USING STRATEGY MAPS TO

PRIORITIZE LEARNING AND

PERFORMANCE IMPROVEMENT
AGENDAS
Cassandra A. Frangos

There are best practices that organizations can employ to link their learning initiatives to corporate
strategy. Human capital and human performance technology (HPT) professionals need to push their
organizations to embrace a performance improvement agenda that is linked to strategy, and organi-
zations need to include a learning representative in the strategic development process. If the human
capital or HPT professional and CEO work together toward a common goal, the business can achieve
the greatest benefit from learning initiatives.

ORGANIZATIONS OFTEN SPEND exorbitant amounts
of money training employees. Executives are under
immense pressure to justify investments in learning or
performance improvement initiatives. However, it can be
difficult to gauge the return on these investments. This
stems from the fact that learning investments are typical-
ly not aligned well with a company’s overall strategy.
Thus, organizations are unable to measure the extent to
which these investments support their critical business
objectives.
If organizations do not first identify how learning pro-
grams can help them attain their strategic goals, these
programs can be wasteful and drain productivity. This
disconnect leads many executives to place a low value on
training initiatives.
THE SHIFT TOWARD INTANGIBLE
ASSETS
Businesses used to be valued almost exclusively in terms
of their tangible assets. But the world has changed signif-
icantly. According to research published in 2000 by the
Brookings Institution, only 15% of the value of today’s
organizations can be traced to tangible assets; the remain-
Performance Improvement, vol. 46, no. 2, February 2007
©2007 International Society for Performance Improvement
26 Published online in Wiley InterScience (www.interscience.wiley.com)
ing 85% of that value is intangible, consisting of such
things as knowledge and brand (Kaplan & Norton, 2004).
Human capital is now the dominant asset in today’s busi-
nesses. However, many executives still use financial man-
agement tools that treat human capital as an expense
instead of an asset.
THE CHALLENGE OF MEASURING
LEARNING ASSETS
Learning and performance improvement is an important
intangible asset in which organizations invest. However,
most organizations have a difficult time quantifying the
return on these investments. Measuring human behavior
and its contribution to organizational results has long
challenged management.
Today, some forward-thinking organizations are using
nonfinancial measures to communicate the importance of
investing in intangibles and to demonstrate intangibles’
effect on financials. The balanced scorecard is one tool that
organizations are using to set up metrics showing how
intangible assets help the company to meet strategic goals.
The balanced scorecard is a management tool that enables
organizations to clarify their strategy and translate it into
• DOI: 10.1002/pfi.105
action. It takes into consideration an organization’s busi-
ness processes and external outcomes to help management
to continuously improve strategic performance and
results. With the learning and growth perspective of the
balanced scorecard, organizations can measure objectives
such as culture, skills, leadership, teamwork, and knowl-
edge. Many organizations measure the extent to which
employees understand the organization’s strategy.
Investing in communicating the strategy and educating
employees on it has a big payoff. Organizations with a rel-
atively high percentage of employees who understand the
strategy are more successful than organizations with less
informed employees in executing their strategy (Norton,
2006). There is a cause-and-effect relationship between
employees’ understanding the strategy and higher em-
ployee engagement, more engaged customers, and better
financial results.
DEFINING CAUSE AND EFFECT
BETWEEN PERFORMANCE IMPROVE-
MENT AND FINANCIAL RESULTS
Essentially, a strategy map is a one-page picture of an
organization’s strategy that articulates the strategic objec-
tives (see the example in Figure 1). Defining a strategy
Source: Palladium Group, Inc.
FIGURE 1. STRATEGY MAP: LINKING PERFORMANCE IMPROVEMENT AND ENTERPRISE GOALS
map requires more than merely describing the strategy in
relation to the market of the business, however. It also
involves taking a holistic look at perspectives ranging
from financial statements to customer value propositions
to internal processes to learning and development roles,
each of which has a profound impact on the company’s
performance. Developing a strategy map is also very use-
ful for building consensus among executive team mem-
bers so they can agree on the investments they need to
make in their people.
Defining a strategy map is necessary for understanding
the context for cause-and-effect relationships within the
organization. Although business leaders may intuitively
understand this cause-and-effect chain, it is often difficult
to define and map these relationships in an unambiguous
manner. Many organizations do not have a clear way to
communicate their strategy throughout the organization.
In fact, a 2006 study by the Palladium Group and Cognos
Inc. found that up to 95% of organizations do not tell
their employees what the organization’s business strategy
is. Although many businesses invest in strategic planning
documents, the resulting decisions are often not well
articulated and shared throughout the enterprise.
A strategy map is an effective tool for organizations
looking to better communicate their strategy to all
employees and stakeholders. Once developed the strategy
Performance Improvement • Volume 46 • Number 2 • DOI: 10.1002/pfi 27
map is a point of reference for Human Performance
Technology (HPT) professionals to define the impact of
human capital and performance improvement on the
strategy and to tailor their development and performance
improvement programs to strategic priorities. Ultimately,
this framework enables the organization to better under-
stand which performance improvement initiatives are an
effective means for achieving its business strategy.
A strategy map helps organizations identify not only
what they intend to accomplish but what they have cho-
sen not to accomplish. This understanding can guide
executive teams in making hard decisions about which
learning initiatives to invest in and which ones to elimi-
nate as not critical to achieving key business goals.
Strategy maps focus the human capital investments on
the right tasks and create partnerships to drive strategy
execution.
IDENTIFYING STRATEGIC
JOB FAMILIES
Investing in performance improvement programs for all
employees is a noble idea in theory, but in reality some jobs
have a much greater impact on an organization’s strategy
than others. Comprehensive programs often result in
learning or performance consulting resources being dilut-
ed across the entire enterprise––with little measurable
benefit. It is important for businesses to determine the cat-
egories of job competencies that have the greatest impact
on enhancing the organization’s critical internal processes.
These strategic job families are where more performance
improvement investments should be focused.
For example, a major lending institution differentiates
itself through outstanding customer service, breadth of
service offerings, and integrity. To that end it pinpointed
three job families that provide the key leverage points for
its overall goals: product managers who oversee the
launch and execution of new product offerings, relation-
ship managers who proactively reach out and engage cus-
tomers in new opportunities, and the compliance officer,
who helps create a culture of accountability. Once these
strategic initiatives were defined, the business was able to
identify learning interventions that clearly aligned with
this goal.
Moreover, these three job families represented only
300 of the company’s 6,000 employees, or 5% of the
company’s workforce. By focusing human capital devel-
opment activities on these 300 individuals, the lending

