Kaplan and norton are gungho about the power of strategy maps to provide a conceptual framework for understanding any corporation, public institution or nonprofit organization, but general readers are likely to shake their head at jargonheavy reformulations of the obvious like the ideal customer experience is a product that meets customer. The strategic perspective that kaplan and norton have developed is very valuable. A strategy map is a model of how an organization creates value. Perspectives the link between the balanced scorecard and the strategy map becomes immediately apparent upon the introduction of the kaplan norton four perspectives. Strategy maps can help chart this difficult terrain. Kaplan and norton, translated bakhtiari, 2005 since the. Kaplan is a professor at harvard university and david p. These and other research findings help to explain why kaplan and norton believe so strongly in the power of the balanced scorecard.
It is a great read after you have read balanced scorecard and strategy focused organization. Conceptual foundations of the balanced scorecard 3. Figure 1 on the following page provides an overview of a strategy map. They provide a language that executive teams can use to discuss the direction and priorities of their enterprises. Prior to his career at palladium, dr norton cofounded and. Strategy map page 5 building strategies and strategy maps pages 7, 8 ibms complete customer solution page 8 by robert s. After reading you will understand the basics of this powerful strategy and performance management tool. Strategy maps describe how organisations create value by building on strategic. Converting intangible assets into tangible outcomes, authorrobert steven kaplan and david p. Even if the strategy map is a tool for expressing concrete strategy, it is also an instrument of information within the organization. Norton introduced the balanced scorecard, a revolutionary performance measurement system that allowed organizations to quantify intangible assets such as people, information, and customer relationships. Using the balanced scorecard as a strategic management.
How to develop a balanced scorecard into a strategy map. Kaplan and norton describe the innovation of the balanced scorecard as follows. This book will help you to stay out ofthe failed troops. Use features like bookmarks, note taking and highlighting while reading strategy maps. The strategic thinking that kaplan and norton have done is very valuable. A complete strategy map template including examples. The first diagrams of this type appeared in the early 1990s, and the idea of using this type of diagram to help document balanced scorecard was discussed in a paper by drs.
Our findings indicate that only 15 studies have dealt with the topic of strategy maps over the past 22 years. Take a look at these six strategy map examples for inspiration. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in longterm capabilities and customer relationships were not critical for. The balanced scorecard retains traditional financial measures. In a previous paper kaplan and norton 2001b, we described the role for strategy maps and balanced scorecards to develop performance. Kaplan and norton argue that the most critical aspect of strategy implementing it in a way that ensures sustained value creationdepends on managing four key internal processes. Convert ing intangible assets into tangible outcomes. It is this balance that has proven to be so successful in the methodology over the past decade or so. Strategy maps converting intangible assets into trangible outcomes by robert s. The objectives on the strategy map are arrayed across two or more horizontal bands, and each band is known as a perspective.
This article explains the balanced scorecard, developed by robert kaplan and david norton, in a practical way. Strategic management what youll learn in this summary which organizational processes are most critical for enhancing productivity. Organization, which, in turn, results from strategy maps and balanced scorecards. Norton harvard business school press the third volume of the balanced scorecard methodology. Pdf strategy map, operational atlas and balanced scorecard. Commentary transforming the balanced scorecard from. It provides clear line of sight to employees about the overall objectives in the organization and connected their jobs in a visible way to the companys desired goals. Balanced scorecard basics balanced scorecard institute. Pdf having trouble with your strategy then map it kate. The strategy map idea featured in several books and articles during the late 1990s by robert s.
Converting intangible assets into tangible outcomes. Strategy maps, pioneered by balanced scorecard founders robert kaplan and david norton, allow organisations to describe and communicate their strategies concisely and succinctly and close the gap between formulation and successful implementation of strategy. Then, in the strategy focused organization, kaplan and norton showed how organizations achieved breakthrough performance with. Strategy maps book strategy maps converting intangible assets into tangible outcomes robert s.
We will use the many articles and books written by kaplan and norton on the bsc as frame of reference. Kaplan and norton claim that this generic map reflects a generalization of their work with a large number of companies for whom they have developed specific strategy maps. Norton is founder and president of the balanced scorecard collaborative in lincoln, massachusetts. Introduction to strategy maps a book by robert s kaplan and david p norton 1. Strategy map financial perspective customer perspective internal perspective learning and growth perspective human capital information capital organization capital operations management processes customer management processes innovation processes regulatory and social processessupply production distribution risk management. Your strategy map is overly academic or needlessly technicaland frankly, not something youre proud of. Browse the definition and meaning of more terms similar to strategy map kaplan norton.
Using survey data from managers of 91 italian organisations the paper seeks to verify whether. The connecting arrows in the map shows cause and effect relationship of the goals. During the past 30 years, much attention has been focused on how companies can formulate new strategies for sustainable advantage. Your actual strategy is solid, but you have no idea how to depict it in an appropriate, visualfriendly way. The purpose of this paper is to examine the balanced scorecard bsc adoption experience amongst organisations in connection with the strategy map design. If any of these situations sounds familiar, your strategy map software could be a major part of the problem. This article also contains a downloadable and editable balanced scorecard template what is a balanced scorecard. Norton to execute your strategy, you must communicate it throughout your. Before kaplan and norton, most academic strategy courses were dominated by the thinking of michael porter, who began by emphasizing the five forces model that suggested what external, environmental factors would change an organizations. A new management team at vw do brazil develops and deploys a strategy map. Norton s everal years ago, we introduced the concept of a balanced scorecard for motivating and measuring business unit performance. He is cofounder and president of the palladium group. Kaplan and norton s strategy map is a tool to illustrate how organisations intend to convert intangible initiatives and resources into tangible outcomes to achieve organisational purpose.
A complete strategy map template including examples we love strategy maps for their flexibility with various industries and strategies. Learning and growth perspective management theories. Yet, bsc implementations that actually use a sophisticated strategy map appear to be rather successful. This is absolutely chock full of example and sample strategy maps. Strategy maps and balanced scorecards constitute the measurement technology for managing in a knowledgebased economy. An example of a generic strategy map can be seen below. The strategy map was developed by kaplan and norton in 2004 based on the bsc, to help firms develop a strategy. It provides tons of ideas on how to assemble the various components of the strategy map, as well as revisits the selection of overall strategy themes. Since this first incarnation kaplan and norton s thinking has moved on, and the perspectives are now organised in a sequence hence the map idea. In this first of two articles on strategy development, adapted from kaplan and norton s. The idea in brief the core idea the idea in practice putting the idea to work 1 article summary 2 using the balanced scorecard as a strategic management system.
Finally the book from norton kaplan that links scorecarding to intangible assets management and. Using the balanced scorecard as a strategic management system by robert s. You can click on the graph to download a bigger one in pdf format. Norton, have created a powerful new tool based on their ongoing research. A n effective business strategy is a complex series of interconnections a set of causeandeffect relationships. Converting intangible assets into tangible outcomes book is not really ordinary book, you have it then the world is in.
Abstract click on the graph to download a big strategy map template in. Converting intangible assets into tangible outcomes kindle edition by kaplan, robert s. The balanced scorecard tool and strategy map offer a framework to measure intangible assets and to describe strategies as a series of cause. The strategy map and balanced scorecard public service. Linking the balanced scorecard to strategy robert s. By translating their strategy into the logical architecture of a strategy map and balanced scorecard, organizations create a common understandable point of reference for all their units and employees. Introduction to strategy maps a book by robert s kaplan. Developing a strategy map the process below illustrates the four stages in which a contemporary strategy map plus the scorecard and implementation plan are developed.
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