Modeling Cause and Effect Relationships of Strategy Map Using DEMATEL Technique

The Balanced Scorecard is widely adopted performance management framework first introduced in the early 1990s. More recently it has been proposed as the basic for a strategic management system. Strategy mapping is the most important task in building a Balanced Scorecard system. Strategy mapping is the process for visually making cause and effect relationships between all possible strategic objectives in an organization. The process for building and constructing a strategy map is a human centric activity which could be considered as the combination and integration of all knowledge and preferences of the managerial boards. From the view point of strategic decision making in an organization, the process for building a strategy map, could be viewed in a general body of a unified group decision making context. If we see the strategy map, as a structural modeling framework for making the cause and effect relationships among the strategic objectives, it is possible to deploy Decision Making Trial and Evaluation Laboratory (DEMATEL) as a framework for structural modeling approach subject to the problem. The DEMATEL method gathers collective knowledge to capture the causal relationships between strategic criteria. The model is especially practical and useful for visualizing the structure of complicated causal relationships with matrices or digraphs. In this process, the integrated structure can be offered for the macro level balanced scorecard and in addition to the mathematic modeling of cause and effect relationships, a decision support system could be presented in the execution frame that may increase the efficiency of the balanced scorecard management system.