Demystifying Hoshin Kanri Policy Deployment X-Matrix
If you are new to Hoshin Kanri (Policy Deployment), I’m sure your curiosity to learn about Hoshin Kanri (Policy Deployment) would have left you more confused about X-matrix.
This article attempts to clarify the construct of a Hoshin Kanri (Policy Deployment) X-matrix. If you haven’t already read my article, ‘What is Hoshin Kanri (Policy Deployment) X-matrix?‘ I recommend you to do so before proceeding to understand the purpose of Hoshin Kanri (Policy Deployment) X-matrix.
To briefly summarize, X-Matrix is a one page document that links an organization’s goals, strategies, metrics, strategic projects and responsible people.
First of all, there are several variations of Hoshin Kanri (Policy Deployment) X-matrix and there are no standards. Here I’m going to explain to you, a variation that most of my clients find useful.
Business/Organization Goals
At the 9 clock position of the X-matrix, the organizational goals are entered. Usually not more than 5, but preferably just 3. It is a general practice to include the targets for next 3 years for all the goals. In Hoshin Kanri(Policy Deployment), prioritization plays a critical role. So the goals are prioritized based on their importance to the organization. The most important goals are placed closer to the X. The goal on the extreme left would be least important while one on the extreme right would be more important.
Many organizations don’t prioritize goals as they feel all the goals are equally important.
Organizational Strategies
Organizational Strategies are placed in the 12 clock position. Usually not more than 7, but preferably just 5 strategies. I’m not covering the details of the how organizational strategies are arrived here, but you will find information regarding this in resources page. Strategies are also prioritized. The most important strategies are placed closer to the X. So the strategy on extreme top is least important and the one at the bottom (closer to X) is the most important one. There needs to be consensus among the organizational leaders on these strategies and their priorities.
Some organizations consider inorganic growth as a strategy by default and include it as the last strategy. But this isn’t mandatory.
Owners for Goals
Hoshin Kanri (Policy Deployment) approach prescribes individual ownership and joint accountability(IOJA). Hence each of the goals at the organizational level are owned by individual leaders. In achieving some of these goals, there will be inter dependencies. That’s where joint accountability comes into play. In the X-matrix, owners names are mentioned in the extreme right side after strategies. I’ll later mention how these are linked to the goals.
Strategic Projects
Strategic Projects (Initiatives) are be added in 6 clock position. Some organizations call strategic projects as ‘Hoshins’. Few other synonyms are Strategic Initiatives, Critical Strategic Projects, etc. These are strategic thrust areas where the leadership believes the organization has to do something different in order to achieve 1 or more goals using 1 or more strategies. There is no restriction on the number of strategic projects, but it is critical to limit the number to something that the organization can concurrently manage. Most organizations falter here. Similar to goals and strategies, strategic projects are also prioritized.
Establishing relationship between Goals, Strategies, Owners and Strategic Projects
The most common way to establish these relationship is using symbols in the intersection area of each of the above. Generally, two different symbols are used to represent strong and weak relationships. But I prefer to use numbers of a 3 point rating scale (9,3 & 1). 9 represents a strong relationship, 3 for moderate relationship and 1 for weak relationship.
So in the 10 clock position will be used to represent the relationship between goals and strategies and 2 clock position to represent the relationship between strategies and strategic initiatives.
For the relationship between goals and owners, the interaction matrix appearing next to 2 clock position will be used.
Once created, the X matrix will be a live document and needs to be reviewed and updated every month.