Hoshin Kanri:

Creating a Strategy Deployment Plan that Gets Results

Webinar
December 5, 2013
 Welcome!
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© 2013 The Karen Martin Group, Inc.
  Coach / Facilitator / Consultant / Trainer: 
Lead Lean transformations & develop people 
across all industries.
 Teacher: University of California, San Diego
 Author & Speaker:
Karen Martin, President
The Karen Martin Group, Inc.
www.ksmartin.com

2013 Shingo 
Prize winner!

© 2013 The Karen Martin Group, Inc. 3
 Upcoming Webinars

New dates added:  Feb 27, Mar 27, Apr 22, Mar 13

© 2013 The Karen Martin Group, Inc.
 Before the webinar…
• The materials are available on:
– www.ksmartin.com/files/webinarmaterials/MM‐
DD‐YYYY_slides.pdf (or _handout.pdf)

After the webinar…
• All recordings are available on:
– www.vimeo.com/karenmartingroup
– www.youtube.com/karenmartingroup
– www.slideshare.net/karenmartingroup
– www.ksmartin.com/webinars
• The materials are available on:
– www.slideshare.net/karenmartingroup
© 2013 The Karen Martin Group, Inc.
© 2013 The Karen Martin Group, Inc. 6
 Requirements for Excellence 
in ANY Endeavor

To purchase Shingo award‐winning The Outstanding Organization: 
www.amzn.to/VSMbk

© 2013 The Karen Martin Group, Inc. 7
© 2013 The Karen Martin Group, Inc.
 70%
Organization is attempting “more than” or 
“significantly more than” we can 
reasonably handle.*

* Poll of 700+ Subscribers

9
 Booz & Company Findings
90%
82%
80%
70%
64%
60%
49%
50%
40%
30%
20%
10%
0%
No written Conflicting Competing
priorities priorities demands
© 2013 The Karen Martin Group, Inc. 10
 Sporting Goods Manufacturer –
Product Launches Per Year
80
73
70
60 No additional 
resources; 
50 higher quality 
40 products 
launched
30
24
20
10
0
Pre‐Focus Post‐Focus
© 2013 The Karen Martin Group, Inc.
11
 Focus Law #1:
STOP DOING

Focus Law #2:
DO FEWER THINGS 
AT ONCE
© 2013 The Karen Martin Group, Inc.
© 2013 The Karen Martin Group, Inc.
 A Key to Apple’s Success?
“…saying no to 1,000 things 
to make sure we don’t get on the 
wrong track or try to do too 
much. We’re always thinking 
about new markets we could 
enter, but it’s only by saying no 
that you can concentrate on the 
things that are really important.”
— Steve Jobs

© 2012 Karen Martin & Associates, LLC 14
 What is Your Improvement Strategy?

© 2013 The Karen Martin Group, Inc. 15
 Annual Hoshin Planning 
(Strategy Deployment)

• Builds consensus around TRUE NORTH.
• Creates organizational focus on what matters most

© 2013 The Karen Martin Group, Inc.
For Further Study
 Building PDSA Capabilities
Strategy 
Deployment 
(Hoshin Kanri) 
or A3

Value 
Stream 
Mapping

Daily Improvement, Projects, 
& Rapid Improvement Events

© 2013 The Karen Martin Group, Inc.
 Develop
hypothesis

Refine
Conduct 
Standardize 
experiment
Stabilize

Measure 
results 19
© 2013 The Karen Martin Group, Inc.
 Strategy Deployment (Hoshin Kanri)
X‐Matrix

© 2013 The Karen Martin Group, Inc.
 Using A3 for Strategy Deployment: 
Undergoing “Mother” (macro) and “Baby” (micro) PDSA Cycles

• What’s the gap?
• What’s preventing us from meeting targets?
• Why?
• What actions do we need to take?

© 2013 The Karen Martin Group, Inc. 21
Last Revised: XX/XX/XX Strategy Deployment Plan ‐ Fiscal Year XX Quarterly Update:  Q1 20XX

Mission ‐ Type the mission that is trying to be achieved by the organization.

