Strategic Frameworks

Strategic Frameworks
5 of the best & how to choose one

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Wow! Well explained
and has helped me
prepare for a strategic
planning session in a
more simpler way...
Zo Mbelle
Quick intro...
Strategic frameworks are great for helping you to create and execute strategy. But choose
the wrong one, and you could end up wasting a lot of time and effort. Worse still, the
wrong strategic framework could sow confusion and disengagement throughout your
organization.
If you’ve ever worked at a large corporation, it’s likely that you’ve already encountered at
least one of the most popular strategic frameworks - the Balanced Scorecard. Many large
organizations use the Balanced Scorecard as part of their performance management
process. But if I were to ask:
“Why did my organization use the Balanced Scorecard,

and what tangible benefits did it bring?
Could you answer that question? This guide is all about helping you to choose the right
strategic framework for your strategy, and understand how to get the most from it.
executestrategy.net Page-4
04 Quick Intro
06 What is a Strategic Framework?

Contents
07 Should You Even be Using a Strategic Framework?
08 The Benefits of a Strategic Framework to Strategy

Formulation
09 The Benefits of a Strategic Framework to Strategy

Implementation
10 Choosing the Right Strategic Framework
12 McKinsey’s Strategic Horizons
19 Value Disciplines
30 Stakeholder Theory
38 The Balanced Scorecard
53 Ansoff’s Matrix
What is a Strategic Framework?
A strategic framework is a tool that will assist you at a specific stage of the strategic
management cycle, most commonly during the strategy formulation and evaluation stage.
Usually, strategic frameworks will require you to categorize your goals into a series of
groupings. The strategic framework that you choose should therefore reflect the overall
outcomes that you want to achieve.
Popular strategic frameworks include the Balanced Scorecard, McKinsey’s Strategic

Horizons, Ansoff’s Matrix, Value Disciplines and the Stakeholder Theory.
A strategic framework will usually make up a component within your overall Strategy
Model - though it’s important to note that you don’t necessarily need a strategic framework
to have a complete Strategy Model.
Should You Even be Using a
Strategic Framework?
Strategic frameworks are great tools, but they aren’t strictly necessary when it comes to
formulating and executing strategy. If you’re struggling to come up with an effective set of
goals, then you should absolutely give strategic frameworks a try. But if you’re comfortable
with your vision and your plan for getting there - it may be that adding a strategic
framework into your Strategy Model only serves to confuse people.
If your organization is new to strategic planning, or has a low degree of strategic maturity,
you might want to hold back on full implementation of a strategic framework. That doesn’t
mean that you can’t ‘sense check’ your plan against a strategic framework - but you don’t
necessarily have to communicate the framework aspect to your wider team, if you think it
risks confusing them.
The Benefits of a Strategic
Framework to Strategy Formulation
The benefits of a strategic framework generally apply to two key elements of the strategic
management process. The first of these elements is strategy formulation.
Strategic frameworks help in the formulation stage by giving you a ‘template’ for
categorizing your goals. This template then prompts you to think about the different
components of the outcomes that you want to achieve.
For example, McKinsey’s Strategic Horizons is a great strategic framework to use for
organizations who are trying to boost their innovation (more on that later). The framework
essentially requires you to categorize your activities as one of 3 ‘horizons’ - which can
be simplified to ‘short term’, ‘medium term’ and ‘long term’. By having those 3 categories
in front of you when you create your plan, it requires you to consider whether or not
your goals are going to serve the short, medium and long term innovation needs of your
organization.
Using a strategic framework in the formulation stage of your strategy helps ensure that
you don’t miss anything and provides a great sense-check for the robustness of your
strategy.
The Benefits of a Strategic Framework
to Strategy Implementation
The benefits of a good strategic framework aren’t limited to formulation. Once you’ve
started to execute your strategic plan, you’ll start to have data about which of your goals
you’re hitting and which are lagging behind.
Applying a strategic framework at this point helps to analyze where your current strengths
and weaknesses are as an organization.
For example, the Stakeholder Theory requires to categorize your goals by which of your
key stakeholders will benefit the most from that particular goal (more on that later). For
example, say you have a goal of ‘Launch a new online customer service portal’ - the key
stakeholder that will likely benefit the most is ‘Customers’.
By applying a strategic framework when looking at the progress of your goals, it can help
you get a sense (in the case of Stakeholder Theory) of which of your stakeholders you’re
serving the best. Not by virtue of the presence of the goals in your strategy, but by virtue of
which goals you’re actually achieving.
In turn, these kind of strategic insights can help you make adjustments either to your
strategic plan, or to the resources that you’re investing in your different goals, to ensure
the the outcomes you’re achieving line up to your overall vision.
Choosing the Right Strategic
Framework
Now that we’ve identified the benefits of a good strategic framework, let’s turn our
attention to which strategic framework is best for you.
The answer to this question is going to come down to what problem you’re trying to solve
by implementing a strategic framework. To make things easier, we’ll be focusing on 5 of
the best strategic frameworks out there, and telling you which one is best for your set of
circumstances.
Note, that we won’t be going into the detail of each strategic framework in this article, but
for each one we’ve linked to a more detailed article that explains the framework and how to
implement it, so be sure to follow those links for any strategic framework that peaks your
interest!
The following diagram is a rough guide to help you select the best strategic framework for
your strategy:
ORGANIZATIONAL BALANCED STAKEHOLDER

