When defining and executing a business strategy one needs to understand current business challenges and suggest a plan to address them. This analysis might involve an analysis of existing business processes, resources, and possible strategic alternatives. It is a good idea to map all these options visually to make the discussions around a strategy more productive.
BSC Designer is not just a drawing tool, it can visualize performance information directly on the maps and align visual appealing KPIs with the specific control points of the processes. Video manual for Strategy Maps function of BSC Designer explains in the details how to create various maps using the software.
Building a strategy map step-by-step in BSC Designer software
Here is how it might look if you create a strategy map with BSC Designer:
It is not just a nice picture. It was build automatically according to business objectives and cause and effect links between them. Some business objectives are aligned with a KPI and action plan. Also, in the right-top corner there is a small dashboard part that includes two measures that are monitoring a current state of “Sales” and “Average Response Time.”
A strategy map is a great way to map drivers of change, capture important business objectives and the cause-and-effect relationship between them. As a result managers can monitor important aspects of the business and track the progress toward assigned business goals.
A Strategy Map can and should be designed for the whole company, as well as for specific departments. It allows seeing a big picture of the business and helps to execute a strategy.
Strategy map in BSC Designer
In BSC Designer we have the Balanced Scorecard template that allows building a strategy map and aligning it with action plans and KPIs. Below is a step-by-step instruction on how to create a strategy map with business objectives linked by cause-and-effect connections.
1. Run BSC Designer and open “Balanced Scorecard Template.bsc” from “Samples” folder.
2. The most important tabs for this task are “Business Goals,””KPIs,” and “Strategy Map.”
3. Go to the “Business Goals” tab first. There you need to map your business objectives.
You can either modify business objectives that are in the template project or delete everything and start from scratch.
- I do not recommend deleting 4 basic perspectives: “Finance,” “Customers,” “Internal Processes,” “Education and growth.”
To understand the key functionality, compare how “Improve profits,” “Improve Revenue,” “Control Costs” are represented on the business goals tab and how BSC Designer software presents them on the strategy map.
On “Business goals” tab “Improve revenue” and “control costs” are child items for “Improve profits.” According to this, BSC Designer puts them on the strategy map.
On “Business goals” tab “KPI 1″ is linked to “Improve Revenue” business goal, “KPI 2″ is linked to “Control Costs” business goal. BSC Designer shows linked KPIs in the area below the business objective.
- To link a KPI to a business objective you need to choose a business objective on “Business goals” tab or on the strategy map and click “Link KPI” button. Before you can link a KPI, you need to create it on the KPIs tab.
On the strategy map you can see that some objects are linked by arrows. These arrows represent a cause and effect connection between business objectives. You can manage these connections. Go to the “Business Goals” tab, select any business objective and specify for it an appropriate business objective in “Contributes to” or “Contributed by” fields.
4. Build a strategy map
BSC Designer can build a strategy map automatically. Once you will switch to a strategy map tab, BSC Designer will detect changes made to business goals or KPIs and will suggest updating a strategy map. If you did some manual changes to a strategy map, they will be lost after a rebuild.
For a new project you need to create a strategy map with placement wizard. Select “Placement Wizard” command in a “Strategy map” menu. Then select “Balanced Scorecard” among placement styles, and click the “Execute” button.
5. Adding additional KPIs
You can add additional KPIs to the strategy map. Right-click on the strategy map and select “Add item from KPI tree.” Select an appropriate item and it will appear on the strategy map.
You can customize the new KPI item. The most interesting property is “glyph” that specifies what graphical format will be used for the KPI on the strategy map.
6. Action plan
Use initiatives in BSC Designer to align an action plan with a business objective or with a KPI. Next time you will rebuild a strategy map, BSC Designer will indicate business objectives that have initiatives attached.
7. Share your map
There are several ways to share a strategy map with employees:
- The simplest one: use “Export” command in “Strategy Map” menu. This will create an image file that you can send to your employees. Disadvantages of this approach are that your employee won’t have a real-time information about important KPIs and measures.
- Share BSC projects and your employees will be able to use BSC Designer to view a strategy map. Employees will always see the up-to-date version of the strategy map.
- If your BSC project is in BSC Designer Online then you won’t need to install software onto each desktop, your employees will be able to login and view the up-to-date version of the strategy map using any web-browser.