Balanced Scorecard

Strategy Map

Definition

A strategy map is the one-page diagram behind a Balanced Scorecard: it arranges an organization's objectives across the four perspectives and connects them with arrows showing which objective is expected to drive which. Kaplan and Norton added it to the framework in the late 1990s because teams could list measures easily but could not explain how those measures were supposed to be related.

Objectives are stacked with Learning & Growth at the bottom and Financial at the top, and every objective connects upward to at least one other. Most maps hold 12 to 20 objectives, few enough to be read on one page during a meeting. The arrows carry the argument: each is a hypothesis of the form "if we improve this, that should follow." Measures hang off the objectives, so the map itself stays free of numbers and the logic stays legible.

A strategy map is a set of hypotheses drawn as if they were facts. The arrows are chosen by a leadership team from experience rather than from data, and they are almost never revisited once the map is printed, so a link that turned out not to hold keeps directing investment. Maps also age: the diagram describes the strategy as it stood on the day of the offsite, and the further the year runs, the less it resembles what teams are actually working on.

Example

A SaaS company draws: "Deepen product expertise in support" (Learning & Growth) leads to "Resolve tickets at first contact" (Internal Process), then "Customers renew without escalation" (Customer), then "Lift net revenue retention from 104% to 118%" (Financial).

See also: Balanced Scorecard software

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