xi
Preface
WHY I WROTE THIS BOOK
is is the story of a shoe that led to this book about Hoshin Kanri.
It was 2002 and I was ying home from Europe. It was a Friday, at the end
of a long week of business travel. Between the bumps and lurches of the
plane, I was working to put together a Strategy Formulation and Deployment
approach for our company. My rst attempt was pretty simplistic:
1. FORMULATE STRATEGY: Develop a dierentiating strategy that
results in a set of strategic objectives for the business.
2. DEPLOY THE STRATEGY: Carry out the strategy by cascad-
ing objectives down into the business units and functions, and by
launching initiatives to attack the biggest problems, improve the key
processes, and improve the overall business results.
We were using a few tools at that time:
TOOLS TO FORMULATE STRATEGY: A number of strategy for-
mulation tools, including the Balanced Scorecard (along with some
highly paid consultants)
TOOLS TO DEPLOY THE STRATEGY: e Balanced Scorecard, Lean
Six Sigma, and Project Management
xii • Preface
I remember sketching out our Current State. I will call what we were doing
back in those days Version 1.0 of an evolving Strategy Formulation and
Deployment Approach (Figure P.1). We had a toolbox with some tools. Period.
I was returning home from a trip to Switzerland where I had just met
with the managing director of a company we had recently acquired.
Gerhard and I had talked extensively (well, in retrospect, I talked a lot
while he listened politely) about making signicant changes within his
business unit. I remember having the feeling as I was driving back to the
airport in Zurich that the trip had been an utter failure. Gerhard was going
to keep things the way they were before we had acquired them. I remem-
ber reecting on how the resistance to change was incredible, especially at
some of our newly acquired business units.
However, we couldn’t give up. Gerhards business unit’s Return on
Invested Capital (ROIC) was nowhere near our targeted level, and it was
imperative that we (or I) x this. Somewhere over the North Atlantic, aer
a couple of glasses of cabernet sauvignon, I remember drawing another
diagram on the back of a napkin (literally), and this diagram consisted of
a few more boxes. We will call this Version 1.1 (Figure P.2).
e process I drew consisted of four major steps, with Deploy the
Strategy broken into three pieces:
1. FORMULATE STRATEGY: Develop a dierentiating strategy that
results in a set of strategic objectives for the business.
2. CASCADE THE STRATEGY: Flow the strategic initiatives (that
came from the strategic objectives) down into the organization (via
numerous scorecards).
Tools:
Balanced Scorecard
Project Management
Lean Six Sigma
Tools:
Strategy Creation Tools
Including Balanced
Scorecard
Formulate
Strategy
Deploy the
Strategy
FIGURE P.1
Strategy Formulation and Deployment Approach: Version 1.0—A toolbox containing a
few tools.
Preface • xiii
3. EXECUTE THE STRATEGY: Attack the biggest problems, close the
biggest gaps, improve key processes, and improve the overall busi-
ness results.
4. GAIN ACCEPTANCE AND SUSTAIN THE RESULTS: Truly
engage with the employees (engage with “their hearts and minds,” as
our Human Resources people would say) to eliminate resistance to
the changes and improvements, and to sustain the hard- fought gains
once they have been achieved.
I listed the tools we were using at that time in support of each of the
four steps:
TOOL TO FORMULATE STRATEGY: Some strategy creation tools,
including the Balanced Scorecard (along with some highly paid
consultants)
TOOL TO CASCADE THE STRATEGY: e Balanced Scorecard
TOOLS TO EXECUTE THE STRATEGY: Lean Six Sigma and
Project Management
TOOLS TO GAIN ACCEPTANCE AND SUSTAIN THE RESULTS:
Nothing. Nada. Blank. We had no formal approach or a tool to help
us in this area.
Aer I returned to the States, I sent our best Lean Six Sigma black belt,
a guy I will call PhD Stan, to Switzerland to see what he could do about
helping to make the required process- related changes happen within
Gerhards business unit.
Formulate
Strategy
To
ols:
Ba
lanced Scorecard
Pl
us
Expensive Consultants
Tools:
Project Management
Lean Six Sigma
Tools:
Balanced Scorecard
Tools:
None
Deploy the Strategy
Cascade the
Strategy
Execute the
Strategy
Gain
Acceptance
and Sustain
the Results
FIGURE P.2
Strategy Formulation and Deployment Approach: Version 1.1—With more details added
on the deployment side.

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