Strategic Management Maturity Model (SMMM)

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Framework Primer
Strategic Management Maturity
Model
TM
(SMMM)
Presentation created by
Culture and Values
Strategic Thinking and
Planning
Strategic Alignment
1
2
3
4
Performance Measurement
Performance Management
Process Improvement
Leadership
Sustainability of Strategic
Management
5
6
7
8
STAGE 2
Reactive
STAGE 3
Structured
and Proactive
STAGE 4
Managed and
Focused
STAGE 5
Continuous
Improvement
STAGE 1
Ad Hoc and
Static

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Contents
Overview
Stages of Strategic Management Maturity
Dimensions of Strategic Management
Templates
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Presentation Overview
SMMM can be leveraged to develop benchmarks across organizations in order to identify
leading practices.
The Strategic Management Maturity ModelTM (SMMM) provides a
framework for assessing and improving our Strategic Management system
Strategic Management provides the foundation to a high performing organization. But, how good are
our organization’s Strategic Management system and processes?
The Strategic Management Maturity ModelTM (SMMM), developed by the Balanced Scorecard Institute,
provides a framework for assessing and improving our Strategic Management system and processes.
It allows us to assess the maturity of our approach to Strategic Management on a 5-stage scale
across 8 dimensions of Strategic Management:
The 5 stages of each dimension are defined as:
1 5Leadership Performance Measurement
2 6Culture and Values Performance Management
3 Strategic Thinking and Planning 7 Process Improvement
4 Strategic Alignment 8 Sustainability of Strategic Management
1 4Ad Hoc and Static Managed and Focused
2 5Reactive Continuous Improvement
3 Structured and Proactive

Management seeks to answer 2 questions—Are we doing things right?
And are doing the right things?
Strategic Management Overview
Strategic Management and Operational Management are complementary—bot must be
assessed to understand our total management capabilities.
All management seeks to answer 2 core questions:
This is addressed
through Operational
Management.
Operational Management frameworks
include Total Quality Management, Six
Sigma, Business Process Engineering,
among many other Lean Six Sigma tools.
Are we doing
things right?1
This is addressed
through Strategic
Management.
The Strategic Management Maturity
ModelTM (SMMM) is a framework developed
by the Balanced Scorecard Institute focused
on evaluating and improving our Strategic
Management system and processes.
Are we doing the
right things?2
1 Assessing where our
organization stands in terms
of Strategic Management.
2 Monitoring progress in
improving maturity of
Strategic Management
3 Benchmarking across organizations (or
departments within our organization) to
identify best practices in Strategic
Management.
SMMM can be leveraged to achieve 3 primary objectives:

SMMM evaluates performance across 8 Dimensions of Strategic
Management
Source: The Strategic Management Maturity ModelTM, Balanced Score Institute, 2010
8 Dimensions of Strategic Management
The Strategic Management Maturity ModelTM evaluates performance across 8 Dimensions of Strategic
Management:
Leadership
Culture and Values
Strategic Thinking
and Planning
STRATEGIC
MANAGEMENT
Strategic Alignment
1
2
3
4
Performance
Measurement
Performance
Management
Process
Improvement
Sustainability of
Strategic
Management
5
6
7
8

Here are good books that discuss effective approaches to Strategic
Management
Strategic Management References
This list of suggested reading was compiled by the Balanced Scorecard Institute.
H. Rohm, Is There Any Strategy in Your Strategic Plan? (Balanced Scorecard Institute, 2008)
R. S. Kaplan and D. P. Norton, The Strategy-Focused Organization, (Harvard Business School Press,
2001).
R. S. Kaplan and D. P. Norton, The Execution Premium, (Harvard Business School Press, 2008).
J. P. Kotter, Leading Change, (Harvard Business School Press, 1996).
M. G. Brown, Winning Score: How to Design and Implement Organizational Scorecards, (Productivity
Press, 2000)
J. Fitz-Enz, Benchmarking Staff Performance, (Jossey-Bass, 1993).
L. Bossidy and R. Charan, Execution: The Discipline of Getting Things Done, (Crown Business, 2002).
W. Chan Kim and Renée Mauborgne, Blue Ocean Strategy, (Harvard Business Press; 2005).

