A webinar hosted by KaiNexus, presented by: Joanna Omi Consulting Director | Rona Consulting Group, the Lean practice of Moss Adams Craig Vercruysse Consulting Partner | Rona Consulting Group, the Lean practice of Moss Adams In this webinar you will learn: How the Hoshin practice evolves over time When to use an X-Matrix vs. an A3 The relationship between visual management and Hoshin Kanri The relationship between developing people and the must-do, can’t fail few Hoshins

1. Using Hoshin Kanri
to Align and Coordinate Your Lean Strategy
Mark Graban
Senior Advisor
KaiNexus
@MarkGraban
Joanna Omi
Consulting Director
Moss Adams
@JoannaOmi
Craig Vercruysse
Partner
Moss Adams
@CraigVercruysse

2. Webinar Logistics
•Presentation (45 minutes)
•Q&A (10 minutes)
•Use the GoToWebinar
Meeting Panel to
submit a question at
any time
•Recording link & slides will be sent via email
• Also – see the “Handouts” feature and Chat box

3. Using Hoshin Kanri
to Align and Coordinate Your Lean Strategy
Part 2: Going deeper into “scan” and “plan”
KaiNexus Webinar
May 31, 2018
Craig Vercruysse and Joanna Omi

4. Part 2 learning objectives
• How the hoshin practice evolves over time.
• When to use an X-matrix vs. an A3.
• The relationship between visual management and hoshin kanri.
• The relationship between developing people and the must-do, can’t fail
few hoshins.

5. Hoshin kanri – a brief refresher

6. hoshin + kanri
(direction) (management, control)

7. What is hoshin kanri?
• Also called strategy deployment, policy deployment.
• A means of connecting the macro with the micro. (John
Shook)
• A management process aligning—both vertically and
horizontally—an organization’s functions and activities with
its strategic objectives. A specific plan—typically annual—is
developed with precise goals, actions, timelines,
responsibilities, and measures. (Lean Lexicon, LEI)
• An organizational learning method and competitive
resource development system. (Hoshin kanri for the lean
enterprise, Tom Jackson)

8. Hoshin kanri
Just in time Jidoka
leveled production (heijunka)
cost reduction through the elimination of muda
people
materials
equipment
standard
work
standard
WIP
andon &
availability
takt time
production
flow production
system
pull system
production
5S
Hoshin is the roof of the Toyota management system

9. Hoshin as an (S)PDCA
Scan: Understand the environment.
Plan:
• Understand foundational mission, vision, and values.
• Identify “True North” dimensions and targets.
• Identify “breakthrough” strategic themes or goals.
• Identify one-year measures, responsible managers, and sub-teams.
• Create visual management.
• Play catchball to finalize plans.
Do: Implement the plan.
Check: Monthly management meetings to ensure success.
Act: Develop and implement countermeasures when fall-off occurs.
Plan
Do
Check
Act
Scan
(internal and
external)As we explained above, the hoshin team takes responsibility for the first three experi-
ments of the hoshin system. Once in the Plan stage, the hoshin team will help form and hand
off responsibility for the last four experiments to the other three types of teams that will have
their own set of duties within each Plan, Do, Check, Act cycle. There will be several tactical
teams—roughly one for every member on the hoshin team, even more operational teams, and
an even larger number of action teams. By the end of the Plan phase, you may engage every
manager in the hoshin process. Ultimately, in the Do phase of the hoshin process with its
action teams, you will engage the entire workforce at every level in the organization.
Workbook Tip: To assist the reader, beginning with Chapter 2, an icon representing
the experiment you are engaged in is at the beginning of each chapter—a total of
seven icons for seven experiments.
4 Teams
Hoshin Team
Tactical team
Operations team
plan
check
doact
plan
check
doact
plan
check
doact
plan
check
doact
plan
check
doact
plan
check
doact
plan
check
doact
7 Experiments
1. Long-term strategy
2. Midterm strategy
3. Annual hoshin
4. Tactics
5. Operations
6. Kaikaku
7. Kaizen
Action Team
Figure 1-1. The 4 Teams and the 7 Experiments

10. How hoshin evolves over time

11. Scan before plan
• Scan precedes plan-do-check-act.
• Sets context for hoshin.
• Provides the WHY for the PLAN.
• Is a communication vehicle.
• Created through catchball.
• Summarized in an A3i.
• Depth varies with need.

12. Early attempts
Hoshin not
cascaded
beyond
leadership,
testing tiered
measurement
and visibility
walls.
Confident
Hoshin cascaded
narrowly through
several tiers of
the organi-zation,
begins to be
reflected in daily
management.
The way
Hoshin “what”
cascaded from
top and rolls up
from gemba.“I
help put a man
on the moon.”
Exploration
Basic
understanding of
lean tools and
applications.
“Don’t know
what we don’t
know”
Are you ready for hoshin?

13. Hoshin kanri as continuous improvement
Current state dictates readiness – or the starting point – for hoshin
Strategicplan
Visual
management
Culture of
accountability
High-functioningleadershipteam
Time
Readiness
Monitoring
practice
Decision
making
Planning
AND
execution
muscles

14. Hoshin kanri as continuous improvement
The deeper the lean experience
the more facile and effective the hoshin process will be
Strategic
plan
Visual
managementCulture of
accountability
High-
functioning
leadership
team
Time
Readiness
Monitoring
practice
Decision
makingPlanning
AND
execution
muscles

15. The hoshin process is reflected in tiered visual
management
Tactical (Executive) –
provide a vision for the organization
Operational (Director) –
take the organization’s vision and apply it to
a particular department
Active (Manager) –
focus on a specific portion of
a department problem
PDCA (Staff) –
continuous testing of
different alternatives to
address a problem

16. Selecting the right tool and
making it visual

17. What’s missing?
• Mission – why do we exist?
• Vision – where we are headed?
• Values – how will we behave with each other?
• Environmental scan – what forces (supply or demand) impact
us in achieving our vision?
• True North – how do we describe and quantify our vision?

