B.E (Mining) from Osmania University passed out in1981, in First Division with Distinction.

Abstract:

Strategy without Execution (implementation) is like Execution (capital punishment/ the death sentence) for any industry.

Unbalanced Strategy is like Constructing a multi storied building/ monument without proper foundation and alignment.

Whatever Strategy the company adopts it has to be Balanced  Strategy (All important enablers and outcomes/results are addressed) and it has to be Executed across the Organisation (Many company’s fail to get best of their strategies due to failure in execution). The best tool for assessing that the Strategy is Balanced or not is the preparation of Strategy Map establishing the Cause and Effect relation among the outcomes and enablers. The method for Strategy Execution is to “Translate Strategy into Operational terms” and aligning all the “Processes and People” to the Strategy which can be achieved by “Balanced Score Card Concept”.

This paper is addressing the process for preparing Strategy Maps, Translating Strategy Maps into Balanced Score Card of CEO and then aligning Functions/ Departments with Corporate Strategy.

Introduction:

Strategy Maps are Excellent Tool for Balancing the Strategy / Validation of Existing Strategy . Strategy Maps prepared as per Balanced Sore Card Concept helps in validating your strategies by putting them into the frame work. It asks you to balance your strategies in the BSC perspectives and establish the Cause and Effect relation.

Balanced Score Card is the Excellent Tool for Strategy Deployment through Alignment of Processes and People.

Strategy Maps:

Strategy Map is a pictorial presentation of strategy showing logical sequence with cause and effect relation among the strategies. It provides the visual framework for integrating the organization’s strategies in the four perspectives of a Balanced Scorecard. It provides a single-page view of the strategy. A properly constructed strategy map tells the game plan / strategy story of the organization.

In generic Strategy Management approach Strategy is formulated after detailed Environment Scanning (both internal and external environment- Situational Analysis and  SWOT Analysis). In this methodology the strategy formulated is not balanced ie. Focused on Financial Strategies and Technology related Strategies and most of the times the Customer related and Learning & Growth strategies to support Financial and Technology strategies are missing. Mostly the Strategies are imbalanced as below:

• Oil companies Strategies tend to be dominated by the technical and cost focus of the refineries at the expense of marketing
• Consumer goods companies Strategies are dominated by a marketing and sales focus at the expense of technology and innovation
• High tech companies have a strong engineering and technology culture with manufacturing often being a stepchild

Whatever Methodology Company adopts to develop Strategy, but it has to validate it by putting them into BSC perspectives and establish Cause and Effect relation among these Strategies. In this process company has to identify new strategies (The author has conducted more than 25 workshops on BSC in which more than 100 teams formulated strategy by doing SWOT analysis and taking into account the different Stakeholders requirements etc, but every team had to identify few more strategies and drop few strategies to Balance it and Prepare Strategy Map)

A Sample Strategy Map:

Balanced Score Card

The Strategies are mostly stated in the words/statements and the meaning/ intent of the strategy are not translated into operational language. Different Executives/ Employees interpret it in their own way, which may lead to miss alignment. Hence the Strategy has to be translated into operational language as Strategic Measures/ Key Performance Measures.

These SMs/KPMs should become the parameters in CEOs BSC. For each SM/KPM the organisation has to identify the Targets, Comparisons/Benchmark and the process owner.To achieve the targets the organisation has to identify the initiatives.

A Sample Partial Balanced Score Card to show how Strategy Translated into Operational Terms:

Aligning Processes  and People:

For the successful implementation of Strategy, every Function /Department has to align their Strategies/ Processes in line with corporate BSC.

A critical analysis of existing processes/sub-processes, their desired/expected output and Performance Indicators/Measures has to be conducted. Then analyse these measures to asses impact/ linkage to SMs/KPMs in CEOs BSC. By selecting the measures that have high impact on SMs/KPMs of CEOs BSC the Functional/Departmental BSC will be prepared. Again the Functions/Dept.s have to check for the gaps in their BSC and identify new Processes/KPMs in their Function/Dept. and prepare final Functional/ Deptl. BSC.

Once the Departmental BSCs’ are prepared the Individual Score Cards (ISCs) of executives/officers in each department are to be prepared in line with individuals responsibilities/activities.

Review

The daily, monthly and Quarterly review systems are to be integrated with BSCs/ISCs. Organisations can use BSC Softwares deveoped in line with BSC methodology.

A Sample of Partial Functional/ Deptl. BSC.


References:

Translating Strategy into action “The Balanced Scorecard”  and Strategy Maps books by Robert S. Kaplan and David P.Norton.

Authors experiences in TISCO, Tata Projects, NTPC and Gulf Oil Corporation.

About Author:

A.Ajaya Shankar Gupta

MBA (Technology Management) from Osmania University during 2005-2007.

Presently Research Scholar (part time) in SMS,HCU under the guidance of Dr. V Sita