Contents
Overview
Templates

For each Dimension of Strategic Management, there are 5 defining
stages of maturity
5 Stages of Strategic Management Maturity
We use the SMMM to evaluate our organization by scoring the level of performance on
each of the 5 levels of strategic management maturity across each dimension.
For each of these 8 dimensions, there are 5 stages of Strategic Management Maturity. This array of 40
dimension-stage combinations comprise the full SMMM framework. The 5 stage are defined with increasing
maturity, from Stage 1 of Ad Hoc and Static to eventually the most mature state: Stage 5, Continuous
Improvement:
Culture and Values
Planning
Strategic Alignment
1
2
3
4
Process Improvement
Leadership
Management
5
6
7
8
STAGE 2
Reactive
STAGE 3
Structured
and Proactive
STAGE 4
Managed and
Focused
STAGE 5
Continuous
Improvement
STAGE 1
Ad Hoc and
Static

At the second stage, some elements of effective
Strategic Planning and Performance Management are
beginning to be applied.
Application is inconsistent and typically with poor results.
Planning activities are not rigorous and typically done in
a reactionary fashion
At the earliest stage of Ad Hoc and Static, the organization
has no formal Strategic Planning or Management processes …
SMMM Stages (1/2)
STAGE 2
Reactive
STAGE 3
Structured and
Proactive
STAGE 1
Ad Hoc and Static
At this nascent stage, the organization does not
do any formal Strategic Planning or Management.
The company tends to plan only on the tactical or
operational level in an ad hoc and uncontrolled
manner.
Management spends most of their energies
addressing operating issues and “putting out
fires.” They don’t address long-term strategy.
At this point, the organization adopts formal
structures and processes in place, so it is
comprehensively and proactively engaging in
Strategic Planning and Management.
These activities occur on a regular basis and there
is some tangible improvement over time.
Measurements are align with the corporate strategy

… By stage 5, Continuous Improvement, the organization has
embodied Strategic Management Excellence within its culture
SMMM Stages (2/2)
STAGE 5
Continuous
Improvement
STAGE 4
Managed and
Focused
Now, strategy drives focus and the decision
making process for the organization.
Standards and methods implemented for Strategy
Management are used across the full organization.
Management formally engage employees in this
process. This helps foster a culture where
employees are measured and held accountable to
these performance metrics
At this most mature stage, Strategic Planning
and Management Excellence are embedded
within the culture of the organization.
Strategic Planning and Management processes
are also continuously improved in a formal sense.
Excellence in Strategic Management becomes a
foundational driver to the organization’s
competitive advantage and performance success
In the final stage, our organization continues to study the Strategic Planning and
Management processes so that they can be continuously adapted and further improved.

Contents
Overview
Templates

As Leadership matures, it evolves from a “command and control” style to
a decentralized, team-based culture
Strategic Management Dimension – Leadership
OVERVIEW
Effective Strategic Management begins with good Leadership. Strategic Management leads to increased employee
engagement and satisfaction; and less of a “command and control” management style. Good leaders do the following:
Set a clear and consistent vision for the organization
Prepare the organization proactively
Are visible and engaged
Embody the values, ethics, and politics put fort
Don’t micromanage—place trust in employees
Work alongside staff
Leaders dictate but
gather feedback
sporadically
Leaders engage with
direct reports only, but
do model desired
behaviors and values
Leaders empower
many employees
through on going
engagement
Leaders & employees
fully engage in a
continuous dialog
based on a team-based
culture
Leaders dictate/
command & control;
otherwise disengaged
STAGE 2 STAGE 3 STAGE 4 STAGE 5STAGE 1
Reactive Structured and
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

As Strategic Management matures, Vision and Values become defined,
communicated, understood, and ultimately integrated into the culture
Strategic Management Dimension – Culture and Values
OVERVIEW
This dimension is the culture and values inside the organization. It also addresses the shared understanding and
agreement by all employees of the culture and values. A mature workforce exhibits the following Culture and Values:
Thoughtful applications of Change Management principles by
the Leadership
Strong feeling of ownership for the Vision and Values
High degree of participation in shaping the corporate culture
Strong level of trust, transparency, and freedom to
communicate with honesty
High degree of flexibility and willingness to change to
align to new strategic priorities
High level of awareness of stated values and policies
Vision & Values
published, but not lived
Vision & Values
communicated &
understood
Vision & Values
collaboratively
developed
Vision & Values fully
integrated into
organization culture
Vision & values
undefined or not
shared
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

