Hoshin Kanri: Creating a Strategy Deployment Plan That Gets Results

good morning everyone and welcome to the second webinar this week this one featuring hoshin kanri also known as strategy deployment or policy deployment and I don't know whether you saw my web post or answer my blog post earlier this week about my favorite time of year I'll talk a little more about that and why this is my favorite time of the year and it very much relates to hoshin kanri so let's go ahead and get started and welcome everyone from across the globe especially those of you that are up late and up very early and I want to give a special thanks to Israel and Morocco I think it's the first time we've had anyone on the line on the webinar from Israel and Morocco so welcome to you and to everyone else as well for those of you who may not know me I'm Karen Martin and I'm the president of the Karen Martin group we are a consulting coaching facilitation and training group for all things lean as well as just general business performance improvement I also teach at the University of California San Diego in the Lean Enterprise Extension Program and author and speaker of now four books actually five if you count metrics based process mapping twice because it's been released twice and the most recent one just came out this week value stream mapping it's starting to ship I actually always order one myself and I just got the notice today that's on its way to me I have just received mine directly from the publisher and it were really quite pleased with how it turned out my cost rolling I my co-author so I feel free to pick up any of those that would be helpful to you on your improvement journey as far as upcoming webinars just a quick note that I have a webinar page that many of you are very familiar with you can access that for up-to-date information or register for the newsletter which is all a great way to find out what's being scheduled and when and I want to let you know that I did just add four new dates on to my calendar but they're not in in registration mode yet but just in case any of you like to plan for in advance those are the dates that are that I have on my calendar for some upcoming oops I'm sorry this March 13th is May 13th I just noticed that typo so February 27th March 27 April 22nd and May 13th are the next four beyond those that are already listed on the website I'll get them done Oh probably about this time next week all the registrations will be available I still have to write up the promo copy and then also just a couple questions after the last webinar urged me to remind y'all that the materials are available an hour before each webinar and they always file this standard convention as far as the URL format so the beginning part is always the same and then the date is the month the date and the year so we use a zero if it's a single digit for date and a year and an underscore slides if you want the full slides and underscore handout if you would like two slides per page to conserve paper and dot PDF is the at the end of it so that's the convention an hour before the webinar for all materials after the webinar the recording itself is available for different locations which you can see here and the materials are on SlideShare and they're removed from this website location so that you can get them on SlideShare after the webinar feel free to pass that word on to people who might be interested in hearing what the content was if you enjoyed it and thought it was helpful so back to the blog so this time of year is my favorite time of the year in terms of business planning and I've long done this personally and now of course well I've had my business for 20 years so it's been an increasingly large part of how I spend the last couple of months of the year in reflection back on the previous year or what worked and what didn't work what I want to do more of what I want to do less of and in looking forward and making a very very detailed plan for the following year so one of the things that is happening out there in the larger world is that a lot of folks are saying planning is kind of ridiculous because there's no certainty in the world and you can't predict what's going to happen so why plan well I say poppycock to that you know I can't even imagine operating without a plan and I think what's happened is that those people that are come anti plan have seen organizations and individuals create a plan and then stick to it no matter even if there's evidence facing them that something some condition has changed that makes it so you should change your plan so you know planning is never meant to be set absolutely in concrete you are absolutely supposed to continue with the PDSA cycle plan do study adjust plan do study adjust and keep you know keep on flexing the plan as new conditions arise and as you have new learning but you know if you don't have a plan then you're very likely going to be you know kind of suffering from organizational and personal ad D attention deficit disorder and moving around from one priority to the next and not really accomplishing much of anything because there's not really a solid focus on what matters and what you how you should be spending your time so take a look at this blog post if you want to hear a little more about my view of what what really is required behind the plan is a fair amount of listening very deep listening and humility you can take a look at that and if you don't get the blog feel free to sign up for that as well so love this time of year so I'm happy to be doing giving this workshop or this webinar today and this workshop or once our webinar really came from my intense study of strategy deployment which is the term I'll use when I was writing my last book the outstanding organization and looking at these four behaviors that I found are common in all outstanding organizations and performers of any sort whether they be sports arts yeah music drama the whole you know any kind of outstanding performance at all there's a common there are four common behaviors that all top performers have including organizations and there are very high levels of clarity focus discipline and engagement and what I found over the past 20 years in working with lots and lots of organizations in pretty much every industry all different sizes all different levels of maturity in terms of how young or old they are they all seem to suffer from a tremendous amount of wasted effort and non-productive time and general chaos which is the foundation of my book because of this lack of focus and lack of understanding what really matters and what TrueNorth really is and this is true personally as well so you know as I have learned more and more and more about lean over the last 13 years I get more and more convinced that it's you know very much a personal management methodology and as effective in that regard as it is for organizations but let's talk about focus and what really happens with focus or the lack thereof so what I see are especially if you're a full-time improvement professional what I see are a lot of full-time improvement professionals having a fairly high degree of frustration because they start down one path and then some leader changes a priority and then they drop that go to another place and I was just with a client yesterday in the Los Angeles area that reported for projects that they had started on last year and they never completed because some other priority came along and bumped those projects out and in one case they were this this group of middle managers to director level you could see the pain actually when they were talking about how close they got to completing one of them and they just simply weren't allowed to continue and that's just that just you know tears me apart when I hear that kind of thing because they all that effort that goes into something and then to not be able to leverage it through seeing the improvement just seems like such a waste of time and in a silly mistake for an organization to make so when I was writing the outstanding organization I did a survey of all my newsletter subscribers and I got 700 responses back saying that 70 percent of those responses said that their organization was attempting more than or significantly more than the organization could reasonably handle which didn't surprise me that actually was kind of spot-on on what I was thinking I would hear based on what my I've observed it with my own clients what was interesting is I also came upon this it's a real-time Booz Allen study that's being done it's still being done where they're doing ongoing surveys and adding to their data mine every you know remember us a few months or so the results that they're getting and what I found shocking about this is that you know almost 50 percent of CEOs or that were interviewed said that they have no written priorities so they may have a priority in their head but they don't have priorities that are written down anywhere that to me that was a shocking number that fifty percent on these very large companies that were being interviewed fifty percent of