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).
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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.
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This is really interesting, Jim. What you’ve described here aligns almost perfectly with a systems approach developed by a mentor of mine, Michael Basch, author of Customer Culture, and the man who created all the systems that made FedEx legendary in its first couple of decades.
I’ve used Mike’s systems approach for 15 years now, and, like all of his tools, it’s incredibly simple/ easy to understand and yet incredibly powerful. It’s a great tool for diagnosing problems and for debugging a redesign after a significant change (if you want to see how well it correlates with your framework, I wrote an article about it here: http://www.co-creatingfutures.com/content.php?page_ID=374.
Glad you highlighted this here, Jim.
Thanks! Nice post.
I’ve known and really come to appreciate Ravi Tangri’s energy and thought leadership through our membership in the Canadian Association of Professional Speakers. You can read his blog at http://ravitangri.typepad.com/lead or visit his website at http://www.co-creatingfutures.com.
The entire June 2005 issue of The Leader Letter was built from, and around, this topic and the diagram in this blog posting. Sections include Common Causes of Priority Overload, Steps to a Goal Deployment System, Tips for Setting Team or Organizational Goals and Priorities, Leading by Example: Setting Personal Goals and Priorities, and Thoughts That Make You Go Hmmmm… on Goals and Priorities. Click here to read the June 2005 issue. http://jimclemmer.com/newsl/june2005.html
I first came across this cascading goal approach as “Hoshin Planning” in 1990 when we were developing our Service/Quality System at The Achieve Group (from which Firing on All Cylinders: The Service/Quality System for High-Powered Corporate Performance was written). Since then I have encountered numerous variations on the theme. Of course, Peter Drucker really started the whole concept with his Management by Objectives concepts back in the 1950s.
Hah am I honestly the first reply to this incredible read?
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strategic change management…
Great post. My approach to strategic change management says the quality of the first five percent determines what happens in the rest of the process. This same principle applies to many situations….