SCORECARD THEORY
MATURITY
VALUE
DISCIPLINES
MCKINSEY'S
ANSOFF'S
STRATEGIC
MATRIX
AGRESSIVE HORIZONS
GROWTH
FORMULATION EXECUTION
Choosing the Right Strategic
Framework
The x axis of the graph above refers to whether you’re looking for a strategic framework
that is more focused on formulation (far left) or execution (far right).
The y axis is designed to represent what stage of maturity your organization is at - if you’re
a younger organization (or team) and trying to grow aggressively you’ll be towards the
bottom, whereas if you’re a more mature organization looking to do ‘more of the same but
better’ you’ll be towards the top of the y axis.
Let’s dive into each of our strategic frameworks in more detail...
McKinsey’s Strategic Horizons
(overview)
The best strategic framework for organizations looking to grow aggressively, but who want
a framework that balances formulation and execution equally.
It’s no secret that I love the McKinsey’s Strategic Horizon framework. I love it because of
all the strategic frameworks out there, it does the best job of straddling both formulation
and execution.
This strategic framework requires to create a set of long-term goals focused on innovation
(Horizon 3), then set out the main goals that you’re working on today (Horizon 1) and
finally create a set of ‘bridging activities’ (Horizon 2) for how to get from today, to your
ideal future state.
This elegant approach to strategic planning not only helps you to ensure that you’re being
ambitious (Horizon 3), but also forces you to be realistic about your current business
priorities (Horizon 1) and ensures that you have activities in place to help you bridge the
gap (Horizon 2).
That’s not only useful for strategy formulation, but it also helps with strategy execution
as well. Once you start building up tracking data for your goals, you’ll get a sense of how
effective you’re being across each of the 3 horizons. Nailing your Horizon 1 goals, but
failing miserably on your Horizon 2 goals? That’s a major problem for your strategy - and
McKinsey’s Strategic Horizons will help you identify that early.
What are McKinsey’s Three
Horizons of Growth?
McKinsey’s Three Horizons of Growth are all about keeping you focused on growth and
innovation. This strategy framework requires you to categorize your goals into 3 different
‘horizons’:
Horizon 3:
Create genuinely
new business
Horizon 2:
Value Nurture emerging
business
Horizon 1:
Maintain & defend
core business
Time
Horizon 1: Maintain & Defend Core Business
Activities that are most closely aligned to your current business.
Most of your immediate revenue making activity will sit in horizon 1. For a retailer, this
would include the day-to-day goals associated with selling, marketing and serving your
product/customers. Your goals in horizon 1 will be mostly around improving margins,
bettering existing processes and keeping cash coming in.
What are McKinsey’s Three
Horizons of Growth?
Horizon 2: Nurture Emerging Business
Taking what you already have, and extending it into new areas of revenue-driving activity.
There may be an initial cost associated with your horizon 2 activities, but these
investments should return fairly reliably. This is based on them being an extension of your
current proven business model. Examples of this could include launching new product
lines or expanding your business geographically or into new markets.
Horizon 3: Create Genuinely New Business

Introducing entirely new elements to your business that don’t exist today.
These ideas may be unproven and potentially unprofitable for a significant period of
time. This would encompass things like research projects, pilot programs or entirely new
revenue lines that require significant upfront investment.
What does McKinsey’s Three Horizons
of Growth help me to achieve?
Most organizations want growth. Most organizations also acknowledge that innovation
is a critical component of achieving that growth. Yet so many of them treat innovation as
one-off events. Such as a huge project to be delivered, or a set ‘innovation program’ to
be introduced. One of the most common reasons for this approach is the perceived gap
between the innovation of tomorrow versus the reality of running the business today.
McKinsey’s Three Horizons of Growth aims to help you bridge this intellectual gap. It does
this by creating stepping stones between running your business profitably today and
growing it for the future.
This strategy framework helps ensure that you consistently balance your focus between
the needs of today (horizon 1), the future state of your business (horizon 3) and the steps
that you need to take to get there (horizon 2).
The Three Horizons of Growth framework is an extremely versatile strategy framework,

applicable to most organizations. In particular the framework lends itself to organizations
who’ve identified that growth and innovation have been a stumbling block. If you feel
as though your organization is mired in ‘chugging along’ delivering business as usual -
McKinsey’s Three Horizons of Growth might just be the right strategy framework for you.
How do I apply McKinsey’s Three
Horizons of Growth to my Business?
OK, so you’ve decided that growth and innovation are indeed critical to your business, and
you’re willing to give McKinsey’s Three Horizons a shot at helping you get there. This is
how to go about applying it to your own organization:
Start with a deep understanding of your horizon 1

You first need to identify your biggest assets today. The main reasons why your business
makes revenue or succeeds at what it does. If you were Starbucks, this would be your
brand and perhaps your distribution channels. If you were Microsoft (back in the 1990’s) it
would be your enterprise products and perhaps your partner network. Name these drivers
of success for your business today.
Now, imagine that you lost them entirely. Imagine that you’re Microsoft and businesses
refuse to buy your software anymore...
Your horizon 3 is what you would do if that were to happen

Yep, that’s not a typo - we’re moving straight to horizon 3. Let’s stick with Microsoft as
an example. The Microsoft Xbox was launched in 2001. On the surface, it was a million
miles away from playing to Microsoft’s core strengths at the time, which were firmly in the
business and productivity space. And that was exactly the point. The Xbox wasn’t a shot in
the dark - it was Microsoft’s horizon 3. They’d identified something at which they thought
they could succeed (you still need core capabilities that will allow you to win). However
they didn’t rely on the things that were making them a success today.
But how did they go from strength in business software/productivity to winning in the ultra-
competitive gaming hardware industry?
Horizon 2 is the bridge that gets you there
This is where horizon 2 comes in. Once you know what you want to do for your horizon 3,
work backwards from that (and forwards from your horizon 1) to create a plan of action
that will bridge the gaps.
For Microsoft, that involved launching their own line of computer games (famous ones
include Age of Empires and Microsoft Flight Simulator). It also included a range of ‘light’
hardware such as keyboards and mice. This gave them the experiences they needed (and
a bit of extra revenue too) in both gaming and hardware, that ultimately resulted in them
creating the Xbox.
Your horizon 2 doesn’t have to be a revenue generator per-se, but it should contain enough
of your core assets from horizon 1 to give you a fighting chance of it being profitable. The
bigger picture though, is that it helps you to bridge the gap between your today and your
desired future state (horizon 3).
The 70 / 20 / 10 rule
To put this into practice for your strategic plan, try to ensure that around 70% of your
activity is playing towards your horizon 1. After all, you need to survive and thrive today to
have any chance of succeeding tomorrow.
Then, allocate around 20% of your effort to the those horizon 2 ‘bridging’ opportunities.
That might sound like a lot, but horizon 2 will contain failures and false-starts, so it’s
important that you have enough irons in the fire to get you to horizon 3.
For horizon 3, that leaves 10% of your overall effort. That 10% is important. Without it,
you can easily lose sight of your ultimate goals, and get lost in a never-ending cycle of
horizon 2’s. Microsoft for example experimented with a range of simple game controllers
throughout the 1990’s called the Microsoft Sidewinder. Most of your horizon 3 10% efforts
will be on research and experimentation, with a few light product launches towards the end
if you’re lucky.
So...what next?
If you’re liking the sound of McKinsey’s Three Horizons of Growth, have a go at applying
it to your own business. An easy place to start is to take a look at your existing strategic
plan, and overlay what you’ve learnt about the different horizons to that plan. Ask yourself
the following questions:
• How close are you to the 70 / 20 / 10 rule?

