Framework library · Strategic planning
Strategy map
A strategy map arranges a strategy's objectives in four layers: learning and growth at the bottom, then internal processes, then customers, and financial results at the top. It links them so that each objective explains one above it. Writing each link as "A leads to B" exposes the assumptions the strategy depends on, and gives a balanced scorecard its logic.
Use it when
- A strategy exists as a list of initiatives and nobody can say how they add up to the financial goal.
- You are building a balanced scorecard and want objectives that connect, not a set chosen separately for each perspective.
- Leaders disagree about why the plan will work, and mapping the links shows exactly where they differ.
- You need to explain a strategy to managers on one page.
Avoid it when
- The strategy itself is undecided. A map shows how chosen objectives connect; it will not choose between options. Use scenario planning or a weighted decision matrix first.
- You need measures and targets. The map stops at objectives. Carry them into a balanced scorecard.
- The work is a single project with a fixed scope. A project plan or roadmap fits better.
How to run it
Write the financial objectives at the top
One or two outcomes the strategy is for, such as "grow revenue per home passed" or "cut cost to serve".
Write what customers must experience
The customer outcomes that would produce the financial result, written from the customer's side: "faults fixed on the first visit".
Write the processes that deliver it
The few internal processes you must do well for customers to notice the difference. Name what the process must achieve, not the department.
Write the learning and growth objectives
The skills, systems, data and culture those processes need.
Link the objectives as A leads to B
One link per line in the cause and effect box. An objective with no link up or down is either missing a step or does not belong on the map.
Test the weakest link
Ask which link the room is least sure of. That is the assumption to measure first, before money follows it.
Work through it
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Mistakes to avoid
- Drawing four lists with no links, which is a scorecard with the logic left out.
- Too many objectives. Fifteen to twenty across the whole map is usually the most a team can manage.
- Writing processes as departments ("network operations") rather than what they must achieve.
- Treating the links as facts. Each is a hypothesis, and the scorecard should measure whether it holds.
Where it comes from
Robert S. Kaplan and David P. Norton, "Having Trouble with Your Strategy? Then Map It", Harvard Business Review, September to October 2000, which developed the cause-and-effect logic of their balanced scorecard into a map. They set it out in full in Strategy Maps: Converting Intangible Assets into Tangible Outcomes (Harvard Business School Press, 2004). Source.
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Further reading
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