Strategy Map Template: Draw the Arrows, Then Test Them

Twenty-two boxes and every arrow points up

Picture the strategy map on the wall outside a leadership team's meeting room. Four colored bands. Twenty-two boxes. “Grow revenue.” “Delight customers.” “Operational excellence.” “Engaged people.” Arrows run from every box in the bottom band to most of the boxes above it. It took a consultant six weeks. Nobody has looked at it since the offsite.

Ask the team one question about any arrow on it. If engagement goes up next year, by how much should customer retention move, and when? Silence. The arrows were drawn because the template has arrows.

A strategy map is a one-page picture of a strategy as a chain of cause and effect. Robert Kaplan and David Norton, who introduced it on top of their balanced scorecard, describe it as a framework that embeds the scorecard's objectives “into a cause-and-effect chain, connecting desired outcomes with the drivers of those results” ¹. The usual template has four bands: learning and growth at the bottom, then internal processes, then customers, then financial results at the top ¹.

Here is the point of view of this page. The boxes are the easy part, and most of the value is in the arrows. Each arrow is a claim that one thing causes another. A map is finished only when every arrow that matters carries a measure and a date that could prove it wrong. Kaplan and Norton said as much themselves: the path to a strategy's destination “consists of a series of linked hypotheses,” and the map makes those relationships “explicit and testable” ¹. Most maps keep the picture and drop the test.

The boxes are the inventory. The arrows are the strategy.

How the four bands fit together

Read the template from the bottom up. People with the right skills, systems and culture (learning and growth) build the capabilities and efficiencies the strategy needs (internal processes), which deliver a specific value to chosen customers (customer), which produces the financial result (financial) ¹. Build it from the top down: start with the destination, then work out the route ¹. Nonprofits and public bodies often put the people they serve at the top instead of the financials ¹.

Two choices in the template do most of the work. The financial band has two levers, revenue growth and productivity, and a map should say how much it relies on each, because productivity usually pays sooner and growth later ¹. The customer band hangs on the value proposition. Kaplan and Norton's template offers three: operational excellence, customer intimacy or product leadership, excelling at one while holding threshold standards in the other two ¹. In their research, about three-quarters of executive teams lacked consensus on this choice ¹.

For the framework itself, see the strategy map and balanced scorecard pages. This page is about filling one in so it survives contact with next quarter's numbers.

The template

Ten fields. Fill them in order. A field you cannot fill is a finding, not a formatting problem.

Fields 7 and 10 are the ones most templates leave out. They are why this one exists.

How to fill it in

1. Write the destination firstOne objective with a number and a date. If the team cannot agree on it, stop: the map will be a compromise between two strategies.
2. Choose the value proposition out loudPick one and write what it means for the customer in a sentence. Writing “all three” is the most common way to skip the choice.
3. Fill the bands top-downFor each customer objective, ask which processes deliver it. For each process, ask which skills and systems it needs. Stop when an objective has no box below it feeding it; that gap is real work, not a drawing error.
4. Write every arrow as a sentence“If first-visit fix rate rises from 70% to 85%, contract renewals rise by 5 points within four quarters, because a failed first visit is the main reason accounts leave.” A sentence like this can be checked. A line between two boxes cannot.
5. Put a lag on each arrowCost savings tend to show first, revenue from deeper customer relationships later, and returns on innovation last ¹. If the map does not say when each arrow should pay, every review will declare it too early to tell.
6. Attach measures, then initiativesOne measure per box, a leading and a lagging measure on each critical arrow, then each funded initiative tied to one box. The KPI examples page shows how to pair a measure with the counter-measure that keeps it honest.
7. Name the weakest arrowAgree on the link the team trusts least and the result, by a date, that would break it. Put that date in the review calendar.

A filled-in example

The company below is invented. Watch fields 7 and 10: they turn a familiar picture into something the next quarterly review can grade.

Notice what Arrow C does to the room. Without it, the review program would be a box called “customer intimacy” that nobody could fail. With it, the team has said in advance what result would prove the program wrong. A comparison group is built in. The bet is now a decision someone will have to make in late 2027, on a date already in the calendar.

What a map shows that a scorecard hides

Kaplan and Norton's own best argument for the map was that it exposes gaps. When Mobil's North American marketing and refining division had units build their own maps, senior management noticed that one unit had no objectives or measures for its dealers, the independent station owners who were a critical part of the strategy, and another had no measure for quality ¹. Their dry question for the second unit: “Had the unit achieved perfection?” ¹.

They also used the map to diagnose two scorecards that look balanced and are not. A stakeholder scorecard lists objectives for shareholders, customers and employees but never says how the company will satisfy them ¹. A KPI scorecard is a collection of measures. One financial services firm tracked four Ps (profits, loan portfolio volume, the share of processes certified to a quality standard, and the diversity of new hires) and had no customer measures and no role for information technology ¹. Their verdict on that kind of scorecard is blunt: “Unless the link to strategy has been clearly thought through, a KPI scorecard can be a dangerous illusion” ¹.

