Strategy Maps and Strategy Mapping 3
Mistakes to avoid when designing strategy maps
On these pages we explain what strategy maps are,
describe some of the benefits of strategy maps and provide a couple
of examples. We also describe some common mistakes to make and how
to avoid them.
Mistakes to avoid
1) Losing the cause and effect story
The most important aspect of the strategy map is
that it contains a simple, but powerful cause and effect model.
For commercial organisations this model says,
Purpose: We have an overall purpose
or ambition.
Our financial objectives: To
deliver that purpose, we have a financial model that explains
how sales and costs will change to deliver that overall ambition.
What our customers want: Of course
you will only achieve these financial results if you satisfy
your customers. So you have to be clear what they want.
What do we have to do well? What
do we have to focus on to satisfy our customer's needs? What
do we have to do really well. If we do these well, (and economically)
then we shall keep our customers happy and deliver our financial
results.
What do we have to learn and develop?
To do these well, we have to concentrate on the skills,
knowledge and capabilities in the organisation that have the
biggest effect on delivering this. This is the learning and
growth perspective.
If you lose the cause and effect model, you lose
the drivers of change in the strategy.
One of the things we bring is the ability to tease
out these relationships and helping you to develop them so they
tell a story as well.
(For public sector organisations the model is a
little different, but still important.)
2) Changing the perspectives for strategic themes.
Quite often people say our strategy is about innovation,
or quality, or customer service, or something else, and introduce
additional perspectives into the cause and effect model.
The problem is these are not perspectives. They
are strategic themes. Introducing them causes you to destroy the
cause and effect model and just end up with a collection of innovation
measures with no clear driver of them.
Any strategic theme, like innovation, should have
within it the cause and effect model. If it does not, you have
to ask, what is this aspect of the strategy contributing to the
organisation? So, you should be able to work through the perspectives
telling the story, of the skills and capabilities you need, that
are applied in the processes, so they deliver benefits for the
customers that will lead to financial results. If you can't do
this you probably have not thought it through.
Feel free to destroy the cause and effect model
and substitute strategic themes if you like, but your strategy
map will not tell the story of the strategy, you won't be able
to cascade it easily, you will drive into measures too soon and
you will lose all the benefits that the strategy map provides.
It is usually a sign of a poorly thought through strategy.
3) Using measures rather than objectives
If you start designing a strategy map by putting
measures on it, you might as well just stick with a scorecard.
One purpose of the strategy map is to step back
from the measurement and ask, what do we want to achieve. Thus
the strategy map should include "objectives" rather
than measures of those objectives.
Once you are clear what you want to achieve, they
you can ask, "What is the best way to measure this?"
If you do it the other way around you end up managing what you
can measure. This way around you measure what you want to manage
and achieve.
Put measures on the strategy map if you like, but
you will soon end up in the measures trap, managing what you can
measure (or what you think you can measure).
4) Putting what you do in the customer perspective
This is a favourite amongst first time strategy
map designers. It is also a sign of an organisation that is too
internally focused and not thinking from the customer's perspective.
What they do is state things that they deliver for
the customer, such as successful projects, products on-time, or
a phone that only rings 3 times.
They are not thinking from the customer's perspective.
What they are doing is sticking objectives that should be in the
process (what do we have to do well) perspective into the customer
one.
The effect is this is two fold: They project that
what we have to do well is what the customer wants. Often it is
not.
They effectively lose a perspective so they end
up putting things that should be in the learning and growth perspective
into the process one. By the time they get to the learning and
growth perspective, they have run out of things to include. Glib
phrases for objectives
5) Just customers
For some reason, people think that only customers
go in the customer perspective. Well if you want to make that
assumption, then fine.
However make sure that other external layers are
there for a good reason because they are in some way related to
your strategy and satisfying them is a part of your strategy.
Others try to include every single so called "stake-holder"
in the customer perspective. You can try this, but very soon it
will become confused and over crowded. You are clearly missing
out on the key question, about who are the most important people
to satisfy, and why?
6) Start at the bottom
This is a favourite amongst support functions trying
to justify their existence. They start at the bottom of the strategy
map with a capability and then spend all their thinking time asking
the question, where can we contribute.
Very soon they have justified their existence everywhere
(and so has everyone else) so you end up with everything supporting
everything else.
What you are drawing is not a strategy map. It is
a set of functional links and contributions. The strategy is about
what are the few key things we have to concentrate on.
Try doing it this way if you like, but you will
end up with a rat's nest of linkages that makes a plate of spaghetti
look tidy. And you won't be able to tell the story of the strategy
either.
7) Include everything
Try including everything you do if you like. After
a short while you will have a strategy map with about 50-60 objectives
on it that is starting to become unmanageable. And you won't have
finished.
Strategy is about focus. Strategy is about what
you choose to do and choose not to do. Just because a function
is not on the top level strategy map does not mean it is not important.
It probably is important and still needs to be done well. But
it may not be strategic. It may not be a critical lever of change
at the highest level.
If you try to include everything you will end up
trying to satisfy everyone's ego to be at the top. Frankly you
will fail.
You will also have failed to think how the strategy
maps cascade through the organisation.