Performance, Gaps, and Targets This Year's Action Plan
Metric 20XX Actual 20XX Target 20XX Actual Goal Success Metric Owner Initiative / Priority / Project
1) A
B
C
D
E
F
2) A
B
C
D
Current Business Conditions E
Reflection of the current business conditions that could cause work needed to be done or work that needs to  F
stop.  What will be driving this years work? 3) A
B
C
D
E
F
4) A
B
C
Rationale for 20XX Plans D
Explain how the current business conditions will affect your plans for the coming year. E
F
5) A
B
C
D
E
F
6) A
B
Follow‐Up / Un‐resolved Issues C
Anything from the current that needs to be carried over to the next year.  Why? D
E
F
Template is provided courtesy of Matt Wrye  www.beyondlean.com  

Will be available for download by Thursday, December 12 – www.ksmartin.com/downloads
© 2013 The Karen Martin Group, Inc. 22
 “Hoshin‐Lite” Annual Work Plan
PRE ‐ Gain clarity around overarching business needs.

1. List everything you could do (and that you are doing).

2. Categorize into:
– Must‐do, can’t fail
– Maybe
– Eliminate
– Delay (next fiscal year)
3. Decide what you will do; gain consensus.
4. Prioritize and create plan.

POST ‐ Manage plan via weekly updates (may be able to reduce 
to monthly reviews – but be careful!).

© 2013 The Karen Martin Group, Inc. 23
 PLAN DEVELOPMENT PRE WORK

Gain clarity (and consensus) 
around business needs.

© 2013 The Karen Martin Group, Inc. 24
What matters?
To whom?
Why?

25
 PLAN DEVELOPMENT PRE WORK
Reflect on the organization’s current performance &                   
its position in the marketplace/community.

Where are                     
we having 
problems?

What 
opportunities     
can we leverage??

© 2013 The Karen Martin Group, Inc. 26
 PLAN DEVELOPMENT PRE WORK
Gather lists of:
• All active projects and initiatives
• All stalled projects and initiatives
• All planned projects and initiatives
• All desired projects and initiatives
• All “stealth/rogue” projects and initiatives

© 2013 The Karen Martin Group, Inc. 27
 Strategy Deployment:
The mechanics of a 2‐3 day              
planning session

© 2013 The Karen Martin Group, Inc.
 Label Four Flip Chart Pages & Hang on Wall
Must do Maybe
1. List what you could do on 
3x6” post‐its (active or 
planned initiatives, 
projects & improvement 
activities). Gain consensus.

2. Categorize them (place 
post‐it on appropriate 
page. Gain consensus.
Delay Eliminate
3. Decide what you will do. 
(Move “maybe’s” onto one 
of the other three pages.) 
Gain consensus.

© 2013 The Karen Martin Group, Inc.
29
 Must do Maybe

Step 4
Decide what 
you will do; 
Create Plan

Delay Eliminate

© 2013 The Karen Martin Group, Inc. 30
 Easy
Prioritization Grid
1

3
Ease of Implementation

10

11

12

13
Difficult

14

15
Low High
© 2013 The Karen Martin Group, Inc.
Anticipated Benefit
 PACE Improvement Prioritization Grid ‐ Example
9 22 17
23
8 3 21
Easy
10 4
13
5
15
Ease of Implementation

20 14
19 1
16

7 6

2 11 18

12
Difficult

Low High
© 2013 The Karen Martin Group, Inc. Anticipated Benefit
 Highest 
Prioritization Grid priority

0.7

0.6

0.5
Ease of Implementation

0.4

0.3

0.2

0.1

0
0 0.1 0.2 0.3 0.4 0.5 0.6

Potential Benefit

See The Outstanding Organization, p. 83 for an extensive list of prioritization considerations.

