One of the most difficult tasks of an organisation´s leadership is to execute the vision, mission and strategy. It´s pretty easy to describe the ambitions, but difficult to execute and more difficult to sustain the strategic intent. The IPMA Organisational Competence Baseline (IPMA OCB®) describes in Chapter 3.3 what needs to be done in order to get from Vision, Mission and Strategy to results by applying project, programme and portfolio management. One of the approaches for making this happen is “Hoshin Kanri”, an approach developed in Japan after the war and part of the Lean Management Philosophy.

Hoshin Kanri means “Policy Deployment” or “Direction Setting”, the compass is often shown as symbol of the approach. The first step of the process means to formulate the strategic objectives for the coming three to five years. One of the tools for the formulation of those goals could be the Balanced Scorecard unfolding in the dimensions of “customers”, “financials”, “internal business processes” and “learning and growth”. The Hoshin Kanri Process will break those objectives now down into the annual objectives (what do we want to achieve next year?). So far, we did not define the deployment of the objectives. Now, we do need to define the priorities of our daily operations, or how projects, programmes and the portfolios are linked to the organisation´s high-level ambitions.

The X-Matrix shown in the illustration above (Source: The LeanMethods Group) helps to align the long-term and annual objectives with the short- and medium-term activities, which are basically projects and programmes, bundled in portfolios. Basically, with the help of the X-Matrix the long-term objectives of an organisation are cascaded down to the operational level and can verified bottom-up through (e.g. resource) planning, controlling and reporting. The alignment keeps people focused and integrates different perspectives, making sure that all projects, programmes and portfolios contribute to the strategy.

The alignment of all objectives, from a strategic to a project level, should be described in a systematic way, using Key Performance Indicators (KPIs), target values for each KPI and measures for achieving results. Hoshin Kanri is often linked to the Plan-Do-Check-Act (PDCA) Cycle of continuous improvement, which means that on a regular basis the objectives, KPIs and measures need to be reviewed and improved. Thus, the process is a dynamic process, adapting to the dynamic context of the organisation´s environment and providing the basis for sustainable success.