18. SCAN: tools and A3i
(3)
(1)
(5)
(4)
(2)
0
1
2
3
4
5
6
7
8
9
10
0 1 2 3 4 5 6 7 8 9 10
market focus:
global reach
market differentiation: healthcare specialization
Porter analysis of market for
lean healthcare transformation services
CD Form 2-2 Hoshin Kanri for the Lean Enterprise © 2006 Thomas L. Jackson Page 1
Product / Market Matrix
market
product
Porter analysis
Product/market matrix
Innovation matrix
SCAN Tools

19. Business Model Canvas: Strategyzer.com. Value Proposition Canvas:Strategyzer.com and Strategyzer AG.

20. Visualizing SCAN in KaiNexus?
Pick the appropriate scan tool
Provide data to substantiate
observations about the market and
internal capabilities. Speaking
through data and pictures!
Insert observations about the market
and internal capabilities

21. Value stream map
process
cycle
time
process
step
wait
time
process
lead
time
process
step
wait
time
process
cycle
time
CT = 47:36
LT = 117:15
Sequence of activities describing a process, including waits in between the process steps.

22. The basic contract in lean
A3-T
Proposed team charter Theme:
Date: Reporting Unit:
A3 document system © 2007 rona consulting group Page 1
PROBLEM STATEMENT
TARGET STATEMENT
ANALYSIS
PROPOSED ACTION
IMPLEMENTATION PLAN
Action Responsibility Date
CHECK AND ACT (verification and follow up)
PLAN
DO
CHECK / ACT
PLAN

23. A bundle of agreements
f c p g
year 1 year 2 year 3 year 4 year 5
 =
 =
 =
=
© 2008 rona consulting group
Legend
important correlation or core team member
correlation correlation / contribution
customer
weak correlation or rotating team member
weak correlation or rotating team member
strong correlation or team leader
proces growth team members
A3-X
correlation correlation / contribution accountability
tactics
financial results
strategicthemes
processimprovements

24. System-level deployment tree
Divisions (not all engaged in hoshin)
Division x-matrix/strategic plan
Division A3s
Hospital/subdivision x-matrices
Hospital/subdivision A3s
“Hoshin is just as much about structure as it is strategy.” ~Tom Jackson
(Strategy) deployment tree, obeya and visualization

25. (Strategy) deployment tree, obeya and visualization
A Short Demo of Strategy Deployment Software – KaiNexus Webinar, May 23rd
“Hoshin is just as much about structure as it is strategy.” ~Tom Jackson
The virtual obeya in KaiNexus

26. Considerations
• Level of detail required for strategy?
• Number of strategic goals?
• Will the strategic goal be cascaded?
• How deeply to deploy?
• How best to visualize?

27. Developing people through hoshin

28. Hoshin – an opportunity to develop people

29. Scan – engaging people
• Scan is a tool for communication.
• Tell the what.
• Explain the why.
• Obtain and incorporate feedback (catchball).
• Hoshin process begets the outcome.
• Scan provides the opportunity to fertilize the ground, to enable people to
provide constructive feedback through nemawashi.

30. Nemawashi—fertilize the ground
“The process of gaining acceptance and preapproval
for a proposal by evaluating first the idea and then the
plan with management and stakeholders to get input,
anticipate resistance, and align the proposed change
with other perspectives and priorities in the
organization. Formal approval comes in a meeting to
sign off on the final version of the proposal.” ~ (LEI,
Lean Lexicon)
In Japanese: preparing the roots (gardening)

31. Nemawashi in hoshin
• Achieve a common view of the world.
• Job of the leadership (hoshin team) is to fertilize the
ground.
• Deployment of scan (not volumes, but an abstract, in
the form of an A3i, redacted for confidential info).
• Included in the countermeasures section of an A3.
• Focuses on process, not outcomes.
• Encourages consensus.

32. Wrap-up

33. Wrap up
Things that help
• Use humble inquiry and catchball.
• Go slow to go fast.
• Ask intelligent questions.
• Be strategic in gathering feedback
and showing what you do with the
feedback.
• Establish a culture of trust in the
organization.
• Start with tools you can manage
with confidence.

34. Upcoming webinars in the series
• Part 3 (Fall 2018): going deeper into “do-check-act.”
• Part 4 (Spring 2019): tying the lean management system together—the gemba view.
Send us your feedback!
What would you like to hear about?
What are you working on?
What questions do you have?

35. We’ve joined the Health Care Consulting Practice at
Moss Adams effective September 1, 2017.
This combination is built on a shared culture
that cares about our people and our clients—
and helping them succeed.

36. Announcements and Q & A

37. Our Next Webinar
•Register at www.KaiNexus.com/webinars
•June 27 – Jamie Parker
•"How to Ease the Pain of Change"

38. Other Resources
www.KaiNexus.com/webinars Blog.KaiNexus.com

39. Q&A
• Web:
• www.kainexus.com
• blog.kainexus.com
• www.ronaconsulting.com
• Webinars on Demand:
• www.kainexus.com/webinars
• Social Media:
• www.twitter.com/kainexus
• www.linkedin.com/company/kainexus
• www.facebook.com/kainexus
Mark Graban
Senior Advisor
Mark@KaiNexus.com
@MarkGraban
Joanna Omi
Consulting Director
Moss Adams
@JoannaOmi
Jo.Omi@mossadams.com
Craig Vercruysse
Partner
Moss Adams
@CraigVercruysse
Craig.Vercruysse@mossadams.com