Any strategy map has four perspectives: financial, customer, internal processes, learning and growth.  In other words this is everything that can happen to a company.  This is to say that these perspectives cover all processes in the company.

Creation of a strategy map is a very convenient way to visualize company strategy.  There is no need to collect different documents and plans and bring them together.  Strategy map includes all the elements to represent company strategy and the way strategic goals will be implemented.  Strategy map is an easy to use document and a perfect way to present company strategy to its personnel, top management, owners and shareholders.

Strategy map in BSC Designer

It has been observed that customers mostly pay attention to strategy tree when using BSC Designer, although a strategy map is an extremely important element of balanced scorecard.  It should be noted that the traditional procedure of implementing balanced scorecard implies creation of a strategy maps which can then be converted into a strategy tree.  BSC designer has the reverse procedure.  One should first create a strategy tree which can then be converted into a strategy map.

One of the greatest advantages of a strategy map in BSC Designer is that it supports full cycle of balanced scorecard implementation: from setting strategic goals, to selection of KPIs, their analysis and evaluation to adoption of response measures and even introduction of amendments to balanced scorecard.

Besides, when changes to their strategy tree are introduced they will be automatically represented in the strategy map.  Unfortunately, this feature doesn’t work backwards.  So, if amendments to a strategy maps were introduced, a strategy tree needs to be changed manually.

Strategy map is a core element of balanced scorecard

Strategy map in BSC designer is not just a static picture but the structure of active elements which can be amended and corrected if necessary.  It is possible to use strategy map feature as an average designing program.  BSC designer offers special tools to complement and amend strategy map like arrows, lines, geometrical figures etc.  Let’s review key designing features and elements specifically used to create schemes, charts and strategic plans. Features will be divided into 4 groups, based on their core functions.

1. New rectangle. New text. These features make it possible to add rectangles with blocks of text, or just text alone to any part of a strategy map. When adding a new rectangle with text one can adjust its color in the left side panel. These features can be used to add some comments, names of new measures etc.

Add rectangles with text to strategy map in BSC Designer

2. Geometrical figures and floating line.

Floating line. This tool can be used to link two objects placed on balanced scorecard.  Size and direction of the floating line are adjustable.  Besides, it is possible to change its position any time.

Rectangles, triangles and arrows. These elements have the same function as the floating line with the only difference that they look more noticeable, and thus can be used to point important links on the strategy map.  Here users have and a wide range of figures according to their needs or aesthetic preferences.

Use floating lines to connect strategy map components

Make emphasis with noticeable arrows (colors are adjusted)

Use additional figures in strategy map

3. Images and fixed lines.

It is possible to add images to a strategy map.  Please note that images are not automatically adjusted to strategy maps sites, thus make sure only small images are uploaded.

Fixed lines can link elements of balanced scorecard although cannot be moved to a different location once applied.  The good news is that it’s possible to use curves and wavies.  It goes without saying that any element on the strategy map can be deleted.

Add images to strategy map

Curves and wavies are available in strategy map toolkit

1. 4. Zooming

Zoom strategy map

The three buttons in the zooming section will zoom in and out the strategy map as well as restore it to actual size.

It is possible to draw a strategy map report which is saved in HTML extension.  The report contains various forms of the strategy map design, like default placement, horizontal tree placement, snowflake tree replacement, classical placement, cascading placement etc.

Generate strategy map report

Cascading report placement

Snowflake report placement

• A brief background of strategy maps.
• How to apply strategy maps to help you set and reach your goals.
• Examples of strategy maps, with success stories and critiques.
• Step-by-step instructions to help you design your strategy maps, update them, and integrate them into your business processes.
• And a checklist to help you design good, effective strategy maps for your company.

• We’ll explain the process in “How to calculate performance indicators, step-by-step.
• We’ll cover perspectives and metrics.
• Weights and scores.
• And step-by-step, how to calculate your performance and normalization.

The Balanced Scorecard Toolkit:

• Provides valuable information for each stage of your Balanced Scorecard life cycle;
• It is a source of ready-to-use guides, check lists, and step-by-step manuals;
• And the Toolkit includes more than 280 pages of presentation slides.
• Learn more about BSC Toolkit.

Checklist on designing good strategy maps

This slide is for demonstration purposes only. Check the Business Strategy Map homepage for details and full version.