© 2013 The Karen Martin Group, Inc.
 Free Downloadable Excel Prioritization Chart 
The Outstanding Organization: Achieving Focus

Chart Title Prioritization Chart To use this Template:

1) Enter the title of the chart in Cell B2
Number of Items 5 2) Enter the number of items (e.g. projects, improvement activities, etc.) in cell B4
4 3) Enter the item name and ranking information into A8-D8 and so on.
Organizational Degree of
Item Name Benefit Execution Ease Urgency*
Item 1 9 1 1 Prioritization  Chart
Item 2 7 3 2
10
Item 3 5 5 3
Item 4 3 7 4 9
Item 5 1 9 5
8
7

Execution Ease
6
5
4
3
2
1
0
0 1 2 3 4 5 6 7 8 9 10
Organizational Benefit

* Degree of urgency is indicated by bubble size.

www.ksmartin.com/TOO
See The Outstanding Organization, p. 83 for a list of prioritization list considerations

© 2013 The Karen Martin Group, Inc.
 Modified Strategy Deployment Annual Plan
< Company Name >
2013 Priorities
1. Increase sales 5%. 2. Achieve 50% gross margin. Created: 01‐14‐13 Plan review dates:
2013 Goals & Objectives
3. Achieve 10% profit. 4. Improve morale (metric TBD). Revised: 
X = Planned ● =  Actual Level of Effort/Involvement Required
Tactical 
Priority Goal or Measurable Objective Exec Owner COM  CDs /  PD  PD 
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Owner IT Mktg Ops HR Bob Fin PE Pario BMD SWS
Direct  AMs Rec Mgmt
3,500 uni ts  s ol d by 12/31/2013 through a l l  cha nnel s  
2 X X X X X X X X X X X X Bob Da na 2 3 3 3 2 3 3 1 1 3 3 1 3
(a pprox. $700K)
Content removed for confidentiality 

11 Devel op & del iver tra i ni ng to top 50 Dea l ers X X X X X X Bob Rex/Tim  3 3 3

21 Revis ed cours e ma teri a l s  by 6/30/2013 X X X Bob Josh R? 2 3 3 2 2

Educa tion: 1 s chool  di s tri ct s pec'd/underperforming 
5 X X X X X X X X X X X X Howa rd Mi cha el   S 1 3 2 3 3
COM dis tri butor (25) by 12/31 va l ued a t mi n $35K ea ch
10 new dea lers on boa rd (net) ($500K per dea l er thi s  
8 X X X X X X X X X X X X Howa rd Mi ke B 2 3
yea r)
5 new di s tri butors  bri ngi ng $200K a nnua l  rev (& 5 
9 X X X X X X X X X X X X Howa rd Howa rd 1 1 1 2 3
termi na ted)
17 10 projects  s pec'd  by 12/31; $300K rev by 12/31 X X X X X X X X X X Howa rd Da na 1 3 3 3

29 20 by yea r‐end X X X X X X X X X X X X Howa rd Ma rk H 2 3 3 3

32 TBD X X X Howa rd Howa rd

33 TBD X X X X X X X X X Howa rd Howa rd

Useful  reporti ng a nd metri cs a re es ta bl i shed a nd i n 
10 X X Ji m Ra nda l l 3 1 1 1 1 1 1
pl a ce 
30 TBD X X X X X Ji m Jos h 3

31 TBD X X X X X X Ji m Jos h 1 1 1 3 1 1 1 1 1 1 1 1 1 1

25 TBD Ji m  Sha nnon  3 3 1 1 1 1 1

26 Sys tem 7.0's  i n pl a ce X X X Ji m  Ra nda l l 3 2 1 2 1

100% a ccura te pa yrol l ; 100% ma na gement s a ti sfa cti on 
15 X X X Jos h Phyl l is 1 3
a t Apri l mgmt. meeting
Internet ta s k l is t is  si mpl i fi ed a nd strea ml i ned for 
20 X X X X Mi cha el  M Mi cha el  M 2 3 2 3
PDs  then pl a n is  rol led out to PDs  
Des ign Ca l cul a tor i s  upda ted success ful l y a nd rol l ed 
22 X X X Nea l l Ma tt D 3 1 1 3 2 2 3
out
24 Competi tive Ana l ys i s  compl ete a nd di stri buted for us e X X X Nea l l Da na 2 3 3 3 3 3 3

