E-Book Overview
f you were a military general on the march, you'd want your troops to have plenty of maps — detailed information about the mission they were on, the roads they would travel, the campaigns they would undertake, and the weapons at their disposal. The same holds true in business: a workforce needs clear and detailed information to execute a business strategy successfully. Until now, there haven't been many tools that can communicate both an organization's strategy and the processes and systems needed to implement that strategy. But authors Robert Kaplan and David Norton, cocreators of the balanced scorecard, have adapted that seminal tool to create strategy maps. Strategy maps let an organization describe and illustrate — in clear and general language — its objectives, initiatives, targets markets, performance measures, and the links between all the pieces of its strategy. Employees get a visual representation of how their jobs are tied to the company's overall goals, while managers get a clearer understanding of their strategies and a means to detect and correct any flaws in those plans. Using Mobil North American Marketing and Refining Company as an example, Kaplan and Norton walk through the creation of a strategy map and its four distinct regions — financial, customer, internal process, and learning and growth — which correspond to the four perspectives of the balanced scorecard. The authors show step by step how the Mobil division used the map to transform itself from a centrally controlled manufacturer of commodity products to a decentralized, customer-driven organization.
E-Book Content
HBR FROM THE HARVARD BUSINESS REVIEW OnPoint A R T I C L E Your vision is sublime; your strategy, brilliant. So why are your troops lost? Maybe they need a map. Having Trouble with Your Strategy? Then Map It by Robert S. Kaplan and David P. Norton New sections to guide you through the article: • The Idea in Brief • The Idea at Work • Exploring Further. . . PRODUCT NUMBER 5165 T H E I D E A I N B R I E F H ow does Mobil make sure that every gas station owner understands the company’s strategy—and implements it each time a customer drives up to his pumps? How did Mobil become the industry’s profit leader and boost its cash flow by $1 billion+ per year? By using a strategy map—a powerful new tool built on the balanced scorecard. The balanced scorecard measures your company’s performance from four perspectives— financial, customer, internal processes, and T H E I D E A AT Having Trouble with Your Strategy? Then Map It learning and growth. A strategy map is a visual framework for the corporate objectives within those four areas. The authors created strategy map templates for various industries, including retail, telecommunications, and e-commerce. Strategy maps put into focus the often-blurry line of sight between your corporate strategy and what your employees do every day— significantly enhancing collaboration and coordination. W O R K WHY STRATEGY MAPS? Strategy maps are essential in the information age, when intangible assets—customer relationships, employee skills, the ability to innovate— are competitive advantages. But these assets have value only within the context of a strategy. For example, a growth-oriented strategy might require in-depth customer knowledge, sales training, and incentive-based compensation. But none of these, alone, would be enough to implement that strategy. Strategy maps quantify the value of tangible and intangible assets— linking them all to your overarching strategy. Customer. Differentiate your firm from competitors. Choose one of these value propositions: operational excellence, customer intimacy, or product leadership. EXAMPLE: Mobil emp