Checklist on designing good strategy maps

• Strategy maps must depict critical information in simple manner

IT strategy map - enhance IT solution

Critique: An IT strategy map gives a framework to achieve an IT objective. For example, let’s consider the objective is to enhance IT solution.

The Learning and Development Perspective aims at enhancing database, systems and networks, implementing proven information technology and get training on working of new software. Internal Perspective focus at developing processes for networking throughout the organization and with stakeholders as well, appointing technically skilled staff, and maintaining IT standards. The customer perspective focuses at providing the required quality and quantity of products as desired by customers. The Financial Perspective aims at improving cost structure, increasing asset utilization and formulating cost-benefit analysis of each new software or technology before implementing.

Strategy maps success stories. Case III- Rotomac Shipping INC

Rotomac Shipping Inc, a leading shipping corporation based out of Panama, had an enviable record as a efficient shipping corporation with a strong fiscal performance spanning across decades. However in recent years, increasing oil prices and tendency of suppliers to lay stress on unconventional shipping routes has started to take an effect on both its profitability and operation efficiency. The management of RSI led by Clark Smith, was striving to streamline the operations for the last 2 years and yet were not able to align their strategic goals with operational plans. Exasperated at the continuous failure to structure the working, the management finally decided to take help of Zelcosm Consulting, a core BPR firm specializing in the shipping industry.

In their very first meeting with Clark, executives from Zelcosm asked the management to devise a balance scorecard for the company and also design overall and functional strategy maps. After series of deliberations, a strategy paradigm was identified for RSI and series of strategy maps were devised to present it in a manner that different stakeholders can identify what was expected from them.

With the help of strategy maps and some guidance form industry consultants, RSI was able to streamline its operations and increase work efficiency by a substantial level within a year. The company incidentally saw a 23 percent increase in its net profits while total sales increase hovered around a meager 8 percent and this fact was a testament of the level of profitability that the company was able to derive out the usage of strategy maps.

Goals and applications of strategy maps:

1. Strategy Maps are developed with keeping in mind business objectives and aims for long term profitability and illustrates a lined chain of events that contribute to the subsequent business ambition.
   For any commercial business entity, a strategy map covers tactical approaches to achieve its business goals with the assistance of diverse tools that depicts a cause and effect relationship between the different components or key performance indicators in a balanced scorecard to reach out to the requisite business deliverables.
2. Strategy maps have varied goals for diverse verticals and specific purposes, most likely for strategic alignment and measurement of business processes along with planned appraisals to scrutinize performance and subsequently manage them efficiently and furthermore to use the strategy maps in generating consensus around the calculated business objectives and strive to facilitate effective communication of same to all stakeholders and creating a picture encompassing all the objectives and making it clearly visible and descriptive to comprehend and follow by all and arrange all the complex data into simple diagrams and eventually drive alignment.
3. Let take an example of technology implementation in an organization; it is essential to plan the business goals strategically in order to make the IT processes more purposeful and complementary to the desired governance of the department and smoothening out the processes and structures.
   The idea is to do away with extensive documentary mediums which contain the complex data in a theoretical manner covering the intricacies of input and output facets of the IT specific strategies, with a strong assessment procedure to regularly review and update the generated plans to maintain their long term relevance and significance.

A brief background of strategy maps

As businesses become more complex and diverse, the apparent need to strategize and manage the business goals in a long term perspective gains prominence.

Achieving the long term objectives and facilitating the compliance of policies, as conceptualized by the management requires a clear understanding of the business goals and the approach to be followed; and this is where Strategy Maps come into the picture.

In its simplest form a strategy map can be considered as a pictorial representation of an organization’s plans and its approach in a cause and effect relationship.

It essentially offers an elegant way to communicate to stake holders how the organization hopes to achieve its long term goals taking into view four key viewpoints namely financial perspective, customer perspective, internal perspective and learning and growth perspective.

How to design strategy maps – step by step algorithms

1. The top management builds a hypothesis pertaining to the organizational goals. The main aspect covered under a strategy map or an algorithm is the basic goal that an organization wishes to achieve and in the process build up a series of mediums linked with each other to assist in achievement of the same.
2. Top Management Brainstorms on Short listing Key goals. Prior to setting up strategic algorithms, the top management thinks over ideas contributed by the top members and picks on specific suggestions to be represented in the maps that most significantly depict the organization goals.
3. Most specific goals agreed upon. As the management members are encouraged to voice their ideas, short listed suggestions are further worked and discussed upon to be represented in the diagram as the chief objectives to be achievable with the process described.