Prof Bob Kaplan says, Strategy maps and themes aid communication of your strategy
Last night I attended Bob Kaplan’s presentation in London on his latest thinking around scorecard development. His talk was entitled “Communicating strategy and managing the strategy execution process with strategic themes”.
In the first part of his talk he explained how companies are using the strategy map approach together with getting the message out through a variety of rich channels, to get people to think strategically and act locally. He is still using the statistic that only 5% understand the strategy, that I came from the survey conducted back in 1997, when I worked with him.
He was explaining how good management teams are doing at least five things when communicating the strategy:
a) Getting the strategy onto a single page with a strategy map so it is easy to understand and explain
b) Getting the message out using multiple rich channels. As he (and many others) say, communicate it “seven time in seven ways”
c) Ensure you help people relate the strategy to their jobs.
d) Reinforce the message with your actions to ensure people realise that their role is to contribute to the strategy.
e) Having clear strategic themes and programmes of change.
I am going to pick up two elements from this today and return to the others in a later posting. These two are the strategy map and the strategic themes, as they are closely related.
The strategy map is a really powerful tool in the Balanced Scorecard approach and one which many seem to miss out on. In the room, many organisations had “Balanced Scorecards” but when asked how many used strategy mapping, barely a third raised their hands. Yet strategy mapping has been around since 1997 or so. I have completed around 50 of them in a whole variety of organisations and their power is characterised by a conversation I had with an IT Director last month.
I was showing him a draft strategy map that one of his IT Account managers had developed in our workshop. It was only a first cut and had taken about a couple of hours to put together. I was using it to illustrate the output and the process we had been following. However he immediately jumped in and started talking about the strategy of this business unit, how whilst some parts were reflected in the strategy map, others were missing and that we needed an extra objective or two to represent that. It was a classic illustration of how strategy maps get the strategy across very quickly and explain it in a rich picture. I had barely had the sheet of paper out for 15 seconds before he started.
The IT Director quickly realised how powerful a technique this was for creating conversations with his fellow directors about the strategy; conversations that he had previously described as difficult to hold easily.
The strategic themes point links closely to the strategy map. If you can tease out the major themes of the strategy you start to orientate the organisation around the delivery of these programmes of change instead of thinking in functional departments, products or silos.
Examples of strategic themes might be cost reduction and revenue growth, or refining existing products whilst developing new ones. Another set of themes might be safety, operational excellence and planning for tomorrow. These themes transcend the perspectives of the strategy map. Each theme should contain elements of each perspective: the financial implications, the implications for customers, the processes and the learning and growth components.
Many people identify themes and start substituting these for perspectives so you end up with a innovation or quality perspective. This misses the cause and effect part of what capabilities do we need to develop to improve innovation or quality, what objective does this achieve for our processes, how will innovation or quality affect the customers and what are the financial implications in terms of revenue or costs?
Once you have these themes clear, it is far easier to communicate the strategy. It is also easier to manage as you are able to orientate the thinking of the organisation and the management of the strategy, around the strategy rather than the existing organisation.
“>I have come across at least eight different ways to categorise and represent strategic themes, depending upon how you are thinking about them and where the emphasis is on your strategy. Each approach has its pros and cons, depending on the focus of your strategy and what is important for you.
If you would like to know more about the power and value of strategy mapping and strategic themes please contact me.
I’ll return to the important topic of communicating strategy (which is also the subject of a my book, “Communicating Strategy”) in my next posting.