will be resolved if people are not on the same page and communicating regularly.

In my opinion the best way to achieve ultimate alignment in an organisation is to roll up your sleeves, get everyone involved from Executives to the front line staff and start filling out the hoshin to get everyone on the same page. I have worked in organisations where as little as 10% of the staff understand how their work fits into the bigger picture so it is up to the Executive team to write clear unambiguous goals that the rest of the organisation can then collaboratively create the strategies ‘how’ to achieve these goals and the work to be done.

It’s quite simple really.

• What are we doing? (Goals)
• How do we get there? (Strategy)
• What work do we need to implement to reach these goals? (Daily work management system)

I know you are thinking, well that’s easy enough to fill out but how do we track and operationalise it?

Obeya room or portfolio view kanban

‍​​An obeya room means ‘great room’ or ‘large room’ in Japanese and represents a place where leaders/managers and staff can view and track the priority of the work, see the backlog items, assess capacity of the teams to plan the backlog and visualise the flow of in-flight work.‍

Breakthroughs from using the Hoshin Kanri

• Survey results of an organisation I worked with showed that only 13% of their people understood how their work fitted into the bigger picture and company goals, once operationalising the hoshin this went up to 80%.
• The operationalisation of the Hoshin will surface what work is relevant vs not related to the company goals or strategies making it easier to highlight, discuss and kill the work that is not helping achieve those outcomes.
• Full alignment, transparency and regular discussions around the organisation’s goals and strategies right down to in inflight work show the organisation who is working on what. Breakthroughs, although painful, have shown me some organisations are planning 5–10 times beyond their actual capacity with full teams working on non relevant initiatives.

My next article is about connecting the strategy with the work, not just once a year but daily.

Stay Tuned.