them didn't have a methodology a disciplined approach toward clarifying and communicating the priorities so it's no wonder that you've got people competing for resources and IT feel like it's being put upon and in leaders disagreeing with each other sometimes at the very highest levels about where the company should be focusing its attention it's it's a very serious problem and it's actually fairly easy to resolve with a fair amount of discipline and desire to solve it so here's an example of what you can do by putting far greater focus into your organization which is what hoshin kanri is all about this was a sporting good manufacturer that before they did any sort of focus work which hoshin kanri is they were producing about twenty four product launches a year after they put some discipline into their approach they were producing 73 product launches a year with not one additional resource and they were reporting anecdotally much higher quality products coming out as a result so you may say well how did they do that surely that's not just from focusing yes actually it was and the reason why is that there are two very important laws to be effective with focus one is you've got to stop doing some stuff stop doing as as is absolutely as important to be considering as what you are going to do the second one is do fewer things at once and this is the one that allow should go from going back here from 24 to 73 per year what allows you to do that is by focusing on number law law number to do fewer things at once now this may sound kind of crazy how could we possibly accomplish this just because we're doing fewer things at once well there's no such thing as multitasking cognitive to cognitive tests you can multitask one that's not cognitive with one that is like for example you can eat and read at the same time but you can't read and listen to someone talking and comprehend both at the same time so what you're actually doing is switched tasking and going back and forth between two cognitive tasks and every time you switch tasks you are - it takes additional time to wrap your mind back around the task that you were doing that you left to switch and then and that added time there is lost productivity so David Mayer at the University of Michigan did some of the most early work in studying engineers and how often engineers were switching back and forth between projects and he found that the average engineer switched 6 to 8 times per day and every time they switch they lost 20 minutes of time when you add that up over the course of a year in 1/5 even if you only had 15 engineers on on your payroll that would mean as those that's like 3 of them doing nothing but thinking about what they might want to do that that's that's what that 20 minutes six to eight times a day calculates into so it's a significant productivity loss to do that and when you think about that's an individual when you think about an entire organization and when you think about an organization switching projects that have project teams and the complexity of all that because the more complex the project or the prod the task the longer the wrapping your mind wrapp back around at time is it is significant significant productivity loss not to mention frustrating annoying disengaging irritating all of those other things that it so what we have to do is start considering that in business we are subject to habitually going toward distractions we have habits very bad habits that make us not able to focus and it's in large part because we try to do too many things at once where you have this huge risk so you know texting while you're driving absolutely can kill people and doing two things at once in an organization can kill productivity and hurt performance just as as easily as you know texting and driving at the same time can result in death it's it's really quite a big problem in most organizations and just talking to your leadership teams and talking to peers about this is one of the first steps you can take it's a very practical step it's a non-threatening step to just start talking about this and yet heighten the awareness internally about how bad this problem actually is in your organization the other thing to think about when you're out there talking about this is that some of the most successful companies have had CEOs that were masterful at saying no and you know Steve Jobs had all kinds of other leadership weaknesses that we could talk about but we're not going to one of his strengths was saying no the ability to focus like laser focus on what really matters and that's how they were able to accomplish really great things and very innovative products and high-quality products and not make people crazy in the process so and I mean crazy from you know stress of shifting with switch tasking back and forth and all that so you know he just take a look at some of the strengths that Steve Jobs had and one of those characteristics of focus was just something that you know we need to bottle and inject into every executive in every organization so the question is when you have limited resources and limited time which we all do what are you going to work on what really matters this is where hoshin planning shines strategy deployment or policy deployment being the other names for it what I hope planning allows you to do hoshin kanri is to get consensus organization wide consensus around what your TrueNorth is so you get rid of the very common problem of sales feeling like the organization should go in this direction and operations say uh-uh I want to go in this direction or you've got in the healthcare environment you've got finance people saying you know we need to develop this service and you've got the clinical sites saying no no no EADS developed this service so this allows an organization to have the frank discussions and and it forces them to deep to to explore deeply what the true needs really are what the opportunities are what their problems really are and it requires a fair amount a fair amount of truth seeking and truth-telling in order to do this effectively and then it creates that organizational focus so where did hoshin kanri come from well it actually started back in the 50s during the total quality management era with a cows book hoshin kanri and then over the years when people were starting to study Toyota and seeing what Toyota was doing so masterfully we saw that they were doing a fair amount of hoshin kanri internally there and then there were two books that were produced more recently hoshin kanri which is a typical business nonfiction type of book as far as the format goes whereas getting the right things done by pascal dennis is a novel a business novel type format and they're both really good but I have to say I just picked up getting the right things done for about the fourth time since I bought it many years ago and read some big chunks of it again and I love how you know as we learn going back to some really good books is so helpful because you see things through a different lens once your knowledge gets you know more you get a little more proficiency in what you're doing and you're working toward that mastery level the higher you go the more things that you can still learn by going back to the same books and so I was looking at Pascal's book again and you know it really it really is a book that you all need to read and tell everyone in your organization to read it because he really nails what an organization should be doing in order to get great focus get a lot of clarity get consensus across the leadership team fully engage everyone in these decisions it's just really a wonderful books I can't I can't say anything enough about it if you go on my website under learn there's a reading list and you can just click right from there to get to the Amazon page so I'm eka mend it alright so hoshin kanri is what I consider the mother of PDEs a plan to study adjust I won't go into the details for those of you who are new on why I say plan do study adjust versus plan-do-check-act but trust me I've got good reasons and you can read that the outstanding organization for lots of detail on that but plan do study adjust is you know a methodical way of thinking through and executing on priorities and problems and new projects so if you think about PDSA in terms of nested cycles or fractals of each other the largest cycle would be an organization setting their annual plan for how they're going to execute on their business strategy so hoshin kanri would be that macro macro level and then in the might of the micro or the mid-level you could have for example value stream mapping that you're doing a full transformation of an entire value stream and that would be an example of doing something kind of using PDSA to execute on a mid cycle and then you could also turn to a very small micro PDSA to do daily improvement or kata if you are using that term projects rapid improvement events Kaizen events etc and there's even another one inside that small one that is within a project or within a Kaizen event or within the kata process that you're doing