What are Strategy Maps? Description
In the 2001 book "The Strategy-Focused Organization", Kaplan and Norton
transform their Balanced Scorecard.
In 1992 they introduced the Balanced Scorecard in the Harvard Business Review
as system to measure performance; now they change it to a strategic management
system. A lot of this transformation was done by further emphasizing the so
called Strategy Map.
Strategy Maps are diagrams that describes how an organization can create
value: by connecting strategic objectives in explicit cause and effect relationship
with each other. Via the four Balanced Scorecard perspectives: financial,
customer, processes, learning and growth. See the figure below (You can click
on the graph to download a bigger one in pdf-format). Strategy Maps are a
strategic part of the Balanced Scorecard framework to describe strategies
for value creation.
 Characteristics
of Strategy Maps
-
All of the information is contained on one page; this enables relatively
easy strategic communication.
-
There are four perspectives: Financial; Customer; Internal; Learning
and Growth.
-
The financial perspective looks at creating long-term shareholder value,
and uses a productivity strategy of improving cost structure and asset utilization
and a growth strategy of expanding opportunities and enhancing customer
value.
-
These last four elements of strategic improvement are supported by price,
quality, availability, selection, functionality, service, partnerships and
brand.
-
From an internal perspective, the operations processes and the customer
management processes help to make the product and service attributes. While
the innovation, regulatory and social processes help with relationships
and image.
-
All of these processes are supported by the allocation of human capital,
information capital and organizational capital. Organizational capital is
comprised of company culture, leadership, alignment and teamwork.
-
Connecting arrows are describing cause and effect relationships.
What are the main principles behind Strategy Maps?
- Strategy balances contradictory forces.
- Strategy is based on a differentiating customer value proposition.
- Value is added through internal business processes.
- Strategy consists of simultaneous, complementary themes.
- Strategic alignment determines the value of intangible assets.
Usage of Strategy Maps? Benefits
By connecting such things as shareholder value creation, customer management,
process management, quality management, core capabilities, innovation, human
resources, information technology, organizational design and learning with
one another in one graphical representation, Strategy Maps can help greatly
in describing the strategy and to communicate the strategy among executives
and to their employees. In this way an alignment can be created around the
strategy, which makes a successful implementation of the strategy more easy.
No small thing, bearing in mind that often, the implementation of a constructed
strategy is the biggest challenge.
Although the previous book of Kaplan and Norton already spent 64 pages on
Strategy Maps, you can find the latest, best and most comprehensive treatment
of Strategy Maps including lots of examples in the book that is mentioned
below.
Book: Robert Kaplan
and David Norton - Strategy Maps -
|
Strategy Maps in Egypt?
"I'd like to know what companies are using strategy maps in Egypt if any? Thanks for your tips..." |
|
Successful Cases which can be Shared?
"How many companies have applied a strategy map into their business so far? Is there any successful case study that can be shared to discuss? What were the advantages of using it in practice?" |
|
Managing Cross-Divisional Collaboration
"Often, achievement of a Critical Success Factor requires collaboration of two or more divisions across organizational boundaries. For example, to increase sales of new products in overseas mark..." |
|
|
Ends, Means and Strategy Map
"Under John Carver's Policy Governance Model management is driven by ends established by a board of directors. Management then develops means (goals, strategies, objectives) to mee..." |
|
|
Have you heard about OVAR ?
"OVAR is a second - similar - strategic approach that allows confontation of departments' choices. O for Objectives, VA for Value of Actions, R for Responsibilities. Every department implements the com..." |
|
Strengths of Strategy Maps
"Strategy Maps are an excellent extension to the basic framework of the Balanced Scorecard (BSC) approach.
- Business strategy statements can be catchy, but line management are often searching for..." |
|
|
Customer Perspective
"Good morning, In the Customer Perspective of the Strategy Map there is a product/service attribute called "Selection". What does it mean? Examples?
" |
|
Keep in touch with this topic
|
|
|
|
|
Strategy Maps Special Interest Group
|
|
|
|
Compare with Strategy Maps: Balanced
Scorecard |
Office of
Strategy Management |
Performance Prism |
Catalytic Mechanisms
| Intangible Assets Monitor |
People CMM
| IC Rating |
TQM
Return to Management Hub: Change & Organization | Communication & Skills | Decision-making & Valuation | Human
Resources | Knowledge & Intangibles | Strategy
More Management Methods, Models and Theory
|
|
|
|
Keep in touch with this topic
|
|
|
Options
|
|
12manage for:
|
12manage in:
|
|
|
|
|
|
Log in