1 Des ign cha nged to s ol ve dela m i ss ue  l ong‐term X X X X X Sus a n Da vi d R 3 2 3

30 pa rts  s ourced in U.S.; compl eted pl a n for ma na gi ng 

12 X X X X X X Susa n Sha nnon 3 3 2 2
Chi na ‐s ourced pa rts
Wa rehous e l a id out; ka nba n revi s ed; Sys pro 
13 X X X Susa n Sha nnon 3
i mplemented
14 La y out compl ete; equi pment i ns ta l led X X X Susa n Da vi d R 3 3

© 2013 The Karen Martin Group, Inc.
35
 POST: Plan Management

• Weekly status meetings to start, then 2x a month, 
then monthly (required attendance).
– Focus: how to turn yellow & red items into green.
– Expectation: Full team helps remove obstacles.
– Tone: supportive but tough.
• Visibility matters: post progress physically!
• Plan is adapted to changing conditions, but avoid 
Org‐ADD (organizational attention deficit disorder) 
and falling prey to unnecessary distractions.

© 2013 The Karen Martin Group, Inc. 36
 Strategy Deployment:
Necessary leadership behaviors           
and cultural shifts

© 2013 The Karen Martin Group, Inc.
 Necessary leadership mindset & 
behavioral shift:

FROM: “We have all the answers.”
TO: “What do you think?”

© 2013 The Karen Martin Group, Inc.
 Strategy Deployment Key Feature: Catchball
What?
How? Executive 
Who? Team
When?

What?
Year 1 How? Senior 
Who? Mgmt
When?
Year 2
What?
How? Middle 
Year 3 Mgmt
Who?
When?

What?
How? Frontlines
Who?
When?
© 2013 The Karen Martin Group, Inc.
39
 “Going to the gemba 
has been life changing 
for me as a leader.”
‐ Ginny Cattaneo, Sr. VP, Franklin
Templeton Investor Services 

© 2013 The Karen Martin Group, Inc. 40
 Cascading Goals is the Means to 
Organizational Alignment

Organization

Division/Business  Division/Business  Division/Business 

Unit Unit Unit

Department Department Department Department Department Department

Individual Individual Individual Individual Individual Individual

Individual Individual Individual Individual Individual Individual

© 2013 The Karen Martin Group, Inc.
 Productivity (Pounds Produced / Hr Worked)
115.0

Pactiv
108.0
Implements
Strategy 105.9
Deployment

101.0

95.2
94.0 93.0
90.6

87.0 86.3
84.8

80.0
FY '06 FY '07 FY '08 FY '09 FY '10 YTD '11
42
 Rockwell Automation
25
20
20 Projects
Started
15
12 12 Projects
Completed
10

5 3

0
Pre‐Focus Post‐Focus
© 2013 The Karen Martin Group, Inc.
43
 Clarity
Consensus
Courage
Commitment

© 2013 The Karen Martin Group, Inc. 44
 Avoiding the Shiny Ball Syndrome 
(Organizational ADD) Requires…
• Clarity – about what really 
matters & organizational 
direction.
• Consensus – about how best 
to get there.
• Courage – to actively choose 
to “not do” or “not do now.”
• Commitment – to stick with 
the plan.
From the Focus chapter:
© 2013 The Karen Martin Group, Inc.
The Outstanding Organization, Karen Martin
 For Further Questions

Karen Martin, President
7770 Regents Road #635
San Diego, CA 92122
858.677.6799

ksm@ksmartin.com

Blog & newsletter:  www.ksmartin.com/subscribe

© 2013 The Karen Martin Group, Inc. 46
 Your Questions
• How can we relate Hoshin Kanri to the 
Balanced Scorecard Method for strategic 
management/measurement? (Ahmad)
• How does this work in a highly siloed 
organization? (Anne)

© 2013 The Karen Martin Group, Inc. 47