a PDSA cycle as well so you know leaders often don't start with PDS a it often starts mid-level in an organization or even closer to the frontlines but this is a great way to teach your leadership team also the benefits of operating using a plan study adjust cycle so when you think about what PDSA is it's really about developing a hypothesis and then conducting an experiment and then measuring the results of that experiment and then adjusting based on those results so when you think about a big annual plan for what a company is going to do what they're gonna focus on they have a hypothesis at that point that the things that they're on that are on that list are going to get them to the next point so obviously there's a lot of clarification that you have to do upfront to determine where you're at and where you want to be and why the gap and what's the root cause for the gap there's a lot and I'll talk more about that as the webinar goes on but it does represent the annual plan does represent a series of hypotheses that are going to be proven or disproven as the organization goes forward and does work so when you think about lean leadership and transforming the leadership mindsets and behaviors this hoshin kanri or strategy deployment methodology is a brilliant way to get leaders engaged with the scientific methodology upfront because it's at their level they don't have to go to the frontlines and get on a Kaizen event team for example in order to experience PDSA so what what a cow came up with and what has been kind of perpetuated forward throughout the decades since since hoshin kanri was being used was this report that is that known as an x matrix it's on a single sheet of paper often eight-and-a-half by eleven sometimes a little bit larger and it includes everything in a glance that the organization's going to work on at least the mother x matrix does it shows what are the measurable targets that are being that you're you know are providing the TrueNorth for individual priorities you know why are you doing those priorities what are they going to achieve how are they going to manifest in terms of the financial benefits and things like that so it is you know something that you see out there a fair amount I don't use the X matrix anymore I tried with so many clients early on and I found that it just added a level of complexity and added confusion to a process that was already taking a fair amount of bandwidth for an organization to get used to it I just am NOT a fan of using any kind of a tool that's not really easy and I didn't find this for my clients very easy to comprehend so the other thing you could use I'm giving you some options here is it's very appropriate to use a typical a3 format to create an annual strategy and in this case you would have a mother or a three which is for the whole organization and some of the high-level priorities and goals and then you know going through how those are going to be executed well and then you can have a series of baby a threes so that they would each support one of the larger goals so you can have me a macro to micro in terms of multiple a threes at different levels so basically the a3 report would be reflecting the process of going through PDSA and determining you know what's the target what's the gap what's preventing us from meeting our targets why is that happening what actions do we need to take and so forth and you could reflect it in terms of an a3 report that drives you know consensus building and conversation and learning and all of that now today or actually yesterday when I was trying to get ready for the webinar I was doing a little bit of searching because I'm not a huge fan of giving templates most of you know that a lot of you have asked about templates and I say no no you know you it's a template shouldn't fix your thinking the templates should reflect your thinking and so I did happen to stumble upon what I consider to be a pretty interesting substitution for the X matrix that Matt Rui WR ye straight down here created and his site is beyond lean comm he's got a nice blog he has some really good resources there and I asked him permission to share this with you and he said not only did he say yes to that but he also is allowing me to put it into a download page that we're building right now on my website and it'll have all the downloads that you can having ones in one place because right now they're kind of spread across different book pages and all that excuse me so we're gonna put it on one page it'll be done next Thursday so you can go ahead and download this if you'd like to next Thursday but basically if you take a look at it what he has is an ability to show your revision date you know when you are taking a look at the plan what the mission is or missions if you have a couple different missions for the organization what they are there what are the kinds of metrics that you want to be targeting what the current conditions are what the rationale is for the plan and then a little section here for any unresolved issues and follow-up that needs to be done so it's got some of the elements of a classic a3 report but not all of them and then over here is where you've got a full list of up to six different goals and what the metrics are going to look like to show that you've been successful in implementing those goals so there's you know it's an interesting format I think it's very clean and it might be something you'd be interested in now what I use is a different actually I didn't I changed the order here I'm going to show you mine after I go through the process I use so that it makes sense on why my format is like it is one of the things I think you missed in both my format which you'll see in a minute and this format is it's not quite as visual as an a3 is and it's not quite as obvious how everything ties together as perhaps an X matrix allows but I I'm just speaking from experience my clients are responding much more to this kind of a format than they are the X matrix or an a3 it's just hard to fit everything on an a3 that you need to fit so here's what I do and this is I call it hoshin light because it's not classic in the full sense but it's darn close on there is this is just the summary slide of what I do and I'm gonna go into each one of these so there's some pre work that has to be done before I work with the client and I'm facilitating them through this process so it's mainly around getting clarity around what their business needs really are which sometimes is monumental for an organization to get clarity across the full leadership team about what their needs really and then for the event itself I break it into the four steps it's usually two to three days that I'm working with a team not always consecutive but I prefer at least two of the days to be consecutive and we're basically spending the first part of the time together listing everything that they could do and then that list is categorized into the absolute must do cannot fail on this or we we will be sunk we're not gonna meet our goals there's a maybe list that initially is quite big there's an eliminate list which is usually very small to begin with and a delay list which means we're gonna get to that next year it's not quite as high priority as something else and then after you get that maybe list done then you have to go through it one more time and break it into one of these other three categories again I'll show you a little more detail in just a minute here after you have that then you know that's the process of deciding what you are gonna do and gaining consensus around that and then you create the plan you prioritize it and create the plan then after the activity there's a lot you have to do to manage that plan on our ongoing basis and this is where I see a lot of organizations really fall apart is they'll get this pretty plan and they may even get great consensus around the plan and then the plan isn't managed and so you know three months later or four months later chaos has ensued because no one really is monitoring and managing that plan so one of the stories that I've heard about Alan Mulally at Ford I actually have heard it several times once from him to twice from people that report to him is that he's just a master at those weekly meetings to manage their plans and I'll talk a little more about that when we get into plans but you know you've gotta manage a plan or it's not gonna happen there's just too many distractions that are too tempting so that's something you've got to do all right so let's start at the beginning what do you do exactly for the pre work so the first thing is moving from this point of ambiguity and possibly disagreement across the senior leadership team to an area of clarity on what the business needs really armed in the outstanding organization I suggest you can use SWOT analyses you can use you know any number of other competitive analyses but the point is taking the time to reflect seriously and talk and this requires talking together a leadership team saying this is truly what our goals are and the other thing that I find