• Do you have a clear understanding about your current reasons for success?
• Do you have a plan for if they were to be taken away from you?
If you’re not satisfied with your answers to those questions, then McKinsey’s Three
Horizons of Growth could be just the framework for you.
Value Disciplines Overview
The best strategic framework for organizations who want to keep growing quickly, but
already have a good sense of what they need to focus on.
Value Disciplines sits right in the middle of our graphic, as it does a pretty good job of
touching all the bases when it comes to strategy.
In a nutshell, Value Disciplines requires you to categorize your goals into one of three
categories:
• Customer Intimacy
• Product Leadership
• Operational Excellence
The idea being that as an organization, you should primary be focused on just one of the
three in order to ensure focus and success.
This approach is helpful for formulation, since it forces you to be razor-focused on

ensuring that the majority of goals sit in just one of the quadrants. It also brings benefit to
the execution phase however, since over time it’s very easy for organizations to lose focus,
and applying Value Disciplines on an ongoing basis helps you catch that kind of strategic
drift nice and early.
From an organizational maturity perspective, you might want to start off with a slightly
more aggressive strategic framework such as Ansoff’s Matrix before graduating to
something like Value Disciplines as your organization matures. This is because Ansoff’s
Matrix deals with strategy formulation a higher level than Value Disciplines.
Value Disciplines Explained
The Value Disciplines concept was solidified by Michael Treacy and Fred Wiersema in
their book: The Discipline of Market Leaders. Having researched and observed trends in
companies such as Wal-Mart, Dell, Southwest Airlines, Intel and Sony, the authors presented
a business model with three key competitive areas:
• Customer Intimacy
• Product Leadership
• Operational Excellence
They propose that for a business to be competitive, they must do well in all three areas.
However, organization’s that wish to become market leaders in their category, need not just
do well, but excel in one of these. Let’s first break each one of these down and look at what
they represent. Then, we’ll look at how they co-exist and why no organization can really excel
at all three (as nice as that would be).
Customer Intimacy of Value
Disciplines
The easiest way to explain the concept is to use this statement:
Your organization must become obsessed with understanding the

individual customer in detail.
This will then help you to excel in customer service and customer attention.
Customer intimacy in the Value Disciplines goes beyond understanding your customer’s
needs and wants. It means having a full range of services available to help serve your
customers on demand. Think of it as a concierge for customer service. E.g. you know
you’re in a good hotel when the concierge gets to know you to the point where they not
only serve you IN the hotel but also outside. The concierge may do this by providing advice
you wouldn’t normally get on a brochure or Googling. They may even arrange services for
you well outside the scope of the hotel (arranging for a tailor to come to the hotel).
This level of intimacy with the customer gives your organization a unique opportunity
to bring unparalleled value to your customers. That’s a huge deal, because it allows
you to differentiate yourself against your competitors. Also, it helps you to compete on
value, rather than price (and most likely charge a significant premium for your product or
service).
Customer no longer place the value on the product or service alone, but rather the
familiarity in the process. A company that comes to mind when it comes to customer
intimacy is Zappos. Zappos customer service team are known for going well above the
call of duty. Zappos don’t just keep customers happy, but also surprise them along the
way. Here are some great examples of Zappos stories online. More traditional examples
of companies with a customer intimacy approach include Home Depot, Staples in office-
supply retailing, Ciba-Geigy in pharmaceuticals, and Kraft.
Customer Intimacy of Value
Disciplines
The guiding principles for effective Customer Intimacy are:
• Having a full range of services available to serve the customers on demand. This may
involve having a wide range of services available from other suppliers at very short
notice through contract arrangements.
• A corporate philosophy and resulting business practices that encourage deep customer
insight. This helps deliver breakthrough thinking about how to improve the customer’s
situation.
How would you measure Customer Intimacy?

This can seem a little vague at first, since customer intimacy is not necessarily a tangible
dimension. Also, it’s often hard to simply quantify the success of customer intimacy.
When we look deeper though, there are certain areas we can measure to help understand
customer intimacy success. These measures will help paint a picture of how effective a
customer intimacy approach can be for an organization:
• Reach and range – This involves the location of service access points, number of
channels the product or service can be accessed and levels of self-service available
• Cycle time – Measuring the time between awareness of customer need and delivery, and
product or service development time
• Product identification – The ability to identify new products or services required by
customers.
Focusing on customer intimacy is a fantastic way to differentiate your business. It can take
time and a significant amount of money to achieve. But if done well it can give you a nearly
unassailable competitive advantage.
Product Leadership of Value
Disciplines
This is simply about leading the charge in product development. Though a simple concept,
it is often a difficult space to compete in. Your ability to compete in this space will often
be dictated by the level of investment an organization can allocate to researching and
developing a product so that it not only leads the market but also remains well ahead of
any competitors (easier/cheaper said than done!).
To do this effectively, an organization needs to challenge itself in three specific ways:
Creatively - meaning that they often need to embrace ideas that are
usually outside the company’s normal scope
Commercially - the ideas need to move through their due process

quickly to reach the market first
Relentlessly - such a product leader must be relentless in their pursuit

of new solutions to problems they may have just solved. In the tech
space, for example, this means continuously rendering your latest
product obsolete (better you do that than your competition).
Apple is probably the poster child in terms of product leadership. However, in recent
times this has become increasingly debatable (I can already hear the screams of iPhone
fanboys!). Regardless, Apple has always aimed to lead through developing a better
product. Their drive for innovation is so embedded into the organization, that it became
part of the marketing (“Think Different” campaign).
Product Leadership of Value
Disciplines
Guiding principles of an effective product leader are:
• Encouragement of innovation – Maintain a company culture that allows experimentation

and innovation and rewards product or service improvement
• Risk-oriented management style – Having management team that allows the
organization to take risks and reap the rewards of new ventures (of course this means
an inevitable number of failures in the process)
• Recognition that the organization’s current success and future prospects lie in its
talented design people and those who support them
• The drive to educate and lead the market in the use and benefits of new products or
services.
How do you measure Product Leadership?

Though the initial measurable focus area would be market share, this does not
immediately indicate product leadership in a particular product category. If we look at
the smartphone market, for example, Apple is still seen as the market leader, although
Samsung moves more units. Apple managed to position itself as the innovator at the early
stages of the competition, so customer perception tends to lag. Some areas that can help
identify product leadership include:
• Capability maturity – The ability to maintain the level of capability to deliver products or
services and the continuous improvement of those capabilities
• Intellectual leverage – Being able to develop and use intellectual assets for improved
product and service delivery
• Responsiveness – minimizing the response and turnaround times for product and
service design and delivery (getting to market quickly)
Operational Excellence of Value
Disciplines
Operational excellence revolves around the principal of low or lowest price and hassle-free
service. This is simplifying the concept somewhat, but essentially the organization aims to
lead the market through price and convenience. The goal is not to simply be the cheapest
(from a financial point of view, that can be a journey to the bottom), but to really create an
environment for the customer where friction is minimized or completely eradicated.
Dell is a perfect example of this principle. While Compaq computers concentrated on

