Strategy Maps

Strategy maps are usually the result of a very in depth Balanced Scorecard exercise. They quickly help to visualize the key performance drivers, and the linkages between them, on one chart. Most people are familiar with the Balanced Scorecard concept originally introduced by Kaplan and Norton. If not, there is a great Wikipedia page and plenty of other materials available on the web.

In a nutshell, the concepts states that many firms are almost exclusively focus on financial metrics, and that they should really broaden that perspective. The authors group the metrics into four key buckets: Customers, Financial, Internal Processes and Learning & Growth. Given the broader set of metrics, many non-profit organizations and governance agencies, but also many functions within a corporation that may not have a full P&L, have found this to be a very helpful concept. Firms have applied this concept at the corporate level, and you can then cascade it down to different departments and even individual performance metrics and targets. This would optimally create perfect alignment from the detailed individual performance metrics all the way up to key corporate strategic goals.

The main idea to show a strategy map is depict each objective/metric in your balanced scorecard as a shape, usually oval or square. These shapes are then grouped by the four perspectives and lines are drawn to show the cause and effect chains.