Hoshin Planning

January 2000

From the Japanese phrase Hoshin Kanri

Hoshin = shining metal compass or pointing direction
  • Kanri = management or policy
  • Hoshin Planning is like a management compass that points everyone in the organization in the same direction, toward a common destination.

    DEFINITION: A planning and management system that focuses and aligns the organization to achieve breakthroughs for customers.

    Hoshin Planning does not replace other management strategies, it is a type of strategic planning system that orchestrates continuous improvement and breakthroughs. It selects the area that needs improvement, makes sure the right people get involved, and that the improvement is implemented.

    Often multiple long-term goals result from the strategic planning process. HOSHIN PLANNING process can be used to identify which goals from the long-term plan will be addressed by the entire organization during the annual planning cycles. The assumption is that the long-term plan contains more than can be accomplished in any one year that the HOSHIN PLANNING process helps to focus on vital few goals for that year.


    Six key elements that are components of HOSHIN PLANNING

    1. Focus for the organization = in the form of a few breakthrough goals that are vital to the organization's success.

    2. Commitment to customers = including targets and means at every level of the organization that are based on meeting the needs and expectations that customers rank as most important.

    3. Deployment of the organization's focus = so that employees understand their specific contributions to it. Referred to as the Golden Thread which links employees to what is important to customers and to one another.

    4. Collective wisdom to develop the plan = through a top-down, bottom-up communication and negotiating process called catchball.

    5. Tools and techniques = helpful, clear, and easy to use. Management and planning tools (affinity charts, tree diagrams, decision matrices, process decision program chart).

    6. Ongoing evaluation of progress = to facilitate learning and continuous improvement.


    Hoshin/MBO Comparison




    Organizational problem-solving for breakthroughs

    Management of individual performance


    Capabilities in meeting customer expectations

    Individual achievements

    Execution Responsibility




    Quality principles/tools

    Not specified


    Annual aligned with long-term goal

    Final reviews on results


    Periodic progress reviews on process and results

    Final reviews on results


    Vital few for competitive advantage


    Decision Basis

    Facts and data

    Data not required

    Supplementary Notes



    1. Choose the Focus

    2. Align the Organization

    3. Implement the Plan

    4. Review and Improve