Kaplan & Norton – “Strategy Maps”, a Book Review & Analysis

Few thinkers were ever more influent than those two Harvard professors – Robert Kaplan and David Norton. They are among the top 50 thinkers since more than a decade and their two important books (“The Balanced Scorecard” and “Stratey Maps”) are an important portion of any consultant’s or CEO’s arsenal. Especially when they are trying to deploy powerful organisational changes, aimed at delivering value. But what is this book about?
Before we start, we have to take a look into the history. Kaplan and Norton wrote in 1996 an influential book called “The Balanced Scorecard”. The main idea of this scorecard was that a business can be analysed and changed taking into account SIMULTANEOUSLY 4 business perspectives:
The internal perspective (mostly managers doing it)
The Customer perspective (what do the existing and prospective customers value at your organisation)
The financial perspective (what are their objectives)
The learning and growth perpsecive (how can we improve and add value)

The balanced scorecard tool has become one of the widest used management tools, especially in the US corporations. However, Kaplan and Norton felt that the senior management of the organisations, namely the board of directors, needed a more comprehensive and strategic tool in order to steer the direction of their businesses.

And this is how “Strategy Maps” were born. These strategic maps are not a simple improvement of the balanced scorecards. They are actually a very complex and powerful set of tools, used to mindmap and evaluate the road of any organisation through the future. A strategic map is a planning tool for the future, not merely an evaluation tool (as its peer was).

The idea behind the “Strategy Maps” book is very simple. Any company has a defined set of value-adding processes – those processes which are valued by the customers and for which the clients are willing to pay:
Operations management processes – those processes creating and delivering the product or the service
Customer management processes – those areas of the businesses interfacing with the customer and increasing their satisfaction levels
Innovation processes – those which are changing the way the company does business and
Regulatory and social processes

I will not go into the details of describing how these processes add value. What is important to know is that all these dimensions are split into key performance indicators (KPI’s) and can create literally a roadmap to success for any organisation. From this perspective, the “Strategy Maps” book is a conceptually hard to grasp one. Yet, it can be a very rewarding lecture. Even if you do not agree with its conclusions, it is still one of the best business books ever written. So have a look and let us have your feedback…

As you can see, I tried to do this review impartially (not as a commercial). Should you like to read the book, please try this Amazon link – you will pay the same price whilst a small referral fee will help sustain this investment blog. Thank you for your choice!:

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