interesting is that strategy is a tricky word a lot of people throw the word strategy around when it's really not strategy in my opinion that they're talking about so strategy business strategy would be things like you know the types of product mixes that you want to have or the the markets you want to be in or you know the way you want to go about being in the world you know those are those are strategies the annual priorities for executing on a strategy or are that they're priorities that it's it's the work plan that you're going to use to execute your strategy so I think you're probably seeing already that one of the pre consisting conditions that needs to be in place in order to have great success with this ocean planning is clarity around what the business strategy really is so a lot of times when I start working with an organization who wants to do hoshin planning you know when I get in they're all find out they don't really even have a clear strategy and so I will often say no to the to the engagement and have them work with someone who is far better experienced in setting a true business strategy than I am I'm an ops gal I'm an execution gal and so you know you go hire someone who who's great with strategic planning and get a real strategic plan in place and not a five-year plan not a ten-year plan you know maybe a two or three-year plan at the most at the most three years so they can go and do that but they have to have the clarity and the reason why they need to have clarity is the senior leadership team and the board by the way need to be aligned on what really matters and to whom does it matter and why are we doing these things there needs to be great alignment around those three questions in order to not have this kind of chaos filled environment because that you didn't have clarity on these on these top questions so then another thing that has to happen is this this very truthful reflection on where the organization is in terms of its current performance and its position in the marketplace community how are we really doing where are we having problems and so you know you're already probably seeing that this takes a fair amount of leadership maturity in order to do well with this hoshin planning it does require a very honest assessment of where problems are and you know I've heard from so many people that leaders don't want to know about problems by and large and I've worked with so many executives that say that's so not true we do want to know about the problems that you know it's it's a mix I mean sometimes they really they say they do but they don't and sometimes they really do and people misinterpret something I mean they're afraid to tell people tell executives the truth but you know being at the top I will say this I I do work enough with executives and I've been close to the top myself it's a really lonely place at the top because people don't tell you the truth and you know you might want to test out your leadership team and see if they really do want to know the truth or they don't and if you get your hand smacks then you know what the what the reality is but to assume that a leader doesn't want to know the truth is a tricky place to be it's a it's a slippery slope and it's not a great place from a functional you know perspective within an organization it's it actually breeds a fair amount of dysfunction so then the other thing and this is the most tactical part of the pre-work I asked teams to do is I asked them to go out there pretend like they're going shopping for you know the great the great fries and they're going to get all the food they possibly can so that they can stay full and warm the during the great fries so what this is is gathering lists and lists and lists of all active projects and initiative it's all stalled projects and initiatives all planned projects and initiatives all desired projects and initiatives that aren't even on a list anywhere and all stealth and rogue projects and initiatives and these are ones that people are doing but they don't exist on a list anywhere now this stealth and rogue projects and initiatives is fascinating because everybody has them every single organization has them and surfacing those and you're bringing coming bringing those to light is so fascinating for leadership team to see what what people chose to make important versus what the leadership team thought was important and so again you have to create this really safe environment for people to tell the truth and then say well we're working on this and we're working on that and not have someone go what the heck why are you working on that you shouldn't be working on that that cannot be the response it has to be you know what it is what it is we just need a full list we're tired of being in this chaos filled environment we're gonna fix it this year let's please surface everything now after I do this with an organization of 900 employees I've done nine hundred employees three three three the last three clients in a row had 900 employees almost all three cases they came up with 50-plus items once we got rid of duplicates and we merged together the two you know two or three that were very very similar and we're really one project the initial list was 50 and I'm talking big projects I'm not talking you know move the bulletin board from this wall that wall I'm talking big projects and initiatives so that in and of itself is a very healthy necessary step for an organization to go through to surface how much is out there bubbling around and occupying psychic energy if not actual physical energy of various people within the organization so then that's when the fun begins after they bring the lists in and we start this two to three day planning session that's where the fun begins and so now I'm going to go through the mechanics of that two to three day planning session you do need to have a very seasoned facilitator and ideally that facilitator has no skin in the game so it's not gonna be like the worst facilitator would be the CEO or the CEO or a CFO or the CIO anyone in a c-level is not going to be an effective facilitator much of the time unless they're really really seasoned at facilitating and know how to be objective so basically I take flip charts flip chart pages and I put them on the wall you know I may have two for each category if they've got a lot and I'll have people write on four by six this is not three by six post-its it's four by six post-its they'll write everything on it that's on that list of 50-plus items and then they'll come to the wall and they'll start playing around with you know where where these things go and again remember the pre work that has been done is getting clarity on what really matters so now we're assuming that there's already been clarity and consensus around what really matters if the team needs that before this session you have to get that done before you're actually doing this more tactical work on creating the plan and by the way the team is typically director and above depends on the size of the leadership team you don't want more than 10 people in the room so sometimes it's VP and above depending on how large the company is and then occasionally a manager of two I will be in there but usually it's director and above so they put the post-its on the flip chart wherever they go and then the maybes as I mentioned before will be the big flip chart and then you start going through looking back at what these mission what the mission is and what the goals are and where the company is and where it wants to go you start figuring out what are the things that are must use on that maybe list and my experience has been that only about you know one or two or three of the maybe list actually come over to the must-do if if the facilitator is pushing for fewer than then larger numbers of priorities so they all let's talk about that number of priorities how many kind of company reasonably handled well it depends it depends on how many functional areas are going to be drawn on to complete each of the items on the list it depends on the kind of bandwidth that's in the organization currently because you can't do work if you don't make space to do the work some of it depends on this the sense of urgency you know a company that is operating in the red and has been for two years is gonna be in a very different place than a company who you know just wants to get a caught some comm across the organization and do things more sensibly and with lower stress and all that very very different different environments but you want to keep it to I'd say three to ten major projects or priorities and you would only go beyond five if it's a very big organization where you have lots of functional areas and they're not going to be these nice you know five plus are not going to be drawing on the same resources it's hard to give an exact number but but fewer than then more with each of my clients that had the fifty plus on the list at the end of day one we got it down to 20 and in two of the cases we were not able to get it down beyond 20 during the three day activity they had