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Performance Management And Value Essay

Strategy Mapping Performance Management and Establishing Value Propositions

Successful performance management can create a competitive advantage in virtually any industry. Furthermore, the failure to manage performance can also make an organization vulnerable to external threats. As a result of the importance of implanting strategies and managing performance, many organizations have begun to understand the importance of using a wider array of metrics than just the traditional financial metrics to create value. Models such as the balanced scorecard provide a comprehensive platform that can be customized to help an organization manage performance and create value in the market for both customers and investors. Still, even with a good strategy in hand, an organization must also have an execution strategy that can help them implement the strategy before it is of value and can create a competitive advantage. This analysis will look at the ability for strategy mapping to serve as a supplement to the balanced scorecard to ensure that the organization executes the strategy successfully

The Need for Execution

Today's management teams have a plethora of different options and tools to help them create an effective strategy. Beyond the balanced scorecard, strategic planning may include (but are not limited to) Porter's 5-Forces, STEEP (Social, Technological, Economic, Environmental and Political) analysis, SWOT (Strength, Weakness, Opportunity, Threat) analysis, PMI (Plus, Minus, Interesting), Red and Blue Ocean strategies, among many, many others (Armitage & Scholey, 2006). Most competent managers can devise a relatively well-crafted strategy that is ground in the organization's particular set of circumstances. However, no matter how good the strategy is, it will not do much good unless...

Other estimates have put the figure closer to ninety percent however also noted that whether the actual figure is sixty or ninety, that it really would not matter and this issue should be on the forefront of every manager's consideration (Keyte, 2012 ). There is often a huge effort to determine what the best strategy should be in an organization. However, strategic execution is often an afterthought, if thought of at all. This is despite the fact that the execution is often the critical success factor that can determine the success of the strategy to begin with.
Strategy Mapping

There are many essential benefits that a strategy map can offer an organization and be a complimentary exercise relative to the balanced scorecard. Management can use these maps to better develop their strategies and build these strategies in a more dynamic context. One of the primary advantages of developing a strategy map is that is allows a complex strategy to be communicated through a relatively simple, rich, and succinct map, as opposed to trying to deliver a "strategy by hope and magic" (Jones, 2011). Not only does it allow individual employees to better understand their role in fulfilling their strategic expectations, but they can also better visual how their roles connect to the larger objectives.

Not only can a strategy map be a useful tool to communicate strategy, but it can also help management to fine tune their performance management initiatives. For example, when building a strategy map, the management team must drill down the strategy to a more detailed version of the broader strategy. Furthermore, it also helps a…

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References

Armitage, H., & Scholey, C. (2006). Using Strategy Maps to Drive Performance. Retrieved from CIMA Global: http://www.cimaglobal.com/Documents/ImportedDocuments/Tech_MAG_Strategy_Mapping_March07.pdf

Jones, P. (2011). Introducing Strategy Maps and Strategy Mapping. Retrieved from Excitant: http://www.excitant.co.uk/resources/white-papers/strategy-maps-and-strategy-mapping

Keyte, C. (2012, October 30). 90% of Business Strategies Fail Due to Poor Execution. Retrieved from B2C: http://www.business2community.com/strategy/90-of-business-strategies-fail-due-to-poor-execution-0319429#XOoz4suKltT25xhE.97
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