making faster and cheaper machines than IBM, Michael Dell saw an opportunity from his
college dorm. He still focused on the product (faster cheaper) like the competitors but
decided to emphasize the delivery system.
Dell was able to compete by delivering products to order rather than to inventory (cutting
out the middleman and reducing costs) and still maintain quality and service.
The guiding principles for operational excellence revolve around:
• Efficient management of people – Developing a culture and training focused on efficient

and low-cost ways of doing things
• Management of efficient transactions – Being able to maximize the efficiency of all
facets of a transaction, including the full supply chain
• Dedication to measurement systems – Focus on quality AND cost control (with an
emphasis on finding ways to reduce costs). Manage customer expectations by limiting
products and services (avoid over-promising).
Operational Excellence of Value
Disciplines
How do you measure operational excellence?
There are three key areas that can help measure how well an organization is performing in
this space. These are:
• Costs - By analyzing and adjusting processes and products to facilitate the most cost-
effective delivery
• Quality – By detecting, understanding and removing problems through processes,
products, and services that have efficiency impacts both before and after delivery
• Organisational performance – Maintain efficiency through improved processes and
automation for speed and hassle-free delivery
If you are familiar with the concept of “Kaizen” from Japan, you will agree that the
operational excellence concept borrows a lot from it. In fact, Toyota, is a brand know for its
operational excellence.
Can’t I be great at all three?
The short answer is no. Like anything in business though, it depends. The initial reaction
when I looked at this framework was to strive to excel in all areas. Alas, Treacy-Wiersema
argues that an organization will find it very difficult to excel in all three disciplines.
Treacy-Wiersema argues this since the organizational culture, structures, people,
facilities, processes and business models that lead to excellence in one discipline are not
compatible when attempting to achieve the same in the other two disciplines. For example,
Dell would find it hard to break into the product leadership discipline. All Dells processes
are geared to providing customized solutions at the lowest possible price. This is a very
different business model from Apple who produce few products but with an intense
attention to product detail.
Having said that, it doesn’t mean it is not possible. There are companies out there
that have somewhat achieved this. Let’s take Staples, the office supply giant in the
United States. They have adopted both operational excellence and customer intimacy.
Staples achieves the lowest net-landed cost in the entire office stationery business.
Recently though, Staples pushed for customer intimacy, by creating a Staples ‘club’ with
membership and discounts. They now use the data they gather from the club members to
serve better and deepen their relationship with these customers.
Indeed, if we look at the tech space and some of the companies that are disrupting the
market, we see that a lot of them manage to excel at two of these areas effectively. If we
look at Airbnb for example, the business offers operational excellence from a high level of
customer intimacy. This could be said about Uber also.
How can you apply this framework to your business?

An organization looking to define it’s direction and quickly gain a competitive edge may
use The Value Disciplines Framework as a tool. More than a discipline, once you ‘stake
your claim’ in one of these areas, an organization can turn this into a philosophy that
is embedded within the company. When that is achieved, employees resonate with the
discipline and will aim to uphold it vigorously. It can almost become the WHY of the
organization, and this can not only give you a competitive edge but a cultural one as well.
Can’t I be great at all three?
The trick is to not forget that simply because you focus on one discipline, there is no
neglect of the other two. Remember, you MUST compete in all three disciplines - there is
no choice in that. The choice is simply to make a conscious decision to excel in one.
Cascade’s Value Discipline

Here at Cascade, for example, we’ve made a conscious decision to excel in customer
intimacy. We do this by going that extra mile for our customers. We don’t just provide
Cascade as a strategy tool, but as something that integrates with an organization. The
way we do that is by really understanding the needs of an organization and going well
beyond the software to facilitate success. This doesn’t mean we don’t focus on our product
(most of our team is comprised of developers). But, it is everyone’s responsibility to
know, understand and better serve our customer. If our customer feedback and reviews is
anything to go off, you can see that customer intimacy is a core strength for Cascade.
The Value Disciplines Summary
Value Disciplines is a really powerful strategy framework. Value Disciplines can be quite
flexible, but it is not for everyone. For example, if a business offers customer care as a
service, trying to focus on a discipline other than customer intimacy will offer limited
value. It pays to look at the concept and determine if it really is a good fit for your current
structure. If you want to read more about this framework, I strongly suggest picking up the
book: The Discipline of Market Leaders.
If you’re curious to see how this framework could work for you, why not use our platform
to visualize it? Cascade Strategy allows you to quickly build your plan, along with
organizational goals and tasks, to help you quickly determine how this type of strategy can
help. Give it a try!
Stakeholder Theory (Overview)
The best strategic framework for organizations who aren’t specifically focused on growth,
and have a clear idea of who they need to serve.
Stakeholder Theory is a nice strategic framework that tends to be popular amongst

charities, non-profits and government organizations. That’s because Stakeholder Theory
doesn’t really help much with formulation, nor does it help much with trying to grow your
business aggressively. But what it does help with, is keeping you razor focused on ensuring
that you’re delivering on goals that meet the needs of your primary stakeholders.
Stakeholder Theory is a great way to help you connect your strategy to your culture, as it
helps get everyone get on the same page about why your organization exists and who it
serves.
Milton Friedman is one of the most famous economists of all time. He put forward a theory
(among many others) that companies are ultimately beholden to just one stakeholder -
their shareholders. He called this ‘Shareholder Theory’. Stakeholder Theory is in many
ways a direct contradiction to the mono approach suggested by Friedman, in that it
suggests that organizations are responsible to many different stakeholders, of which
shareholders are only one.
When you think about it, your own position on this is probably one of the first things you
should do before creating a strategic plan. It goes to the very foundations of what you
want to achieve and why you’re doing it. Are you here only to make money for yourself and
your shareholders? Or are you here to also improve the lives of your employees and the
community?
Understanding The Stakeholder
Theory
Ok, let’s dive into the detail of the theory a little more. We can sum up the stakeholder
theory as follows:
Stakeholder theory is based on the assumption that businesses can

only be considered successful when they deliver value to the majority
of their stakeholders.
That means that profit alone cannot be considered the only measure of business success.
Let’s take a look at some of the common stakeholders for a typical business:
Shareholders
No problem here - despite stakeholder theory being positioned as the antithesis of
shareholder theory, the reality is that shareholders (or yourself if you own the business)
will always be one of the biggest stakeholders you are responsible to. They are therefore
entirely in keeping with the philosophy of stakeholder theory.
Employees
Another no-brainer, even the most hard-nosed business person will agree that happy
employees is a good thing.
Customers
Customers are another obvious stakeholder to consider in the eco-system of your
business.
Communities
You can define community in a variety of different ways, from local to virtual. Either way,
they are a key player in stakeholder theory.
Understanding The Stakeholder
Theory
Friends & Family
This may seem a little odd, but your own friends and family (as well as those of your
employees) are also critical stakeholders to satisfy under stakeholder theory.
Competitors
Now things are getting a bit weird - why would you want to satisfy the needs of your
competitors? Well stakeholder theory suggests that a healthy competitive environment
benefits everyone, including other stakeholders such as customers.
There are plenty of other stakeholders you could identify such as suppliers, unions, trade
associations, political groups etc.
As you read the list above, you might think to yourself: “Sure, it makes perfect sense to
keep the likes of my employees and customers happy - because the happier they are, the
more money I’m likely to make.” And this is one of the most common misunderstandings
behind the stakeholder theory. The stakeholder theory is not about keeping stakeholders
happy to make more money. Instead it argues that companies play a vital role in the very
fabric of our society (creating jobs, innovating etc) and that therefore their success must
be valued as a whole, not just in the returns they make for their shareholders.
Benefits of applying stakeholder
theory
Here’s where things get a little complicated. Despite what I said in the final sentence of the
previous section of this post, there are financial benefits to applying stakeholder theory to
your organization. They include things such as:
• Higher productivity through employee satisfaction

