Strategy Map

Full Definition

A Strategy Map, developed as a companion tool to the Balanced Scorecard by Kaplan and Norton, is a one-page visual representation of the company's strategy showing how strategic objectives in each of the four BSC perspectives causally connect to drive financial outcomes. The map reads bottom-up: Learning and Growth objectives (develop employee capabilities, enhance information systems) enable Internal Process objectives (improve quality, reduce cycle time, accelerate innovation), which create Customer outcomes (improve satisfaction, increase retention, expand market share), which produce Financial results (revenue growth, margin expansion, asset utilization improvement). The visual format makes strategic logic immediately communicable to all stakeholders. The Strategy Map's primary value is in making strategy explicit and communicable. Most organizations have strategy documents that are dense text read only by senior leaders, strategic plans that are translated inconsistently by different departments, and executives who describe the company's strategy in different terms depending on who is asking. A one-page Strategy Map that all senior leaders have co-created and committed to eliminates these alignment failures—every executive can point to the same visual representation of how their functional objectives connect to company strategy. Board presentations anchored to the Strategy Map ensure strategic discussions focus on the right connections rather than isolated metrics. Building a Strategy Map forces an important discipline: testing whether the causal hypotheses embedded in the strategy are genuinely valid. If the map shows that "improve employee technical skills" causes "reduce system downtime," management must track whether that causal relationship actually materializes—providing evidence-based strategy validation rather than faith-based assumptions. Organizations that treat the Strategy Map as a living document, validating and refining causal hypotheses as data accumulates, develop genuine strategic learning capabilities that make them more adaptive than organizations treating strategy as immutable planning documents.

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