A Strategy Map is a custom, one-page graphic of an organization’s strategy divided into four main segments:
Financial Perspective
What growth and cost structures are required to sustain the organization and meet financial objectives? (Lag Performance Indicators)
Customer Perspective
How does your organization appear to your customers via your products, services, marketing, and community involvement? (Lag Performance Indicators)
Internal Perspective
What processes must the organization develop to produce predictable results for our customers? (Lead Performance Indicators)
Growth & Development
What investments in human, organizational, and informational capital will your organization make to facilitate success in the Internal Perspective? (Lead Performance Indicators)
Why is it important to have a Strategy Map? It is a communication tool that graphically displays your mission, vision and strategy. It is easy to highlight the 3 to 5 strategic objectives that are deemed critical in strategic planning sessions. Because the Strategy Map shows linkages and relationships between perspectives, it becomes clear where the organization will have to focus and develop its resources to ensure the success of any particular objective.
Employees and strategic partners can easily see where their work is on the map and see how their work aligns with and supports the strategic objectives. This is the foundation for employee engagement. When you involve employees in growing and improving your business, and provide time-proven systems for continuous improvement, your organization will experience higher levels of productivity and innovative problem solving.
Repeatable systems produce predictable results, and this holds true for strategic planning systems. Your Strategy Map becomes the centerpiece of each annual planning meeting. It also required to create a meaningful Balanced Scorecard, the dashboard for your company. Key performance indicators for strategic objectives are identified and tracked regularly.
The Strategy Map describes what you want to measure and the Balanced Scorecard defines the measurements. If you can’t measure it, you can’t manage it. Most strategic execution fails because it is not measured and tracked with diligence and vigor.