• Improved retention / referrals from happy customers
• Increased investment from happy financiers
• Improved talent acquisition from a positive image in the community
• etc
So yes, applying stakeholder theory can literally help you drive profits to your business.
However these are more incidental outcomes of applying stakeholder theory than benefits
of the philosophy itself. To understand the true benefits of stakeholder theory, we have to
look at a more ethical / societal level. I’m talking about things like:
• Increased mental health of the workforce through job satisfaction

• Scientific progression which benefits all
• Elevation of the socio-economic status of the local community
• Contribution towards a healthy competitive ecosystem where other companies can also
thrive and bring benefits to their own stakeholders in turn
And, on an entirely personal (and selfish) level:
• The opportunity to work with like-minded awesome people who believe in making a
difference
• The sense of pleasure one derives from being part of positive change in your own little
corner of the world
Benefits of applying stakeholder
theory
Maslow’s Hierarchy
I actually liken the stakeholder theory to implementing Maslow’s Heirarchy of Needs, in
which Maslow states that to achieve true happiness one must go beyond material wealth
towards a state of self-actualization. The stakeholder theory is a great way to work
towards that for both yourself and your company.
So, if making the world a better place and likely achieving a whole range of profitable side
benefits sounds like your kind of thing - the stakeholder theory might just be for you.
Applying the stakeholder theory
to your business
We’ve presented the stakeholder theory as one of a number of different strategic models
that you can apply to help your organization succeed. You may even have found your way
to this post from our popular 5 of the Best Strategy Frameworks post. But I’ll say upfront
that the best way to apply the stakeholder theory model to your business is in conjunction
with another business framework. That’s because the stakeholder theory model isn’t really
a strategic framework - it won’t help you to innovate or grow your business directly. Instead
it’s more like a way of running your business, in a manner that’s aligned to your own
personal values.
Step 1: Define your stakeholders

Start-off by defining who your stakeholders are. You can start with the list we prepared
above, but you need think carefully about your own personal set of circumstances. Who do
you care about? Who will be impacted by the work your organization does? List them out in
simple bullet point form - you should have at least 5 or 6 and possibly many more.
If you’re struggling to come up with a satisfying list of stakeholders, talk to your
colleagues, friends and family - ask them who they think your organization should consider
a stakeholder.
to your business
Step 2: Analyze your activities
Look at your strategic plan - the objectives, goals, projects and KPIs that you’re using to
run your business. Start categorizing these activities into the list of stakeholders you have
identified. Do this by thinking about which stakeholders will benefit from your success
against any given goal.
• Focus on the ‘outcomes’ or ‘objectives’ in your strategic plan rather than the projects
and KPIs.
• Don’t think of this as a 1:1 relationship - a single outcome can contribute to multiple
stakeholders.
• Don’t be afraid to think broadly - it’s likely you won’t have specific goals that are aimed at
friends and family for example, but by thinking laterally you’ll probably find that some of
things you’re working on will help your friends and family indirectly at least.
Again, this is a great exercise to do with colleagues as you’ll get a range of different inputs
which you might not have thought about yourself.
Step 3: Understand your gaps

Let’s be realistic - the majority of your goals will likely be contributing to either your
shareholders, customers or employees. At least that’s true for most commercial
businesses. And that’s perfectly ok. Have a look at how your own strategy maps against
the stakeholders you’ve said you consider important. Does the breakdown look about
right? This is how it looked for us here at Cascade:
to your business
I would summarize our stakeholder alignment as follows:
• We’re predictably highly focused on shareholders, customers and employees.
• We have more goals contributing directly to customer than shareholders - which makes
sense as we are arguably more product-focused than sales-focused as an organization.
• We’re doing more in the competitor space than I expected - I suspect that’s because
part of our strategy is to help actually create / define the market for strategy execution
software.
• We are seriously under-represented in the friends / family and community stakeholder
groups.
The biggest action for me comes around that last bullet point. I really do value the positive
impact we can have on our community and will be recommitting to tangible activities that
can help this stakeholder group.
And I suppose this is really step 4: ‘Do something different’.

The whole point of exercises such as this is to aid your understanding of your own
organization, but then to take tangible steps to address any gaps that you identify.
Hopefully you’ve found this approach of reviewing your strategy interesting and insightful.
Don’t forget to check out our article on the 5 Best Strategic Frameworks - you’ll want to
implement at least one of them alongside your implementation of stakeholder theory.
Let me leave you with a final question to ponder. Imagine a business that:
• Has hundreds of incredibly happy employees
• Creates awesome products which significantly enhance the lives of their customers
• Has increased employment prospects for the local community
• Has inspired its competitors to improve their products and their customer service
Sounding pretty good so far right? Here’s the final bit of information: They consistently
make a loss of $1 each financial year.
Do you consider this a successful business or not? Would your answer be different if they
made a profit of $1 a year instead? The answer will be a personal one, but is a great way to
test your own position on stakeholder theory.
The Balanced Scorecard (Overview)
The best strategic framework for organizations who have a clear sense of purpose and
want to optimize their efficiency around delivering financial goals.
Despite being arguably the most popular strategic framework, the Balanced Scorecard is
really best suited for larger, more mature organizations. That’s because the primary aim
of the Balanced Scorecard is to help you optimize all aspects of your operations around
driving better financial returns.
The Balanced Scorecard is actually quite sophisticated, although people often over-
simplify it to be a simple list of categories into which your goals fall:
• Financial
• Customer
• Process
• Knowledge
In reality, the Balanced Scorecard is all about correctly working through your Customer,
Process & Knowledge goals in order to optimize your Financial goals.
As such, it can help you with strategy formulation, but only if you already have a good
sense of who your target market is, and what your overall strategy is (check out Ansoff’s
Matrix or McKinsey’s Horizons if you’re looking for a strong formulation framework for
earlier-stage organizations).
Rather, the Balanced Scorecard is well suited to organizations who are mature, and looking
for a tool to constantly optimize execution towards meeting their financial targets.
What is the Balanced Scorecard?
The Balanced Scorecard essentially calls for organizations to create a set of internal
metrics that will help them to assess their business performance in 4 key areas
(sometimes referred to as ‘perspectives’):
Financial
Typical scorecard metrics might include cash flow, sales performance, operating income or
return on equity.
Customer
With scorecard metrics such as: % of sales from new products, on-time delivery, net
promoter score or share of wallet.
Internal Business Process