homework to do afterwards and then you know I've done some coaching by phone in one of the cases they were able to get it down to 12 and in all cases all three of them and this happened last year as well in all the cases I said that's too many you'll never get them done and they hated me for it and I was right you know a year later it say okay how many get done and they're like oh you were right so it takes organizations a while to break those habits and my style is and facilitators to push pretty hard but ultimately the client has to experience failure on their own I can't take full responsibility for that so that's that's how that goes anyway the next thing is after you take those maybes and you divvy them up to the must dues the delays and the eliminates it's worth reflecting a little bit on that elimination post and this is where some great learning comes in on how do these even get on a list begin with where did we lack clarity or who you know who was driving this and why were they driving it and you know why did that seem important and now it's not really important and those kinds of discussions just limited you know don't go on and on forever because you need the time to actually create the plan but that kind of reflection is very helpful for leadership teams so that they can break the habit of continuing to add to the list so then step four is deciding what you are gonna do what's really gonna go on that must do list and then that's when the plan you start creating the plan so what sometimes has to happen but not always is sometimes it takes a little bit of prioritization a little work of thinking through how to prioritize so in the outstanding organization on page 83 and they'll be a slide about this in a second I have a pretty extensive list of how to define ease ease like what kind of ease well you know I'll say ease in terms of the investment of time and money ease in terms of resource availability people and equipment ease in terms of logistics ease in terms of politics ease and turns in terms of external stakeholder involvement all of those things all go into that decision around ease and then same with benefit you know with benefit there's all kinds of benefits there's financial benefits customer benefits market share benefits regulatory benefits organizational internal benefits operational benefits yours there's all kinds of things so you definitely have to get some criteria that the leadership team agrees to they're going to use when they prioritize and then basically you would just number all the priorities and again you know 15 is not a good number it just happened to fit here and then they place them based on how easy they would be to implement and then what the benefit would be according to whatever criteria you set and then you would in the work plan look at executing the ones they're going to be easy and her benefit first and work through the year that way now think back to PDSA when you're actually executing the plan and you're having these regular meetings where you're reviewing the plan and considering what's going on that's when you're making adjustments based on current state issues and so one thing that's very very common is that let's just say that we execute 1721 414 and one and that's done it may be that the rest of this action and actually all the way down through to this elimination category that these could shift around because something that seemed very difficult could now become very easy something that seemed like it was gonna give a in a pretty low benefit may suddenly now give a higher benefit once you've set you know you've changed your setpoint basically so you have to you know again not get fixed on this being the priority for the entire year you have to keep looking at this and that's part of what you do during the the ongoing management meetings you know where you're looking at the plan of monitoring where you're at PDSA a adjust so then if you want to do something a little fancier and you want to put some math to the to the process then I have a prioritization grid that's on Excel that you can download from my web page on my website the book page and it's also in page 83 is that extensive list of prioritization this one gives you a third dimension in terms of the size of the bubble so a sense of urgency is now the size of the bubble bigger bubble higher urgency smaller bubbles smaller urgency and so that way if you want to consider that third dimension in making a decision you can so again what you can do is download this and it has a table you know template that you fill out and you rank the numbers it actually goes from 1 to 10 now it used to go from 1 to 7 but now 1 to 10 and then it will make the bubbles for you once you fill in the table so then you come up with a plan so here's the plan that one client I use variations of this but here's a plan that we used for one client and it remember it looks remarkably different than an X matrix or even an a3 a much more traditional view of a deployment plan but the key is that it's got the the priorities named you know right here so I remove that for confidentiality reasons it's got I'm sorry the goals and objectives so no more than you know two to five goals and objectives for the year this one this company has four and then this column here the measurable objective is in this case I took the snapshot of this at the end of day three so they had more homework to do which I didn't I didn't get from them yet and so this has what the measurables going to be how are you going to define success and then this area in here is a bit of a Gantt chart against ish chart for what they're going to when they're gonna start and end and some of the tests are year-long tasks year-long projects they're gonna take a while to execute and then this is who's the executive owner over that and then this is who's a tactical owner over that particular task so they have in this case two different kinds of meetings they have an executive meeting and then a tactical meeting and so the executives are gonna be the ones that you know are basically saying to each other what's going on why are you behind and what's you know what are your obstacles etc then this section is a new section and I do this about mmm I'd say 25 to 30 percent of the time with clients where they have concerns about resource constraints and what we do is put functional areas across the top and then rank what the level of involvement is going to be a three means that they're gonna be highly involved in that priority or that project and a one means very minimally involved so that you don't have a situation where you've got you know an entire vertical where everyone is highly involved obviously they're not going to be able to do that the other thing you can do is look at the high involvement and then go back and look at the time frames to make sure that the ones that they have high involvement in aren't occurring at the exact same time so in this case you know the first part of the year the ops people are going to be pretty darn busy and they're going to have a little bit of a reprieve during June which as to view their busy months and then they're gonna have a little more latitude later on in the year to take on some new stuff because it's not going to be quite as busy with executing some of these projects and priorities so the thing that's interesting about when you're in this three-day activity or two-day activity is that it is a facilitator it gets tricky because you have you know very strong-willed leaders often disagreeing vehemently with each other on what really matters but you got it that's it that's the point of doing it is to surface those disagreements and help them work through it always getting clear about that true north so again that's why if you don't have true north defined before you get into the two to three days it makes sealing with those disagreements impossible so again once they all agree on what the what the true north is and how they define success as an organization then figuring out which priorities should take precedence becomes a much easier not easy but easier conversation so once you get the plan done then you've got to go into your post planning stage and I recommend weekly status meetings to start most of my clients don't do weekly to be honest I I think they're making a mistake by not doing weekly to start but they you know of course say that they've got too many meetings and too much going on but um you know they miss they miss a lot of the PDSA richness that they don't do weekly meetings at least for the first month to see how they're you know not executing the way that they said they were going to and see the obstacles that are arising that they didn't know it arise and and work through it but at least you know monthly eventually and and I would not take it any less frequently than that a lot of people try to do quarterly but by the time you get to that quarterly meeting too much has happened to ever get back on track with your plan so I recommend at a the least frequent to be monthly and in those meetings someone needs to