Newsletter – October, 2011

On My Mind

Leaders of companies today are searching for ways to improve from a strategic perspective as their competitors innovate and world events emerge. Hoshin kanri (policy management or policy deployment) is a strategic improvement system that originated in Japan in the 1960s. It is still widely practiced in Asia and has been integrated with the Balanced Scorecard framework (Kaplan and Norton) in some companies. Hoshin kanri involves deploying various levels of targets (expected results) and means (guidelines for achieving targets) throughout a company using a communication process called catchball in order to achieve breakthrough improvement in selected performance categories. Examples of performance categories include Quality (Q), Cost (C), Delivery (D), and Safety (S) and the Balanced Scorecard perspectives (Financial, Customer, Internal Business Processes, Learning and Growth). Statistical control charts are used to measure progress and the PDCA cycle is used to guide target-achieving activities. The value of hoshin kanri is that it prioritizes the issues facing the company and gets everyone aligned and focused on a small number of strategic goals. An advanced hoshin kanri system interfaces with a cross-functional management system and a daily management system. The book, Hoshin Kanri: Policy Deployment for Successful TQM, edited by Yoji Akao, is one of the best books in English on the topic.

Interesting Stories

I recently found a bread bag twist tie in a salad that was served to me at a restaurant. The service recovery actions by the restaurant staff were exemplary. First, the waiter apologized and took my salad back for replacement. Next, the waiter brought me a new salad, apologized again, and told me I didn’t have to pay for the salad. Finally, the restaurant manager came to our table and apologized and said the salad was free and that he hoped we came again. Very well done! I hope they did a root cause analysis in order to change their practices so that it doesn’t happen again. Service recovery is an example of Level One Problem Solving which involves an immediate fix to a problem. Root cause analysis is an example of Level Two Problem Solving which involves eliminating root causes so that the problem never occurs again.

Company News

There is still time to register for the Advanced Strategic Improvement Practices Conference to be held October 18 at the BayView Event Center near beautiful Lake Minnetonka. Fourteen speakers will be presenting on topics ranging from Innovation, Strategy, Continuous Improvement, Lean, Six Sigma, and Leadership Development. The conference brochure can be accessed at (select Annual Conference).

Intriguing Reads

It is hard to open a business magazine today without seeing the word innovation. Companies like Apple and Google continue to surprise the world with innovative new products and services forcing their competitors to respond and companies in different industries to worry. A new book titled, The Innovator’s DNA: Mastering the Five Skills of Disruptive Innovators by Jeff Dyer, Hal Gregersen, and Clayton M. Christensen explains in detail five skills that can be developed to improve a person’s ability to innovate. The five skills are Associating, Questioning, Observing, Networking, and Experimenting. These skills can help employees move from idea to impact and they can be integrated into leadership development processes.