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28 www.ispi.org • DOI: 10.1002/pfi • FEBRUARY 2007

institution drove down operating costs for nonessential CONCLUSION
training activities and optimized its learning investments
Leaders who align human resources with strategic prior-
for these key employees.
ities enjoy greater financial results as well as several
The Walt Disney Company had a similar experience.
intangible results, such as increased retention, greater
The company evaluated its huge workforce to identify
employee engagement, and improved competitive
which job families required the most focus in terms of
advantage. Human capital and performance technology
performance development. One interesting revelation
professionals can empower organizations to be success-
was that street sweepers were identified as part of a strate-
ful by helping them embrace a performance improve-
gic job family. Previously, this role was not thought of as
ment agenda that is linked to strategy. Having a learning
business critical. However, in its evaluation of job fami-
representative integrated into the strategic development
lies, Disney realized it was the people in this role who had
process is a critical factor in ensuring the success of per-
the most intelligence about how visitors were seeing the
formance improvement initiatives. With the human cap-
property and what aspects of the park visitors responded
ital or HPT professional and the CEO working together
favorably to. Moreover, because cleanliness is a key differ-
toward a common goal, the business can achieve the
entiator for the park, the company realized that learning
greatest benefit from learning initiatives. Focusing
and development for this job family was a wise invest-
learning investments is key to success, and this will
ment (Boudreau, 2002).
enable organizations to understand and quantify the
cause-and-effect relationship of performance improve-
ELEVATING THE ROLE OF HR ment investments to business results.
Another important way to improve the results of learning
initiatives is to engage a human resource or human capi-
References
tal professional in strategy map discussions to ensure that
the development of HPT programs takes into account the Boudreau, J.W. (2002, February 27). Getting out of the box:
overall business plan. Forward-thinking organizations are Bridging HR and business success. Presentation at Balanced
moving beyond the mode of having HPT act only as a Scorecard Collaborative Human Capital Conference,
support function; it is a part of the business. Many busi- Orlando, FL.
nesses have hired chief learning officers to ensure that
Kaplan, R.S., & Norton, D.P. (2004). Strategy maps: Converting
someone at the executive level is dedicated to establishing
intangible assets into tangible outcomes. Boston: Harvard
a structure for learning and to infusing the strategic view
Business School Press.
of the business through learning initiatives. To that end
the U.S. government has enacted legislation recommend- Norton, D.P. (2006, March). Survey of 143 performance man-
ing that every federal agency have a chief human capital agement professionals from Balanced Scorecard Collaborative
officer who will ensure that the right investments will be online community at bscol.com. Lincoln, MA: Balanced
made in these agencies’ human capital. Scorecard Collaborative/Palladium Group.

CASSANDRA A. FRANGOS is the human capital practice leader at Palladium Group, Inc., the
world’s leading authority on strategy execution. She leads research programs on human capital and
consults to Fortune 500 organizations, including American Express, Canon, Merck, Wells Fargo, and
others in the areas of strategic management, human capital strategy, HR balanced scorecard, and
performance management. A recognized thought leader, Cassandra has published several
articles––including “Creating a Strategy-Focused Workforce,” which appeared in the Balanced
Scorecard Report (Harvard Business School Press)––and has presented at several leading industry
events worldwide. She has also collaborated with the cocreators of the balanced scorecard and strat-
egy maps, Robert Kaplan and David Norton, to identify next generation best practices in human cap-
ital. Cassandra may be reached at cassandra.frangos@palladiumES.com.

Performance Improvement • Volume 46 • Number 2 • DOI: 10.1002/pfi 29