facilitate them and I recommend it not be an outsider although sometimes for the first year it's helpful to have an outsider but I recommend that it's one of the senior most executives that's now turning into the plan manager hold everyone's feet to the fire and make sure that people are following through and all that and during those meetings they could be extremely short meetings if they're extremely focused so in other words instead of talking about well the wonderful work we're doing for these items that are color-coded green and you can't see that by the way but over here on the side is a status which is red yellow green dashboard so the items that are green you don't need to talk about them other than if done and then spend most of your time on how to get the yellow and the red items into green if anything is behind and then the expectation of the team and the agreement the terms of the terms of engagement for those sessions is it the full team helps remove obstacles so this starts breeding this holistic team oriented approach to solving problems across an organization which often is a pretty big leap for companies to do like in other words you know I just had this yesterday with this client where there's one thing going on in one area and that one area is you know current state they're kind of on their own to solve it like no one else is really chipping in to help them solve the problem because they've all got their plates full name but I've got their own problems well that's not gonna work in a holistic environment everyone has to help everyone and so that is the expectation and you're using those meetings to start shifting the culture and and in transitioning that siloed based behavior and thinking into more holistic behavior and thinking and then the other thing is is that the tone during those meetings can be rather tough I mean it shouldn't be mean and it shouldn't be punitive and Blamey or anything like that but it can be tough on look we committed to this what's going on why are you not you know why are you not able to get to this and how can we help you get to this that this is this is a commitment unless something has changed that makes this priority no longer the highest priority and if that's the case let's talk about that and let's flex the plan but the plans the plan um unless it's flexed for good reason so you know I you have to pick the the facilitator for that across leadership team pretty pretty wisely based on who has respect and who can be tough and that type of thing and then the other thing is is that most organizations I find hide hide there with her plans I don't mean they hide them from view intentionally but they put them in a computer and that defeats the whole point of having this plan that is starting to heighten the awareness to how much distraction comes our way and how we're gonna resist that distraction is you posting the plan and letting everyone see that the organization is sticking to its plan with those those rare exceptions where something comes at all the field and you need to adjust so posting posting posting really matters and then the other thing is is that in those meetings you're starting to consider these you know these temptations these new shiny balls that are out there and someone's saying oh we should do this well we should do that my rule of thumb is always okay if the if the priority or the project has not been started yet if a project or priority hasn't been started yet and this new shiny ball is that high of a priority then it can go in and swap out something but something has to come off that plan in order for something to come on that plan and it needs to be of the kind of similar work effort if everything has already been started then by bringing in a new shiny ball it better be really important and an urgent kind of thing in order to take that lost work and and basically toss it in the in a waste can because that's what it amounts to when you take people off a project and put a new one in place so that's that's just something to think about is you know how you manage the distractions but that's where the honest dialogue happens so they don't become rogue or stealth projects so that's kind of the technical or the mechanical way of going through the plan and plan management in a nutshell very quick but the next thing to think about is that how you get how you really enforce those leadership behaviors and cultural shifts so I'll share with you something that happened yesterday at a client I had five people come up to me that were not in the c-level the right below sea level after we had a very candid discussion about the need to do fewer things at once and to get focus and they all pointed to the same executive and said it's never gonna happen there's no way he's gonna let us have this New World Order and what I asked them to do was to suspend their disbelief because I had had some conversations with him and he really is starting to understand that he's been kind of guilty of leading the organization down a bunch of blind alleys and and having a lot of organizational ad D because he himself has a hard time focusing and so we it was a really good discussion with him actually and these these other leaders I said you know I just I just think you need to just I know you have history with him with doing that just let's just keep going down this path and let's see how it goes and you know I don't know I'm gonna be there next week we'll see we'll see how it's going but it's um you know it's often leaders get into leadership positions because they can accomplish a lot and oftentimes leaders are are you know pretty into the ad D saying that have to recognize it it's a problem and then make the changes to to get the problem to go away but here's what's even more difficult than getting leaders to stick with a plan and not be subject to it to unnecessary ad D it's getting them to let people who are closer to the work help in creating those priorities so the necessary shift that has to happen is from you know we have all the answers to what do you think and I mean eventually going all the way to the front lines what do you think what do you think is important what should be working on from your perspective so the first thing I hear from executives is well that they're they're going to look at us like we're idiots if we ask that question because they're they think that we should be figuring this out well you have to set it up you absolutely have to set it up and help people understand why you're shifting and why you're starting to ask those questions it isn't because leaders are being lazy bunch and they don't want to do the heavy thinking and and putting strategy together it's because they truly want the input of the people who do the work so that the plan is really good so there definitely are some upfront things you have to do to set the right stage but even more importantly is getting people to see that it's a value to operate this way so let's come back to that in a moment and move forward to what catch ball is and what catch ball can do for an organization in terms of shifting culture and leadership behaviors so catch ball the word is you know a great descriptor of you know just picture to people out in the field catch throw in the ball toss in the ball back to back and forth to each other toss toss toss toss toss that's why it's called catch ball it's kind of like the Native American practice of a talking stick where if you want to say something you know you you get the talking stick and it allows everyone to be heard it's a very egalitarian way to make sure that everyone is heard when there's something being discussed and the more intense the discussion the more important that's talking Talking Stick becomes so it's a little bit similar to that if some of you are familiar with that but basically what this has to happen this just transition into this kind of behavior has to happen in stages it does not happen overnight so ultimately what you're looking for is the executive team to be heavily engaged in thinking through strategy all year long and thinking about what the next year's priorities need to be from their perspective all year long and they're getting lots and lots of data all year long from customers from going to the gemba both at the customer side and internally from talking to the front lines and middle managers from looking out they're looking out a monk you know into the marketplace and seeing what's coming your way and looking on being sensitive to political discussions you know in Washington I mean as far as upcoming regulations and things like that so ideally they're not micromanaging and having to deal with minutiae they're out there you're thinking the big picture all year long so let's just say that that happens then what happen they're getting close to starting the planning process the executive goes to the next level down in the organization assuming a hierarchical organization and they say well what do you think here's what we're thinking what do you think and it's not getting by in to their ideas it's getting true