HBS Working Knowledge has an interview with Robert Kaplan and David Norton who have authored a book “Strategy Maps: Converting Intangible Assets into Tangible Outcomes.” Excerpts from the interview:
A strategy map provides a visual representation of the organization’s strategy. This is truly an example of how one picture is more powerful than 1,000 words (or even twenty-five ad hoc performance measures). The financial and customer objectives describe the outcomes the organization wants to achieve; objectives in the internal and learning and growth perspectives describe how the organization intends to achieve these outcomes. The discipline of creating the strategy map of linked objectives in the four perspectives engages the executive team, and often promotes much greater clarity and commitment to the strategy.
Once created, the strategy map is a powerful communication tool that enables all employees to understand the strategy, and translate it into actions they can take to help the organization succeed.
Most organizations identify a single person to be the steward or organizer of the strategy map. This person ensures that data are continually fed into the map and Balanced Scorecard to keep them refreshed, organizes the monthly report distributionusually electronicallyand sets the agenda for the monthly management meeting to discuss performance against the strategy.
[Michael] Porter argues that strategy is determined by a unique combination of activities that deliver a different value proposition than competitors or the same value proposition better. The strategy map framework allows companies to identify and link together the critical internal processes and human, information, and organization capital that deliver the value proposition differently or better. Thus, the process of creating a strategy map and Balanced Scorecard translates the formulated strategy into specific objectives, measures, targets, and initiatives in the four inter-related perspectives.