Map Strategy with Balanced Scorecard

1. Map Strategy with Balanced Scorecard Executive SummaryMap Strategy with Balanced ScorecardEffectively developing and communicating high-level business strategy is essentialfor organizations looking to achieve market leadership. Additionally, creating aresults-oriented culture requires a comprehensive management system. Use DemandMetrics downloadable Balanced Scorecard Strategy Map tool as a basis forimplementing a proven business performance management methodology.What is the Balanced Scorecard Approach?Developed in 1992 by Kaplan & Norton, the balanced scorecard provides: a methodfor aligning business strategy with vision & mission; a system for developing keyperformance indicators that drive success; and the ability to measure performanceacross the four key perspectives: • Financial • Customer • Business Process • Learning & GrowthA visual strategy map is created where strategic objectives, measures, targets, andinitiatives are developed for each perspective.Strategy Map Components: • Mission - this is the purpose of the business used to guide internal staff. • Vision - includes long-term goals that are external and market focused. • Financial Perspective - measures that reflect financial performance such as return on assets, liquidity ratios, or return on investment/payback period hurdle rates. • Customer Perspective - measures that have a direct impact on customers such as segment growth, acquisition & retention rates, satisfaction, or competitive rankings. • Business Process Perspective - these metrics are key performance indicators of key business processes related to sustaining supplier relationships, producing products/services, distribution to customers, and other business operations. • Learning & Growth Perspective - measurements associated with the ability to develop human, information, and organization capital. © 2009 Demand Metric Research Corporation

2. Executive SummaryAction Plan: 1. Discuss Strategy Mapping with Senior Management - communicate the value of strategy mapping with the Balanced Scorecard approach. Get commitment for formal business planning & performance measurement. 2. Document Vision & Mission - if not done already, update your corporate vision and mission statements. It is critical that your internal staff understand their purpose and stakeholders have an accurate perception. 3. Build a Balanced Scorecard - use Demand Metrics downloadable Balanced Scorecard Strategy Map tool to build a customized scorecard for your organization to work from. 4. Develop Strategic Objectives - analyze each perspective to identify high- level strategic objectives. Determine which departments or cross-functional teams will be responsible for each objective. 5. Establish Measures & KPIs - for each objective, identify key performance indicators (KPI) and establish metrics to gauge business performance. 6. Create Attainable Targets - set attainable goals for metric improvement across each KPI. For example, improve client retention from 65% to 70%. 7. Conduct Business Planning - work with senior management to plan key initiatives for each perspective. Be sure not to take on too much at once. 8. Adjust Strategy with Results - as results from measured activities come in, adjust your strategic objectives, metrics, targets, and initiatives accordingly. The balanced scorecard was designed to incorporate feedback.Bottom-Line:Using Strategy Maps such as a Balanced Scorecard facilitates business planning &prioritization, setting goals and objectives, establishing KPIs & metrics, and selectinginitiatives that deliver the most value. A holistic approach to strategy andperformance measurement makes it much easier to translate vision into individualtasks and activities. © 2009 Demand Metric Research Corporation Executive SummaryAction Plan: 1. Discuss Strategy Mapping with Senior Management - communicate the value of strategy mapping with the Balanced Scorecard approach. Get commitment for formal business planning & performance measurement. 2. Document Vision & Mission - if not done already, update your corporate vision and mission statements. It is critical that your internal staff understand their purpose and stakeholders have an accurate perception. 3. Build a Balanced Scorecard - use Demand Metrics downloadable Balanced Scorecard Strategy Map tool to build a customized scorecard for your organization to work from. 4. Develop Strategic Objectives - analyze each perspective to identify high- level strategic objectives. Determine which departments or cross-functional teams will be responsible for each objective. 5. Establish Measures & KPIs - for each objective, identify key performance indicators (KPI) and establish metrics to gauge business performance. 6. Create Attainable Targets - set attainable goals for metric improvement across each KPI. For example, improve client retention from 65% to 70%. 7. Conduct Business Planning - work with senior management to plan key initiatives for each perspective. Be sure not to take on too much at once. 8. Adjust Strategy with Results - as results from measured activities come in, adjust your strategic objectives, metrics, targets, and initiatives accordingly. The balanced scorecard was designed to incorporate feedback.Bottom-Line:Using Strategy Maps such as a Balanced Scorecard facilitates business planning &prioritization, setting goals and objectives, establishing KPIs & metrics, and selectinginitiatives that deliver the most value. A holistic approach to strategy andperformance measurement makes it much easier to translate vision into individualtasks and activities. © 2009 Demand Metric Research Corporation