This would include measuring things such as: unit costs, cycle times, yield, error rates, etc.
Learning and Growth

Examples of metrics being: employee engagement scores, retention rates of high
performing staff, skill increases of staff, etc.
What are the Benefits of Implementing
the Balanced Scorecard?
The 4 perspectives of the Balanced Scorecard serve a number of purposes.
Firstly, they require organizations to ‘balance’ their activities between the main drivers
of business success. They also force organizations to assign tangible metrics to each
perspective, increasing accountability. Finally, they also serve as a framework for
communicating the strategy of an organization to broader stakeholders. E.g. ‘We are doing
x because it helps us to succeed in the Customer perspective of our scorecard’.
One study showed that approximately 64% of organizations in the US were using the
Balanced Scorecard to measure business performance. When we look at the thousands of
clients with strategic plans in our own strategy system Cascade, we see a similar level of
popularity. Interestingly, we often talk with clients about how they’re using the Balanced
Scorecard only to discover that they aren’t even aware of the fact that they’ve implemented
it. Instead, they’ve come to their own conclusion naturally that they need to focus their
efforts and measures across roughly the same 4 perspectives that the Balanced Scorecard
calls for.
Ultimately, the benefit of implementing the Balanced Scorecard is that it forces your
organization into a level of focus that spans both leading KPI indicators as well as lagging
ones (more on that later).
What are the problems with
Implementing the Balanced Scorecard?
As with any popular strategic framework, the Balanced Scorecard has picked up its fair
share of critics over the years. The main criticisms of the Balanced Scorecard are that:
• It takes too much time to set up across your organization.

• People never fully understand it and therefore fail to benefit from it.
• It’s too rigid and doesn’t account for changes in the business landscape. Specifically
that it’s too focused on financial measures above all else.
• It’s too internally focused, almost completely ignoring macro-economic or competitive
aspects of running a business.
The truth is that the Balanced Scorecard is an excellent tool that when properly
implemented, and will likely benefit most organizations. Many of the problems with
implementing the Balanced Scorecard come from the fact that it is so often viewed as a
mere reporting framework rather than a true way of managing your business.
How to Effectively Implement the
Balanced Scorecard
Before we dive into the detail of how to implement the Balanced Scorecard for your own
organization, we need to take a look at what people so often get wrong.
A lot of people look at the Balanced Scorecard as 4 simple perspectives that you simply
‘slot your goals’ into. When they visualize the Balanced Scorecard, they think of it like this
diagram:
Balanced Scorecard
4 simple perspectives that link together to give you a Balanced Scorecard of your business
performance. Each perspective containing a list of Objectives, Projects and KPIs which
you then go away and work on. The end goal being to try and balance each perspective and
therefore ensuring overall success.
This approach to implementing the Balanced Scorecard is however fundamentally wrong.
The Balanced Scorecard is not a series of equally weighted perspectives. It is rather

a process whereby, starting at the bottom, you work your way upwards through each
perspective with a view to delivering the topmost - Financial Gain.
Each perspective unlocks your ability to deliver effectively against the one above it. So
instead of the diagram above, you need to visualize the Balanced Scorecard more like this:
Balanced Scorecard
If you follow the steps in the diagram, you’ll see that the ultimate end of the journey is to
increase profitability (Financial).
Another way to think about the Balanced Scorecard is as a series of leading and lagging
steps (similar to leading and lagging KPIs, though broader as it also applies to your
Objectives and Projects). Learning and Growth / Internal Processes / Customer - these are
your leading steps, as they will facilitate the delivery of your one and primary lagging step,
which is your Financial performance.
Indeed, this is one of the major criticisms of the Balanced Scorecard, that it essentially
‘ends’ at making more money. It’s argued that the scorecard wouldn’t suit organizations
such as Google and Facebook who claim their objectives go beyond financial returns
alone.
Why this Approach to Implementing the
Balanced Scorecard Makes Sense
Let’s work through the theory behind implementing the Balanced Scorecard as a series of
‘steps’.
Your ability to learn and grow will directly dictate your ability to better manage your
internal processes. In turn, as your internal processes improve, this will have a positive
impact on your customers as well as directly reducing your costs. The combined benefit of
this lower cost/higher customer engagement in your product (essentially sales) will lead to
your end goal, increased profit and financial return.
The Balanced Scorecard isn’t really about distinct perspectives, it’s about the layers
of a pyramid. The pyramid when built up in the right order, leads to success. When
implemented in this way, the Balanced Scorecard can be immensely powerful in helping
your organization to:
• Create a tangible road-map from the ‘current state’ to a more successful ‘future state’.
• Identify major roadblocks and areas where you lack the critical competencies to proceed
to the next stage.
• Articulate how your goals will directly help the organization to move upwards through
the stages.
• Prioritize business activities in the order they need to be tackled to allow the most rapid
progression through the stages.
Specifically, the main benefit of the Balanced Scorecard is likely to come less from
the creation of the perspectives themselves (which are fairly natural and obvious
categorizations for most businesses), but rather from the strategic management process
using the perspectives as stages.
Implementing the Balanced Scorecard
for your Business
We’re going to break down the process of implementing the Balanced Scorecard into two
key areas. In reality there are lots of micro-steps in between, but this should give you a
pretty good starting point.
Implementing the Balanced Scorecard in Strategic Planning

