Strategy, then, is identifying and defining management’s desired relationships among the
four perspectives. Strategy translation, on the other hand, means specifying objectives,measures, targets, and initiatives for each perspective. The strategy translation process is
illustrated in Exhibit 13-5. Consider, for example, a company that wishes to pursue a
revenue growth strategy. For the financial perspective, the company may specify an objective
of growing revenues by introducing new products. The performance measure may
be the percentage of revenues from the sale of new products. The target or standard for
the coming year for the measure may be 20 percent. (That is, twenty percent of the total
revenues for the coming year must be from the sale of new products.) The initiative
describes how this is to be accomplished. The “how,” of course, involves the other three
perspectives. The customer segments, internal processes, and individual and organizational
capabilities that will permit the realization of the revenue growth objective must
now be identified. This illustrates the fact that the financial objectives serve as the focus
for the objectives, measures, and initiatives of the other three perspectives. It also illustrates
the need to carefully define the relationships among the four perspectives so that
strategy becomes visible and operational. However, before examining how these causal
relationships define and operationalize the strategy, we first need a better understanding
of the four perspectives, their objectives, and their measures