feedback it's a collaborative discussion about what really matters and senior management's ideas are heavily listened to and you know they have to give of course they're they're wise and all that stuff to the executive team but it's a collaboration or what matters so that's where the the ball catching is you know we toss the ball you you toss it back to us and it goes round and round a little bit and then at some point when the organization gets mature enough after it's gone one level then they take it down to another level and they do the same thing what do you think here's what we think and sometimes there'll be a new discovery at the middle management level which requires it to go all the way back up to the executive team and kind of cycle down through again a new idea that's like oh I think we should be doing this that's a good idea let's talk about that and that can happen and then it can go down in a mature organization to the frontline same thing and sometimes the same thing happens where the front lines say we should be working on this so what I recommend for most organizations is sometimes it really is just the executive team with senior management getting together for the first year and gaining consensus and with every client I've worked with this is where we have started we didn't go all the way to middle management on the first year because it was monumental for them to agree on fewer priorities and to have true consensus around those priorities then the second year I always recommend that they take it then down to the next level and then the third year take it down all the way to the frontlines because it takes a fair amount of coaching and development for leaders to be effective doing this catch ball thing all the way down to the front lines but it is so wildly wildly powerful to see the organization's evolving into this I love it it's one of the one of the most fascinating and thrilling parts of the kind of work I do so the other thing is this this practice of going to the gemba is unnecessary parallel activity that you have to be working with leadership on so that they're in a position to even give good ideas if they're not regularly going to the Gumba and talking with customers and employees and suppliers and getting all of that rich data that they need to make good decisions then they're gonna be a bit handicapped on what really matters to the organization so you know Ginni I talked about Ginny in length at length in the outstanding organization but she's just been such a great student of lean and has done some amazing transformation at Franklin Templeton in large part because of her willingness to break her leadership paradigms and trying new ways of leading and you can read more of her story about how how how powerful this has been for both her personally and for her team and then ultimately for Franklin Templeton as a company so what we want to do is break these this habit of being very functionally oriented and that also means that eventually performance reviews of individuals incentives and bonuses that are given that whole supportive kind of network and that the cobweb of connects with what connects this organization together and has it behave as it does ultimately all of that has to be challenged you know giving individual departments kudos for performing to certain metrics that are departments specific metrics drives departments specific improvement and it drives departments specific behavior and it does not go very well with a value stream mentality or looking at flow across systems so it's you just have to really be ready if you're going to take this seriously to do some some deep diving into supportive behaviors and and existing infrastructure to support this this process now that's not to say that you need to change your org chart that's not why the org charts showing here you have to change the behaviors and the thinking the mindsets and behaviors of leaders so here's what can happen if you do this should you accept this mission here's pack teeth they started strategy deployment in the kind of middle part of oh seven and preparation 408 and they report that there were very few other variables that in a you know very few other improvements they made that allowed them to see these monumental jumps and productivity simply because they were focused on fewer fewer improvements to be made at one time and because they had leadership consensus around what those were so everyone down the front lines knew what to do there wasn't any guessing and so they were able to get great productivity gains because of that here's another case Rockwell Automation they before they had any kind of focus through strategy deployment they were having about 20 items priorities and projects on their list every year and executing around three of them and then after it they dropped that list of 20 to 12 and the very first year after they did that and stuck to their guns they completed all 12 with very high quality so this is a great example of you know what would you rather have three or 12 I'll take 12 thank you very much well then you have to start with 12 not not 20 in order to get that that switch tasking robs people of so much psychic and actual energy it just you know it doesn't it doesn't bode well for an organization performing well so what it takes in order to achieve this is a fair amount of clarity and consensus and courage so the courage part of it is it's hard to say no to things and when I work with you know first time companies going through this it's it's hard on that first day when they're putting things on to the eliminate list or the delay list it you know they have a really hard time seeing how they're gonna succeed as a company by doing fewer things but it's not really doing fewer things it's just doing fewer things at once that's what the difference is and then that commitment to weather the storm when other shiny balls are appearing is the part that that those ongoing management meetings will help you with so you have to have that clarity consensus and courage and commitment in order to stick with the plan in order for this to work and I start with this with the leadership teams and say you know should you want to go down this path this is what has to happen are you sure you want to go down this path because if they're not ready they're not ready um and you know if you get at least 75% of them being ready that's usually enough to be able to pull the others along or it gives great clarity that some of them need to go and you know go work for another company that doesn't care about focus so that's it for a very brief overview of something that's a pretty you know involved process I'm gonna go ahead and go to questions please feel free if you don't already subscribe to subscribe to the blog a newsletter and join me on social media and I'm gonna start with the two questions that came in during registration and then I'll go to the ones that are coming in right now so the first one is how do we relate hoshin kanri to the balanced scorecard method for strategic management and measurement it's a great question so I have a little bit of a bias about violent scorecard that I'll share publicly and that's the I think the word balanced is absolutely important and and certainly most organizations before balanced scorecard was introduced did not have balance in what they were measuring and even now even with balanced scorecard I still see them organizations that use it being heavily weighted toward financial metrics and not as balanced on the operational metrics I also see them forcing the people metrics and not really believing that that's really what really matters and so I see a lot of kind of gaming going on for the sake of a balanced scorecard so what I like to suggest is that you know you definitely approach the annual goals and objectives the measurable objectives from a balanced perspective but you know what there could be years where it can't be totally balanced there could be years where if an organization is about to go belly-up where it may need to be almost all financial metrics with some operational in there and you know there just may be years very very thoughtful unbalanced in balance may be needed but it needs to be thoughtful and for very compelling reasons so I think they're you know complimentary certainly but I think they're little competing and I don't know why you need both I I don't I don't think that you gain much by kind of bringing balanced scorecard which is a specific methodology into hoshin kanri which is a specific methodology I think I think hoshin kanri can kind of cover it all so that's my bias and and I'm I'm admitting that all right so next and how does this work in a highly siloed organization so I think I've answered that but if I haven't go ahead and ask some more follow-up questions because it it really you know it does start breaking down those silos in terms of looking at resources and I'll tell you I share you with you a quick story about a client two years ago I was working with them for the first year on hoshin kanri and there was a VP of