One of the most effective places where you can implement the balanced scorecard is in
your strategic planning process. Arguably this is the first and most important step in full
implementation of a Balanced Scorecard methodology, since it sets the foundation stones
for everything that your organization will do going forward.
There are two ways that you can implement the Balanced Scorecard from a strategic
planning perspective:
Method 1: Using Focus Areas
This Balanced Scorecard implementation methodology essentially involves orienting your

whole strategic plan around the Balanced Scorecard. You’ll set each of the 4 perspectives
as one of your strategic Focus Areas and then add Objectives, Projects and KPIs directly
underneath each perspective. You’ll end up with a plan that looks something like this:
for your Business
The benefit of this method is simplicity and total commitment to the Balanced Scorecard
methodology. By setting your Focus Areas as each of the perspectives, you’re stating very
clearly that your strategy is geared around the Balanced Scorecard and you’ll likely drive a
better understanding of the methodology throughout your organization.
This implementation methodology is best suited to organizations who want to keep their
strategy fairly simple, or who consider themselves slightly less mature from a complex
strategic planning side of things. Organizations who are more mature in their strategic
planning processes might want to consider method 2.
Method 2: Using ‘Goal Types’
The second method of implementing the Balanced Scorecard gives you the flexibility to
define your own Focus Areas separately from the Balanced Scorecard, and instead requires
you to ‘categorize’ your activities using a custom field for each of your Objectives, Projects
and KPIs. It will give you a strategic plan that looks something like this:
for your Business
As you can see, the Focus Areas (on the left) are not directly related to the Balanced
Scorecard perspectives, and instead, the perspectives are denoted on the right of the page.
This is a slightly more sophisticated way of implementing the Balanced Scorecard as it

allows you to mix and match how you group your goals. That can be a good thing or a bad
thing depending on how mature your organization is with regard to strategic planning.
Add Objectives, Projects and KPIs for each Perspective
Regardless of which method you choose, you’ll want to ensure that each of your
perspectives has a good mix of Objectives (overall outcomes), Projects (specific things
you’re going to do) and KPIs (measures of success). You might find that your financial
perspective has more KPIs than say your learning and growth perspective, and that’s
totally fine, but don’t let any perspective be completely devoid of any of these types of
goals! Here’s a quick reminder of the strategy model that we suggest using as a starting
point:
for your Business
Remember, the Balanced Scorecard is a Process, not a Simple Categorization Exercise
Whichever method you choose to implement the Balanced Scorecard, you need to ensure
that your goals have a sense of linear time-based progression that build towards the
delivery of your financial outcomes. That means that when you visualize your strategic
plan as a gantt chart, you need to ensure that your learning and growth, internal process
and customer goals are done first (and ideally in the order listed in this sentence) - and
that either your financial goals are towards the end of the gantt chart, or more likely that
they stretch across the entire time period of your strategic plan. This makes sense, since
the better you deliver against the first 3 perspectives, the better it will be for your financial
perspective.
for your Business
Implementing the Balanced Scorecard in Strategy Tracking
OK so we’ve covered the strategic planning side of implementing the Balanced Scorecard,
now let’s look at the other half of the picture - how to actually track and reporting against
your strategic progress using the balanced scorecard.
Regardless of which strategic planning method you’ve used, you’ll want to create a couple
of different reports to help you track your progress.
Create a Balanced Scorecard Dashboard
The best place to start to set up your strategic reporting for the Balanced Scorecard is to
create a Balanced Scorecard Dashboard. The dashboard can be pretty simple, but should
essentially show a score for each of your 4 perspectives, along with a summary of the
progress of key Objectives, Projects and KPIs that fit within that perspective. It should look
something like this:
for your Business
You’ll want to keep your dashboard fairly high level. If your strategy has many different
layers or connected plans, you might want to create a version of this Balanced Scorecard
dashboard for each of your individual strategic plans. In the video at the top of this page,
we go into the detail of the dashboard in much more depth, so be sure to check that out.
Create Balanced Scorecard Snapshots
Dashboards are great for giving you an ‘at a glance’ view of your progress in each of the
perspectives. However when it comes to the detail, you’ll need to change up to a different
type of report. We’d recommend setting up a more ‘tabular’ style of Snapshot report that
allows you to display additional information such as commentary and progress updates,
grouped by each perspective. Your report should look something like this:
This type of Snapshot report is great for running team meetings on a weekly or monthly
basis.
Balanced Scorecard Summary
If you’re liking the sound of the Balanced Scorecard and want to give it a try for your
business, you’ll seriously want to think about investing in a software tool to help you not
only plan your Balanced Scorecard strategy, but also implement it.
This is where platforms like Cascade really come into their own - and of course all of the
screenshots and videos in this guide came directly from the platform. If you’d like to find
out more about how Cascade can help you to implement the Balanced Scorecard, start a
free trial or jump on a demo with our team and we’ll walk you through everything you need
to know.
Ansoff’s Matrix (Overview)
The best strategic framework for organizations early-on in the formulation stage who are
looking to grow aggressively and with razor-sharp focus.
Ansoff’s Matrix is almost entirely a formulation tool. It requires you to make a firm decision
about whether you want your strategy to be:
• Market Development
• Market Penetration
• Product Development
• Diversification
Each of these strategies is different and each describes a high-level way of aligning your
organization. You should arguably be focused on one and one alone, especially in the early
stages of your organization’s maturity.
This makes it a great formulation tool, but less useful for execution - since almost all of
your goals will fall into one category, which won’t give you much insight when you overlay
the progress of your goals.
The Ansoff Matrix Explained
The Ansoff Matrix (also known as the Product / Market Expansion Grid) is a strategic
framework designed for organizations who want to move beyond ‘business as usual’.
It’s designed to help you figure out which of four strategic directions you should take
to successfully grow your business. The Ansoff Matrix was created by Igor Ansoff in
1957, and the matrix is as relevant today as it was over 50 years ago. That’s the sign of a
strategic framework that must have gotten something right!
We’re going to explore why the Ansoff Matrix is so useful, and how to implement it
effectively for your organization. Let’s start by taking a look at the matrix and the four key
quadrants that it encompasses:
Existing Products New Products

Existing Markets
MARKET PRODUCT
PENETRATION DEVELOPMENT
New Markets
MARKET
DIVERSIFICATION
DEVELOPMENT
The Ansoff Matrix - Four
Quadrants for Growth
The Ansoff Matrix- Market Development
This is all about selling more of your current product or service to a different or expanded
group of people. In other words, finding new groups of people to sell your product to. They
will have the same needs as your existing customers, but perhaps aren’t aware that your
product could help them.
Examples of strategies that would fit into this part of the matrix would be international
(geographic) expansion, or use of new sales channels such as online.
A great example of market development...
Coconut Water had been on sale in health stores for decades. More recently, several large
manufacturers decided to change how they marketed the product. They enlisted sports
stars and celebrities, positioning Coconut Water as the healthy alternative to sports drinks
such as Gatorade. Within a year, Coconut Water had grabbed nearly 6% of the global juice
market, from nowhere.
The Ansoff Matrix- Market Penetration