In the beginning, there is no Strategic Planning—eventually, planning
becomes a continuously improved upon process
Strategic Management Dimension – Strategic Thinking and Planning
OVERVIEW
It may go without saying, effective Strategic Development requires Strategic Thinking. This type of thinking requires
several capabilities:
Ability to use consistent definitions of planning terms and to
understand their distinctions
Awareness of the distinctions between project planning and
Strategic Planning
Ability to discuss items in the strategy plan at the
appropriate “strategic altitude”
Awareness of the dynamic system effects in the
organization (e.g. delays, feedback, approvals)
Availability to new ideas and encouragement of
innovation
Openness of the Strategic Planning process to a multi-
function team comprised of employees from varying
ranks
Willingness to consider alternate strategies and scenarios
Linkage of Strategic Planning to Budgeting
Ability to communicate succinctly and clearly
Strategic planning is
the responsibility of a
small team and
dictated to the
organization
A structure and open
planning process
involves people
throughout the
organization every
couple of years
Plans are developed
and revised regularly
by trained, cross-
functional planning
teams
Strategy drives critical
organizational
decisions and a
continuous
improvement planning
process is maintained
No strategic planning
occurs within the
organization; no goals
defined
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

As the organization matures, we attain more and more Strategic
Alignment
Strategic Management Dimension – Strategic Alignment
OVERVIEW
Strategic Alignment is the degree to which our organization’s employees and resources are focused on the strategy.
The opposite of alignment is chaos, a state where managers, programs, and projects are working towards different
goals and there is a lack of common vision. This leads to wasted energies, delays, conflicts, and confusion, which
results in demotivation of employees across the organization. Strategic Alignment measures the degree to which:
Employees at all levels are motivated by a shared vision and strategy
Employees understand that supporting the strategy is their job and responsibility
Employees are self-motivated (not merely motivated by compliance to rules)
Customer needs and
feedback start to
influence more aligned
decision making
Employees know their
customer sand align
strategy to those needs
Vision, Customer
needs, strategy, and
employee reward and
recognition systems
are cascaded and
aligned
All structures and
systems are aligned
with strategy, and
organizational
alignment is
continuously improved
Work is narrowly
focused based on
organization structure,
with little customer
input
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

As Performance Measurement matures, we go from no data to
measurements being comprehensively collected and utilized
Strategic Management Dimension – Performance Measurement
OVERVIEW
Strategic Performance Measurements or Metrics are aligned to the Strategic Plan. They are tied to strategic outcomes,
which in turn are tied to the vision of the organization. Performance Measurement also includes an evaluation of the
utilization of technology in management performance data. In modern organizations, this technology needs to grow
beyond Excel spreadsheets, which are difficult to maintain data consistency and accuracy. Good Strategic
Performance Measurements are characterized by:
Metrics derived from and aligned to the strategy
Metrics that focus on strategic outcomes and results
Metrics that are measured and reported often enough to
drive decision making
Metrics beyond the individual level—e.g. team, organization
performance metrics
A balanced set of metrics beyond financial (e.g. customer,
learning, innovation, process)
Performance data
collected routinely, but
are mostly
operationally focused
Strategic performance
measures are
collected, covering
most strategic
objectives
Strategic measures are
broadly used to
improve focus &
performance and
inform budget
decisions
Measurements
comprehensively used
and routinely revised
based on continuous
improvement
No data, or only ad hoc
performance measures
are collected
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

At our most mature stage, Performance Management is embedded
in our culture
Strategic Management Dimension – Performance Management
OVERVIEW
Performance Management refers to the degree to which performance metrics are available for and leveraged in decision
making. Good Performance Management is marked by the following characteristics:
Recognition of the organization as an evolving, dynamic system
Use of feedback loops—so managers see the results of their decisions
Managers have the power to change things based on timely reporting
Strategic Performance Measures are available to test the strategy
Management has placed the entire organization in a “learning loop,” so that its vision can be validated
The organization is learning how to improve customer satisfaction and the organization
Performance reviews
required but not taken
seriously; no
accountability for
performance exists
Measures are assigned
owners and
performance is
managed at the
organizational and
employee level
Measurement owners
are held accountable
and performance is
managed at all levels
Organizational culture
is measurement and
accountability focused;
decisions are evidence-
based
No emphasis on using
performance as a
criterion to manage the
organization
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

