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Strategy Maps (Kaplan Norton) |
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Picturing and communicating how an organization can create value: connecting strategic objectives in cause and effect relationships with each other. Explanation of Strategy Maps of Kaplan and Norton ('92, '01). |
What are Strategy Maps? DescriptionIn 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.
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| Carlos Brown - USA | Online or DVD Training Materials on BSC / Strategy Maps | "I am in quest of e-learning or DVD informal training related to: - Strategy Plan development; - Strategy Map development - Balanced Scorecard / Dashboard development - Aligning Strategy with action plan Any idea who I can contact for additional information?" |
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| Mohamed Salem - Egypt | BSC as Strategy for Change? | "(How) Can we use the Balanced Scorecard as a strategy for organizational change?" |
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| Jeswan SinghPS - Malaysia | 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 answers and appropriate data on the implementation and the translation to results of the strategy - this is where Strategy Maps (SMs) come into play. - They facilitate further the value adding process of senior and line management. - They provide direction and show the way for successful implementation of agreed Business strategy." |
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| Luis Villegas - Mexico | 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?
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| Sam - Australia | BSC | "Does the strategy map tell the same story of Balanced Scorecard? Both of them are talking about these four perspectives." |
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| └► Baran Samandi (Iran) | Strategy Map Strength | "A strategy Map displays only pure strategy to demonstrate the core Business Strategy to relevant stakeholders and managers." |
| └► Gaia (Italy) | Problems with Strategy Maps | "Problems about implementation could be: time/resources management, training and trading interests." | |
| └► Jason Kent (United States) | Benefit | "I've seen/experienced that an organization's sense of urgency results in moving forward too quickly without proper planning. I've facilitated small workshops at the beginning of a change initiative, for example, to get people around a table brainstorming about the items in a strategy map (like the one on this page) so that they at least understand all the nuances that exist. It also gets them thinking early on about the effects (positive and negative) on others (such as a client) which can easily be overlooked, as well as starting to identify key stakeholders to make sure the change initiative runs more smoothly. The project/change typically moves forward before all of the details are hashed out but at least this "time out" provides a checklist so that everyone understands what is (or should be) involved in implementing a new strategy." | |
| └► Bob (Thailand) | Advance SMap / BSCard | "The original BSC does not address risk and uncertainty which are one of the major reasons for the current financial crisis. One should consider to integrate other tools (Scenario Analysis, Risk Management, War Gaming) to make the strategies future, time and competitor proved. Original BSC is not sufficient to response to current crisis." | |
| └► Guusje (Belgium) | Limitation of Strategy Maps | "One obvious yet very important limitation of Strategy Maps is that they do not help at all to devise and formulate the right strategy. It is a tool to COMMUNICATE a strategy once it is devised and formulated." | |
| └► Anderson Su (Taiwan) | The Customer Perspective in Strategy Map | "The customer perspective in strategy map should be difined in feasible. How to suit the customer requirements that is always challenge our company, now we are using QFD to screen the customer's needs and then transfer to R&D side for developing the right products and reducing time into market." |
| └► Andrew White (UK) | BSC | "I think this means 'range of offering' for example a number of products available that might meet a customer's requirements, perhaps with varying functionality..." | |
| └► Rob Siwicki (UK) | BSC | "Hi. I believe selection actually means selection of customers. How do we select the customers we target. The 'range of offering' refers to selection in the value proposition - which is different." | |
| └► Jeswan SinghPS (Malaysia) | Selection - Product/Service attribute | "As the above attribute falls within the CUSTOMER perspective, it refers also to the choice of geographical boundary targetted by the product/service provider. This is why the BSC provides a succint, clear and complete picture of an organisation' business strategy elements. The BSC also enumerates the key accountabilities of those tasked with the achievement of the strategies." |
| └► Dennis Webbers (The Netherlands) | BSC and Strategy Maps | "The strategy map concept was designed by the same authors (Kaplan & Norton) and is a more practical approach to combine the assets of an organisation to methods to create value. I find especially the visual aspect of strategy maps appealing." | |
| └► Dee (Zimbabwe) | Difference BSC and Strategy Maps | "Strategy maps help clarify the strategy and the related strategic objectives whereas balanced scorecards are used to establish metrics and targets to measure and manage the performance of the organization against those strategic objectives." |
| └► Al (NL) | synergy in strategy maps | "I believe you can, by creating a new map on the higher level" | |
| └► Stephen (USA) | Higher Level Targets | "Yes, I did one for my company and the challenge is to find the right quantification of the corporate synergy goals. If you act in a non fact based corporate culture you will obviously have a hard time selling this." | |
| └► Patricia (Algeria) | Corporate Strategy Maps | "How do we implement a strategy map at the corporate level as opposed to at business unit level?" | |
| └► Gaia (Italy) | Corporate Synergy? | "I think corporate level have to be the sponsor on "thinking and acting in according to BSC". Nice your question, but what do you mean, exactly, with corporate level synergy effects?" |