Market penetration entails trying to sell your current product to the same people, but in
larger quantities. For example, you may be more aggressive with your marketing but in the
same target groups. You may also offer incentives for people to buy more of your product
in exchange for a discount.
A great example of market penetration...
Have you ever wondered how and why Coca Cola is associated with Christmas?
The answer is because they decided to implement an aggressive strategy of market
penetration. They invested heavily in marketing to create a positive association between
the two. The target of the marketing effort being existing customers who already loved
Coke, and already loved Christmas. By linking the two, Coca Cola created a 13% revenue
increase linked directly to Christmas sales.
The Ansoff Matrix - Four
Quadrants for Growth
The Ansoff Matrix- Product Development
This is all about developing new products to sell to your current customer base. For
example, makers of sports shoes have aggressively developed products such as sports
clothing to sell to the same group of people who were originally just buying shoes.
A great example of product development...
McDonald’s seems to have done a pretty good job of weathering the changes in consumer
taste over the years. They’ve done this by supplementing their mainstream fast-food
products with new additions. The strategy was to appease customers who’ve grown
tired of high-fat junk food (but love the convenience/low cost that McDonald’s offers). A
great example is the McSalad, a completely different product from burgers and fries. The
Mcsalad debuted on the Maccas menu to stop an increasingly health-conscious customer
base from going elsewhere.
The Ansoff Matrix- Diversification

Diversification is arguably the riskiest of all 4 components. This quadrant involves selling
new products to new markets. The risk is clear in that you’ll likely have little knowledge
of either the product or the market. However, the possible gains in diversifying are often
large.
A great example of diversification...
Long ago, Apple was a brand that only appealed to serious graphic designers, and a certain
type of tech geek. Then came the iPod (and eventually the iPhone). These products were
actually very different from anything that had come before (from Apple or anyone else).
They were designed from day 1 to appeal to a totally different customer-base than had
previously been buying Apple products. This is probably the single best executed example
of new product + new customer the world has seen.
How to Implement The
Ansoff Matrix
OK, so now we know what the Ansoff Matrix is all about, and how powerful it can be in
helping organizations to grow their business. Let’s take a look at how exactly to implement
it.
Start by identifying your strengths...

It’s no secret that for the most part, playing to your strengths is a good starting point.
There are a range of tools you can use to help identify your strengths as an organization,
from SWOT to the more advanced SCOPE analysis techniques - so we won’t cover that
here. Ultimately, it’s about asking yourself critical questions such as:
What makes me different from my competitors?
Why do people buy from me instead of others?
What am I proudest of about my company?
Answering those questions should give you some insight as to which part of the Ansoff
Matrix to attack first. For example:
Companies who’s product is just average, but are great at making their marketing
campaigns stand out, should probably be looking at market penetration or even
development. Companies who have a proven track record of creating solid products
(though haven’t always been on point with their marketing strategy), are better suited to
implement a product development or diversification strategy.
Now determine your risk appetite...

OK, so just because you’re good at something, doesn’t mean you should stick to doing only
that. In-fact, the right move may be to push yourself a little harder - either because you see
a big opportunity, or even a big looming threat to your current industry.
How to Implement The
Ansoff Matrix
The more risk appetite you have, the further away from your strengths you might want to
push yourself. Generally speaking, the risk factors of the Ansoff Matrix look like this:
Figure out where you want or need to sit on that spectrum and use that to influence your
decision as to which quadrant to attack.
Finally, make a plan...

Now that you’ve chosen which part of the Ansoff Matrix you want to attack, it’s time to
make a plan. Start by creating a succinct vision statement that captures what you’re trying
to achieve. If you were Apple and were about to pursue the diversification strategy, you
might have had a vision statement somewhere along the lines of:
“To capture the hearts, minds (and wallets) of a new generation of computer geek, through
innovative technology that increases their access to pop culture staples such as music and
movies.”
(OK, so I made that up on the spot - it’s not an actual Apple vision statement, but you get
the idea!)
Once you’ve got your vision, the rest of your strategic plan should be much easier to
create. We’ve create a detailed guide on how to do just that here - and you’ll definitely want
to check out our own strategic platform Cascade when you get to this part of the journey.
Don’t be afraid to try creating plans for a few different quadrants of the Ansoff Matrix to
see which one suits you best!
So, What’s the Best Strategic
Framework for you?
Hopefully these explanations will help you to select the right strategic framework for your
needs. Remember, you may not even need a strategic framework if you find that none of
the above resonates - and that’s ok!
As always, feel free to reach out to the Cascade team if you are ready to implement!
Have You Seen Our Course?
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Our strategic planning course walks you through the entire process to develop a strategic
plan from scratch... and it’s FREE! Click the image below to get access!
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Document. This Document Is For Your Personal Use Only.

“Why did my organization use the Balanced Scorecard,

06 What is a Strategic Framework?

08 The Benefits of a Strategic Framework to Strategy

09 The Benefits of a Strategic Framework to Strategy

10 Choosing the Right Strategic Framework

12 McKinsey’s Strategic Horizons

38 The Balanced Scorecard

Popular strategic frameworks include the Balanced Scorecard, McKinsey’s Strategic

ORGANIZATIONAL BALANCED STAKEHOLDER

Let’s dive into each of our strategic frameworks in more detail...

Horizon 3: Create Genuinely New Business

The Three Horizons of Growth framework is an extremely versatile strategy framework,

Start with a deep understanding of your horizon 1

Your horizon 3 is what you would do if that were to happen

• How close are you to the 70 / 20 / 10 rule?

This approach is helpful for formulation, since it forces you to be razor-focused on

Your organization must become obsessed with understanding the

How would you measure Customer Intimacy?

To do this effectively, an organization needs to challenge itself in three specific ways:

Commercially - the ideas need to move through their due process

Relentlessly - such a product leader must be relentless in their pursuit

• Encouragement of innovation – Maintain a company culture that allows experimentation

How do you measure Product Leadership?

Dell is a perfect example of this principle. While Compaq computers concentrated on

The guiding principles for operational excellence revolve around:

• Efficient management of people – Developing a culture and training focused on efficient

How can you apply this framework to your business?

Cascade’s Value Discipline

Stakeholder Theory is a nice strategic framework that tends to be popular amongst

Stakeholder theory is based on the assumption that businesses can

• Higher productivity through employee satisfaction

• Increased mental health of the workforce through job satisfaction

And, on an entirely personal (and selfish) level:

Step 1: Define your stakeholders

Step 3: Understand your gaps

And I suppose this is really step 4: ‘Do something different’.

Internal Business Process

Learning and Growth

• It takes too much time to set up across your organization.

This approach to implementing the Balanced Scorecard is however fundamentally wrong.

The Balanced Scorecard is not a series of equally weighted perspectives. It is rather

Implementing the Balanced Scorecard in Strategic Planning

Method 1: Using Focus Areas

This Balanced Scorecard implementation methodology essentially involves orienting your

Method 2: Using ‘Goal Types’

This is a slightly more sophisticated way of implementing the Balanced Scorecard as it

Add Objectives, Projects and KPIs for each Perspective

Create a Balanced Scorecard Dashboard

Create Balanced Scorecard Snapshots