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Strategic Performance Management Leveraging and Measuring Your Intangible Value Drivers
Bernard Marr
In a sentence
A practical guide to designing and running Strategic Performance Management by mapping tangible and intangible value drivers, building meaningful indicators, and using them in an enabled learning environment rather than a command-and-control regime.
Bernard Marr argues that most organizations fail at performance management because they fall into three traps: an incomplete, one-sided view of strategy; measuring what is easy rather than what matters; and using measures to control people like machines. Strategic Performance Management offers an integrated alternative that unites market-based and resource-based strategic analysis into a 'value creation map' and 'value narrative,' then guides readers to design relevant performance indicators (not just measures), and to embed them in an 'enabled learning environment' where indicators inform learning, dialogue, and better strategic decisions. Rich with real-world case studies (DHL, Novo Nordisk, Fujitsu, Shell, TT Club, the UK Home Office) and templates for identifying value drivers, designing indicators, assessing risk, and evaluating mergers, the book shows how to move from management-by-numbers to management-by-insights and make strategy everyone's everyday job.
The four lenses
- Science
- Statistics
- Systems
- Strategy
Tags
The model
A causal framework in which strategic clarity (value creation mapping) and design levers (relevant indicators, enabled learning environment) shape psychological and behavioral states (shared understanding, trust, learning behaviour) that drive organizational outcomes (better decisions, value delivery, sustained performance), while resource architecture underpins core competencies and the stakeholder value proposition.
Value Creation Mappingdesign lever
The explicit visualization and narration of organizational strategy that links the stakeholder value proposition, core competencies, and the underlying tangible and intangible resources into a shared, communicable business model.
Intangible Resource Basecontextual condition
The stock of non-physical value drivers attributed to an organization, including human resources (skills, know-how), structural resources (culture, processes, intellectual property), and relational resources (reputation, customer and supplier relationships).
Core Competenciesbehavioral pattern
A distinctive combination of organizational resources and capabilities that is central to strategy and competitiveness, linked to the value proposition, difficult for competitors to imitate, and providing access to multiple markets.
Relevant Performance Indicatorsdesign lever
Meaningful indicators, aligned to strategic elements on the value creation map, that indicate levels of performance for resources, competencies, and output deliverables and enable challenging of strategic assumptions rather than merely measuring what is easy.
Command-and-Control Orientationcontextual condition
A managerial approach that uses measures to control behaviour, assign blame, and reward or punish against targets, treating people mechanistically and emphasizing compliance over learning.
Enabled Learning Environmentdesign lever
An organizational social context of trust, line-of-sight relationships, common purpose, mutual respect, and empowerment in which employees actively seek strategic insights, engage in dialogue, and are enabled to act on what they learn.
Shared Strategic Understandingpsychological state
The degree to which employees across the organization hold a common, explicit understanding of the strategic direction, value proposition, and how they contribute, creating a shared identity and sense of community.
Organizational Learning Behaviourbehavioral pattern
The behavioral pattern of using indicators to reflect, question, challenge and validate assumptions (single- and double-loop learning), engage in dialogue, and refine strategy rather than game measures.
Quality of Strategic Decisions and Insightsoutcome metric
The extent to which relevant indicators and learning translate into better-informed strategic decisions, tested assumptions, sound risk assessment, and effective evaluation of options such as mergers and acquisitions.
Value Delivery and Sustained Performanceoutcome metric
The ultimate outcome of delivering the stakeholder value proposition and achieving sustained organizational performance (e.g., customer and employee satisfaction, financial results, competitive advantage).
How they connect
- intangible resource base → predicts core competencies
- core competencies → predicts value delivery performance
- value creation mapping → predicts shared strategic understanding
- value creation mapping → influences relevant performance indicators
- relevant performance indicators → predicts organizational learning behaviour
- command and control orientation − moderates organizational learning behaviour
- enabled learning environment → predicts organizational learning behaviour
- shared strategic understanding → predicts organizational learning behaviour
- organizational learning behaviour → predicts quality strategic decisions
- quality strategic decisions → predicts value delivery performance
- shared strategic understanding → mediates quality strategic decisions
The story
The reader A senior executive or manager who wants to genuinely improve organizational performance by understanding and leveraging what really drives value.
External problem
The organization measures too many irrelevant things, has a one-sided or unclear strategy, and cannot see how its tangible and intangible value drivers create value.
Internal problem
Managers feel frustrated that record numbers of measures yield few useful insights, and that performance management is an administrative burden causing gaming rather than progress.
Philosophical problem
It is just plain wrong to treat people like machines and manage by backward-looking numbers when success in the knowledge age depends on learning, insight, and engaging everyone in strategy.
The plan
- Clarify the strategic boundary conditions (purpose, values, visionary goals).
- Analyse the external environment to define the stakeholder value proposition.
- Analyse internal resources and competencies to understand what you can deliver.
- Bring both together in a value creation map and value narrative.
- Design meaningful, relevant performance indicators for each strategic element.
- Create an enabled learning environment and redesign performance review meetings.
- Use the map and indicators to test assumptions, assess risk, and evaluate M&A—supported by appropriate software.
Success
- A clear, shared understanding of strategy where performance becomes everyone's everyday job.
- Relevant indicators that produce real management insights and better decisions.
- A performance-driven culture with trust, dialogue, learning, and continuous improvement.
- The ability to challenge assumptions, assess risk, and evaluate strategic options with confidence.
At stake
- Falling into the strategy, measurement, and management traps.
- Dysfunctional behaviour, gaming of measures, and eroded collaboration.
- Loss of key people and deteriorating customer and employee satisfaction.
- Wasted investment in measurement and software with no improvement in performance.
Questions this book answers
- Why do traditional performance management initiatives produce dysfunctional behaviour and poor results?
- How can organizations identify, visualize, and describe their tangible and intangible value drivers?
- How do you design meaningful performance indicators rather than measuring what is easy?
- What are the limits of measurement in a social/organizational context, and what follows for how measures should be used?
- How do you create an enabled learning environment where indicators drive learning and decisions instead of control?
Glossary
- Value Creation Mapping
- The practice of visualizing and narrating organizational strategy by linking the stakeholder value proposition, core competencies, and underlying tangible and intangible resources into one shared business model.
- Intangible Resource Base
- The stock of human, structural, and relational non-physical value drivers attributed to the organization that support its competencies.
- Core Competencies
- Distinctive, hard-to-imitate combinations of resources and capabilities central to strategy and linked to the value proposition.
- Relevant Performance Indicators
- Meaningful indicators aligned to strategic elements that indicate performance levels and enable challenging of strategic assumptions.
- Command-and-Control Orientation
- A managerial climate that uses measures to control, reward, and punish, emphasizing compliance and blame over learning.
- Enabled Learning Environment
- A social context of trust, common purpose, and empowerment in which people seek insights, dialogue, and are enabled to act.
- Shared Strategic Understanding
- The extent to which employees hold a common, explicit understanding of strategy and how they contribute to it.
- Organizational Learning Behaviour
- The behavioral pattern of using indicators to reflect, question, and validate assumptions via single- and double-loop learning rather than gaming measures.