8) Failing to ask, what is most important
I have said it before and I will say it again. If
you fail to ask, "What is most important?", you will
miss out on what the strategy actually is.
If you fail to get an answer, that is a different
issue, and one where you need the help of a good strategy map
facilitator.
9) Make them look untidy
I have seen some really untidy, unstructured and
messy strategy maps.
I have a simple rule: The strategy map is a refection
of the quality of thinking of the management team. (At best it
is a reflection of the quality of thinking of the consultant or
manager who tried to draw it up).
If it is a mess, then so too is the thinking in
the management team.
A good strategy map facilitator will help you to
develop an elegant and clean story and an elegant and clean strategy
map.
If you can't easily read the strategy from the strategy
map, then it is pointless. It is not a strategy map. As one client
put it, "I have my strategy on a single page, and so does
everyone else" It makes it so easy to have a discussion about
the strategy now."
10) Doing it alone
One of the worst mistakes is disappearing into a
room and designing your strategy map alone. All you will end up
with is your version. It is not just your strategy so
why would you develop your strategy map alone.
We find that the act of developing a strategy map
together, from the collective heads of the management teams, not
only ends up with a strategy map that they own, but on the way
improves the quality of thinking and understanding of the strategy
amongst that team.
11) Using examples from the books
I saw this really badly recently when I visited
a client who had used a consultant, who simply copied a strategy
map from one of the Norton and Kaplan books.
The client was frustrated because he did not know
how to take what the consultant had given him and relate it to
their business plan.
The reason: a) the consultant thought he could simply
modify a strategy map from the book. b) it was not the organisation's
strategy that he was representing: it was someone else's.
Some of the examples in the books are great. Most
have been sanitized to protect the organisation's strategy (would
you want your strategy published - warts and all?). Most of the
examples in the books describe the finished strategy maps, not
how they were developed, cascaded and how they are used.
12) Not understanding the implications of various
strategy map designs
There are at least nine or ten main ways to structure
the design of a strategy map. Each one will have different implications
for the way the team think, the way the strategy gets described
and it is rolled out.
A strategy map anchored on the customer's perspective
will create a quite different design to that anchored on the process
perspective. The implications will be far reaching for the strategy
and its implications.
If you do not appreciate these design differences
you can scupper the strategy map at an early stage. Get it right
and it could make all the difference (and all your work will be
worthwhile).
13) Missing the strategic assumptions
The strategy map is a very powerful description
of a strategy and a great way to tell the story of the strategy.
But, it is not the whole story.
Embedded within the strategic thinking will be assumptions,
policies and uncertainties. These need clearly identifying and
documenting so that, as the strategy plays out, the management
team can keep an eye on them.
The strategy map on its own does not capture these,
so you need other pieces around the edges to make sure that they
are not missed.
They will be vital when you come to train and develop
your management team to use their strategy maps as their primary
review mechanism in operational and strategic reviews.
14) Not using an experienced consultant and facilitator
The acid tests of a strategy map in an organisation
are "is it useful?" and "Is it persistent".
Does it help the management team manage their strategy and are
they able to continue to relate to it and use it and refine it
as their strategy develops?
I have visited clients FIVE years after the initial
work to find their strategy maps still in use. I have clients
who tell me they are still using the approach and strategy we
introduced four to five years later, because it works.
Much of the work involved in the design of a strategy
map with a team, is not about the strategy map. It is about helping
that team get a thorough, deep and common understanding of the
strategy, their strategy. Their strategy that gets represented
on their strategy maps.
I have been developing strategy maps since 1996
when I joined Norton and Kaplan's organisation. At the time they
were often called performance driver models as they were at an
early stage of development, and we were still learning how best
to use them and design them.
Since then I have developed over 50 strategy maps
in a whole variety of organisations. To tap into this experience, contact us. These have included:
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Large commercial organisations including from retail, insurance,
banking, manufacturing, utilities, construction, developers,
travel and many more. These have usually involved a cascade
of the strategy maps and scorecards.
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Start-ups and dot.coms where the strategy is often changing
and evolving rapidly
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Public sector organisations such as various parts of the
NHS, Local government, DWP, MOD and others. A key issue here
is integrating statutory requirements with local strategy
so that management can see the wood from the trees.
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Strategy maps for support functions such as IT strategy maps,
finance strategy maps, HR strategy maps, as well as many other
support functions. Quite often the issue is how can we demonstrate
our contribution and strategy will make a difference to the
organisation.
When you get these right
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You all understand what each other does and has
to do
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You have an excellent strategy communication tool
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You have focus on what matters, and can drill down into the
detail if you need it
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You are measuring what matters, not managing what you can measure.
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You have an tool that helps you manage strategically and operationally
as you need
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You have more confidence in the strategy and its execution
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You can more easily refine your strategy without revising the
whole thick planning document.
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You are more likely to deliver your strategy.
Obviously your requirements will depend upon where you are and
the particular problems and challenges you are facing.
Go to Strategy maps:
The benefits of strategy maps
Go to to Strategy
maps: Examples and case studies
When you are ready to explore your particular needs
just, contact us.
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