Step 1.

Establish Organizational Vision

• Step 1. Establish Organizational Vision
• What is your current state with respect to your vision,
business planning processes and execution engine?
• What policies and procedures are already in place to
create and deploy objectives?
• What is the organizational structure and daily
management system?
• What are the current long-term plans?
• What are your existing vision and mission statements?
Step 2. Develop Breakthrough Objectives
• Breakthrough objectives are significant
improvements that require your
organization to stretch itself and will
take three to five years to achieve.
• To develop these, we apply a variety of
tools to identify growth opportunities,
including the four quadrants of
growth, which is an adaptation of the
Ansoff Matrix
• Using this model, we consider
consumers and non-consumers—those
who are currently using your product or
service and those who aren’t—against
current jobs and new jobs in order to
outline stretch objectives in each area
Step 3. Develop Annual Objectives
• What will you need to achieve this year in
order to reach those three- to five-year
breakthrough objectives?
• For example, if the breakthrough objective is
to “achieve industry leading closing time,”
then an annual objective might be “98 percent
of loans closed in 30 days.”
 Step 4. Deploy Annual Objectives
• How do you turn those breakthrough objectives into workable targets
and objectives at the departmental level?
• First, we develop top-level improvement priorities and then apply
metrics to them.
• Next, we create business-specific second- and third-level targets to
improve that tie directly to the top-level priorities.
• Basically, we’re cascading down to create complete alignment
throughout the entire organization.
• Each level goes down into more and more detail to where you’re seeing
the product or shipping it.
• This alignment keeps people focused and integrates
different departments, making sure everything across the entire
company aligns back up to the strategic objectives.
The Hoshin Planning Matrix, or X matrix, captures the objectives and cascading priorities. Other
tools, such as detailed action plans, summary reports and value stream maps, also help in
identifying improvement opportunities and managing progress toward achieving goals.
 Step 5. Implement Annual Objectives

• This is where improvements are executed,

using the most appropriate problem solving
approach.
 Step 6. Monthly Review
• How successful is the organization in meeting
the action plan deliverables?
• What corrective actions are needed for those
that are behind?
• A monthly review fosters a culture of
accountability and action by reviewing
progress toward achieving annual
improvement objectives
 Step 7. Annual Review
• At the end of the annual cycle, a thorough
review of the year’s objectives shows how far
ahead or behind the organization is against
the stated objectives and what adjustments
must be made to the next cycle.