Sales that was adamant that they had to get this new customer portal in place the next fiscal year that the market was demanding it and they were gonna lose business to the competition and all the stuff and the rest of the executive team just didn't buy it and they said you know prove it to us give us some data you know give us even if it's anecdotal give us data that proves that that's more important than getting handheld devices to the field technicians so that we can build properly and so that they can do their time cards real time and not be doing them in the evenings when they should be with their family so that it was on day one day two the conversation continued and this is where consensus shines eventually this VP of Sales was able to reach consensus with the rest of the team and that went on the delay that that customer portal went on the delay list consensus does not mean full agreement and we often think that and that's not the case what it means its commitment so consensus is committing to a direction and not you know sabotaging it after the meeting and not saying I'm not gonna follow that it's true true commitment and when I facilitate that's what I kind of demand from the team it was please let's talk about this if you don't like it if you don't agree let's talk about it now not after we leave this room and you know I really encourage those kinds of and kind of force those conversations if I see it in body language and it's not being verbalized and so that's that's what can happen he wanted his thing for his silo but the IT resources simply weren't there to also give the field their thing and so you know there had to be a decision and it takes mature leaders and that it's not easy facilitating this stuff all right so those are great questions thank you now I'm gonna go to the ones coming in from the the listeners today of yours today are you familiar with a study from the 2005 Harvard University Press that showed that ninety percent of companies fail to execute their strategies if so do you know if this has been updated it's a question from skip I don't know if I know that I mean there's this that data sounds familiar to me but I don't have it the tip of my tongue and I'm pretty sure I don't have it downloaded so 90% of the companies fail to execute their strategies yeah that doesn't surprise me so no I if you have any access to that skip I'd love to see that I can also google afterwards thank you that okay France question is this correct to say that hoshin should be done after you've done the VSM for the organization I see hoshin as the how you deliver the value the what is this correct um I would say not necessarily so let's just talk about value stream mapping first conceptually so value stream mapping is used when you want to improve the value stream so it could be that there is a mission or you know a goal and objective that the company has that is going to require you to get much better performance across a value stream in order to achieve that and if that's the case like let's just say for example that you want to grow market share in an area that is buying more of one product line and that product line happens to have a value stream that's fairly inconsistent with performance or whatever then you know you might want to be focus on improving that value stream as one of the priorities for that year in order to be able to move into that market and have that you know value stream be delivering as it needs to in order to be successful in that market or it might be that you have a pricing problem and you want to be able to reduce pricing and in order to do that you've got to reduce operational expense and you know that and so there might be a need to look at value stream mapping as a tool to look across the value stream for reducing expenses and so forth it could be quality I mean you name it it could be it so I would say that value stream mapping is most of the time you know the what and the how thing is an interesting discussion because there's macro levels and micro levels so at a macro level you've got a big bbb-big what and then you have the how well that how becomes a mid level what to a lower level how and then that how it becomes I hope this is making sense but there there are different shades of what and how depending on how macro you are so I would say that the ocean plan is macro macro and value stream mapping would be something to support it you can call it what or how however you want to but that's that's what I would say if any of you have a different opinion you know feel free to note it in the questions and I'll and I'll read it to the group okay we've got three more minutes um okay one person has asked that they've left let me read this real quickly as you select strategic priorities should you take a balanced approach that is selecting quality growth financial people etc he must have asked us before we talked about balanced scorecards if it's relevant yes I mean I balance is always important but there are times when thoughtful imbalance is called for so you know it really depends you don't force four categories on organizations that don't need it next question can this be used from proving operational performance this meeting hoshin kanri yes this this is the driver this is the blueprint this is the you know the plan that improving operational performance is being done to support I hope that I hope that's clear next question is it possible to execute strategy deployment via the primary values trips up the so great minds think alike so hopefully I've answered that question please let me know if you want me to go into a little greater detail on that one next one so far we've only seen new projects and a development in this presentation so far we have seen only new projects and development in this presentation I don't understand I'm sorry um if you could please clarify what what what are you looking for that would help me thank you okay next question in a highly entrenched governmental organization how do you avoid overcome embrace pushback on implementation of lean processes among line staff how do you avoid so avoid lean processes the implementation of lean processes and overcome in a highly entrenched governmental organization how do you avoid slash overcome slash embrace slash pushback on implementation of lean processes among line staff are you saying that the line staff is kind of going off and doing their own thing that doesn't support the larger plan Melinda if you could please clarify that would be helpful for me I'm not sure I'm understanding and we've got well it's 12:15 so let me see if there's any so if you could just raise your hand Melinda and the bear if either one of you are clarifying if you could just click your little hand so I know to hang on that you're gonna clarify okay all right Melinda's clarifying the reason why I'm hanging I'm kind of paranoid to get it done at 12:15 is it yesterday we went about five minutes late and someone said that they thought that was really unfair to go late because they time you know their schedule really tightly and they don't want to miss any of the action and so they're they're always frustrated if they go if I go late because they don't know whether they can't stay and they want to stay and bla bla bla I'm trying to trying to stay on the schedule here okay so the bar says okay thanks yeah so the bar please a bear please let me know if there's something that you were looking for you didn't get when you when you do your your evaluation so when you exit if don't don't exit out of your browser hit the file exit on your control panel and that will give you the the evaluation which would be helpful to let me know what you're looking for okay thanks Melinda for the clarification no they just push back and don't want to accept the changes ah okay Melinda okay they they just push back and don't want to accept the changes so I guess my question would be and this is a whole other webinar how are they being involved in designing the changes and I'm gonna leave it with that and that's subject of another webinar so take a look at Kaizen events take a look at some of the employee engagement webinars I've done and feel free to you know keep coming to these webinars to learn about employee designs improvement and what that does to reduce resistance it's a pretty powerful thing so thank you so much really appreciate you all being on here and I'll see you in about a month when we start a series of value stream mapping work webinars they're gonna be very focused on a deeper dive than even then what's even in the new book that has come out so thanks very much have a great day or great evening wherever you are and have a wonderful holiday season wherever you are as well thank you bye bye

Channel: TKMG, Inc. and TKMG Academy, Inc.

Views: 65,155

Rating: 4.7585301 out of 5

Keywords: lean, six sigma, BPR, reengineering, process improvement, continuous improvement, kaizen, value stream mapping, process design, Toyota, strategy, hoshin kanri, results

Id: wJGGfkvmjtU

Length: 77min 23sec (4643 seconds)

Published: Thu Dec 05 2013