Process evolve from organic and ad hoc to fully documented, tracked,
and continuously improved upon
Strategic Management Dimension – Process Improvement
OVERVIEW
Through Strategic Management, we must be able to accurately determine which business processes are in most need
of improvement. This requires input from the strategy, which governs resource allocation and planning improvements
towards the most strategically important processes. Planning improvements include an assessment of:
The organization’s knowledge about its strategically important work processes
How well these processes are being improved, updated, and documented
How efficiently these processes perform against internal and industry benchmarks
Skills, leading practices, and technologies use to improve process quality and efficiency
Existence of business continuity and disaster recovery plans
Knowledge of the organization’s core competencies and how well they are leveraged for the processes
A few processes
documented, and
process improvement
models (TQM, Lean Six
Sigma, etc.) introduced
All key processes are
identified and
documented, and
strategy guides
successful process
improvement initiative
and improvements
All key processes are
tracked and improved
on a continuous basis
and new process
improvement ideas are
accepted
Employees are
empowered and
trained, and a formal
process exists for
improving process
management
Processes are
undocumented and ad
hoc with evident
duplication and delays
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

Our end goal is for a sustainable Strategic Management system in place
Strategic Management Dimension – Sustainability of Strategic Management
OVERVIEW
The end goal is for the Strategic Management system in place to be sustainable. This places the organization on a
course of continuous learning and improvement. We can achieve sustainability of Strategic Management with the
following elements:
How well our organization is maintaining its focus on its strategic vision, plans, and initiatives
Resources, systems, and communication activities are in place to maintain the momentum of desired change
Sense of urgency among the employees
Employee reward and recognition systems
Degree to which Strategic Management has been institutionalized
Presence of “champions” whose role is to keep employees informed about strategic priorities and target performance levels
Strategy “champions”
identified
Formal organization
structure in place to
maintain focus on
strategy
Organization has an
“Office of Strategy
Management” or
equivalent
Strategic thinking and
management are
embedded in the
culture of the
organization
Lack of structure and
champions lead to
short-term focus on
tasks
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static

Contents
Overview
Templates

Insert headline
Source: The Strategic Management Maturity ModelTM, Balanced Score Institute, 2010
8 Dimensions of Strategic Management – TEMPLATE
Leadership
Culture and Values
Strategic Thinking
and Planning
STRATEGIC
MANAGEMENT
Strategic Alignment
1
2
3
4
Performance
Measurement
Performance
Management
Process
Improvement
Sustainability of
Strategic
Management
5
6
7
8
Insert bumper.

Insert headline
Dimensions of Strategic Management and Stages of SMMM – TEMPLATE
Insert bumper.
Culture and Values
Planning
Strategic Alignment
1
2
3
4
Process Improvement
Leadership
Management
5
6
7
8
STAGE 2
Reactive
STAGE 3
Structured
and
Proactive
STAGE 4
Managed
and
Focused
STAGE 5
Continuous
Improvement
STAGE 1
Ad Hoc and
Static

Insert headline
Stages of SMMM – TEMPLATE
Insert bumper.
STAGE 2
Reactive
STAGE 3
Structured
and
Proactive
STAGE 4
Managed
and
Focused
STAGE 5
Continuous
Improvement
STAGE 1
Ad Hoc and
Static

Insert headline
Stages of SMMM – TEMPLATE ALTERNATE
Insert bumper.
Proactive
Managed and
Focused
Continuous
Improvement
Ad Hoc and
Static
• Filler text, filler text,
filler text, filler text

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documents can range from Business
Frameworks to Financial Models to
PowerPoint Templates.
Flevy was founded under the principle that
companies waste a lot of time and money
recreating the same foundational business
documents. Our vision is for Flevy to
become a comprehensive knowledge base
of business documents. All organizations,
from startups to large enterprises, can use
Flevy— whether it's to jumpstart projects, to
find reference or comparison materials, or
just to learn.
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Please contact us with any questions you may have
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