Process of Strategy Mapping

Strategy Mapping

The author of this report has been asked to write a brief report relating to strategy mapping and hot it relates to performance management and the establishment of value propositions. The above touches on three important dimensions of any business and they should all be planned for accounted for in the best and most effective ways possible. The report below will explain this in more detail or all three dimensions.

Strategy mapping, in a nutshell, is the planning of a strategy from what it can do in theory and then extended to how profitable it can be in the future. Just because the strategy mapping process is started does not mean the project can or should go forward and it does not mean that the project would ever be profitable. All it means is that the path to potential path to profitability is being mapped out. It may work out and it may not. On top of that, a better course of action may be seen that is better than the other options. Strategy mapping is something that is commonly, although not always, part of the balanced scorecard process although this is not necessarily the case in all instances. The strategy map very much resembles a flow chart in that it shows interconnected circles and rectangles with "flow" lines in between (Excitant, 2013).

Generally speaking, each objective in the path to profitability will be represented by a shape. The amount of objectives is usually a dozen or two…if that. Any more than that is a muddling and over-complication of the process. If there are multiple small steps that are somewhat related or intimately related, they can often be condensed together in a single step. This whole process was envisioned and explained by Robert Kaplan and David Norton as part of the broader framework of the balanced scorecard (Excitant, 2013).

As for performance measurement, this dynamic takes on two major forms. First up is the measurement of performance at the company level. This would involve the measurement of metrics company-wide, within a division, within a department or even for just the people under a certain reporting manager. Using these multiple points of analysis can reveal where precisely performance bottlenecks are occurring. Looking only at the highest levels can reveal issues. However, it does not necessarily (and often does not) point to the right department that should be scrutinized for further review (Vorhauser-Smith, 2012).

Going just a little lower down the organizational ladder may or may not reveal things as well. While it will probably tell you the division that is the problem, divisions are often quite large and expansive and the division can have different points in and of itself where problems can exist. This is when getting to the department or reporting manager level can be extremely instructive and identify where the weak points are (Vorhauser-Smith, 2012).

The other main point of analysis as far as performance measurement goes is the employee level. Obviously, it would behoove an employer to map the desirable strategic and business outcomes to the performance of the employee as a misalignment between what the employee is doing and the overall goals of the firm will lead to wasted efforts or, at the very least, less than optimal results as compared to where they could or should be. What employees are told to do and the measurement thereof needs to be clearly linked to the objectives and desired outcomes of the firm and there should be no break between the two unless there is a very good reason. Obviously, this will be rare but there are times where non-value added activities sometimes have to be done to engender good will with the clients and the community (Vorhauser-Smith, 2012).

As far as value propositions go, this is like the performance management dimension in that it is multi-faceted. It is often associated with a business to customer relationship but the definition of a customer takes on several forms and these multiple forms should all be considered. A value proposition to a client is generally the idea of what they expect from a firm they do business with so as to justify why they are spending their money and investing their time. If there is a failure to deliver on what is expected from the firm, the relationship will probably not last (Skok, 2013).

A related but slightly different failure would be if what the firm says they offer or actually can offer is not entirely within phase with what the client in question needs. If the business model or service offerings of the client are not in sync with what the client really needs or prefers, then the value proposition of the client will probably not be met and the relationship will probably not end well. In short, businesses need to make sure they can define what they offer and that they end up marketing and selling their products or services to clients that need precisely those types of services and/or goods. Otherwise, referrals and return business will not be forthcoming and word of mouth could very well be poor (Skok, 2013).

To tie this to a real-world example in the text, British Aerospace had a poor response to changing customers and they did not have a marketing strategy for new markets. In other words, they were unable to adjust and evolve their value proposition to fit the demands of new clients and/or clients whose needs were changing with the times. This will no-doubt explain the associated problems they had of losing market share from other European and American competitors that were absolutely willing and able to fill the voids that were left by BAE not offering what their clients needed (CIMA, 2013).