The test is simple. Cover the measures and read only the objectives and arrows. If someone outside the team cannot tell what the strategy is, you have a scorecard, not a map. If you already run a KPI dashboard, the map is what tells you which tiles belong on it.

Do the arrows hold? The case against the map

The strongest objection to strategy maps is that they make guesses look like engineering. A box labeled “employee engagement” with an arrow to “customer loyalty” looks proven because it is drawn. Often nobody has checked.

The evidence supports the worry. Christopher Ittner and David Larcker's field research found that companies measuring customer loyalty, employee satisfaction and other nonfinancial drivers often failed to relate those measures to their strategic goals or to show a connection to financial results, and as a result misdirected investments and rewarded ineffective managers ². Their fix is the discipline this page argues for: propose a causal model, inventory the data you already hold, validate the assumed relationships with established statistical methods, and keep testing as conditions change ².

So the objection is right about most maps and wrong about the method. Kaplan and Norton built the map as a set of hypotheses to be tested ¹. The failure is in practice: teams draw the arrows once and then only report the boxes. Three habits close the gap.

• Use the variation you already have. Branches, regions, plants and account teams move at different speeds. If the units where the leading measure improved did not see the lagging measure follow, after the lag you wrote down, the arrow is in trouble. This is cheap and needs no new data.
• Test one arrow per review. A monthly or quarterly strategy review that takes one arrow in depth, rather than skimming all the boxes, will test the whole map within a year.
• Let a broken arrow change the map. If an arrow fails its test, redraw the band above it and move the money. A map that has never been redrawn has never been tested.

Statistics will not settle every arrow. Some links are too slow or too rare to measure well; a new product line may pay off once, in year three. For those, write a learning milestone instead (“by the second quarter we will know whether plants will share machine data with us”) and say plainly that the arrow is a judgment, not a finding.

Running maps across a company

At Mobil, the division's map gave each business unit and service department the frame to build its own more detailed map ¹. That is the useful kind of cascade: units translate the shared arrows into their own processes and skills, and the senior team reads the unit maps side by side to find what is missing. It is close to the negotiation that hoshin kanri calls catchball.

Three problems appear at scale.

• The copied map. Units take the corporate map and change the logo. Look for unit maps whose process band is identical to headquarters'. A unit that has nothing of its own to excel at either has no strategic role or has not done the work.
• The arrow nobody owns. Arrows usually cross functions: technicians drive renewals that sales is measured on. Name an owner for each critical arrow, not only for each box, or the link falls between two scorecards.
• The map that outlives its strategy. Maps are expensive to draw, so they stay on the wall after the strategy has moved. Date every map and retire it when the destination or value proposition changes.

For the book-length treatment, with many case studies, see Kaplan and Norton's Strategy Maps ³.

Monday: test one arrow

Take your current strategy map, or the strategy deck if there is no map. Find the arrow the strategy depends on most. Write it as a sentence with a size, a lag and a because. Then look for the units where its leading measure already moved, and check whether the result followed.

If it did, you have evidence most strategy teams never collect. If it did not, you have found the most important conversation for your next review. Either way, the map stops being a poster. A strategy map earns its wall space only when someone could look at it next year and say which arrow was wrong.

Questions

What is a strategy map?

A strategy map is a one-page picture of a strategy as a chain of cause and effect, introduced by Robert Kaplan and David Norton on top of the balanced scorecard. It usually has four bands: learning and growth, internal processes, customers and financial results. Its value is in the arrows between objectives, which state how improvements lower down are expected to produce results at the top.

What should a strategy map template include?

A destination with a number and date; financial objectives split between growth and productivity; a chosen value proposition; customer, process and learning objectives; the three to six cause-and-effect links the strategy depends on, each with a size and a lag; a measure for each objective; the initiatives tied to each; and the weakest link with the result that would disprove it.

What is the difference between a strategy map and a balanced scorecard?

The balanced scorecard lists objectives, measures and targets across four perspectives. The strategy map shows how those objectives are supposed to cause one another. Kaplan and Norton warned that a scorecard built without that causal logic can become a collection of measures that does not describe a strategy, which is what the map is meant to expose.

How do you test whether a strategy map's arrows hold?

Write each arrow as a sentence with a size, a lag and a reason, then compare units where the leading measure improved against units where it did not, after the stated lag. Ittner and Larcker recommend proposing a causal model, using data you already hold and validating the relationships statistically. Where an arrow cannot be measured, label it a judgment and set a learning milestone.

Where to go next

• KPI Examples That Track Strategy, Not Activity
• Hoshin Kanri and the X-Matrix
• Balanced Scorecard: Framework & How to Apply It
• Leading vs. Lagging Indicators
• Value Discipline