Most organizations struggle to make their strategy work for them, not against them. Leadership teams invest time defining clear goals, yet months later, progress feels disconnected. Teams stay busy, but outcomes don’t reflect the original intent. The issue rarely lies in the strategy itself; instead, it emerges in the space between planning and execution, where goals are expected to translate into action but often don’t.This gap forms because strategy is typically defined at the top but not effectively translated downward. As it moves across departments and teams, it loses clarity, context, precision, and urgency. What begins as a focused direction becomes fragmented efforts, with each part of the organization interpreting priorities according to its specific needs.
Why Employees Feel Disconnected from Strategy
A significant portion of employees don’t fully understand their company’s strategy or how their work contributes to it. This lack of clarity creates a ripple effect. People default to what they believe matters, which often leads to redundant efforts or misplaced priorities. Without a clear line of sight between daily tasks and long-term goals, work becomes activity-driven rather than outcome-driven.The activity becomes the outcome in and of itself.This disconnect also impacts motivation. When individuals can’t see how their contributions fit into a larger purpose, engagement drops, and whilst teams may still perform their roles as expected, without alignment, their efforts rarely compound into little more than droll progress at best.
The Cost of Misalignment in Daily Operations
Misalignment is not always obvious at first. It shows up subtly in duplicated work or conflicting priorities that beget delays caused by constant clarification and reclarification. Over time, these small inefficiencies accumulate into larger organizational challenges. Departments begin optimizing for their own success metrics, often at the expense of broader company goals.Instead of moving in one direction, the organization pulls itself apart. Meetings increase, coordination becomes more complex, and leadership spends more time realigning than advancing strategy. The result is a system where effort is high, but impact remains limited.
Understanding Cascading Goals and Why They Matter
What Cascading Goals Actually Do
Cascading goals provide a structured way to connect high-level strategy with everyday work. Rather than keeping objectives at the leadership level, they break them down into actionable goals for departments, teams, and individuals. This process ensures that strategic priorities don’t remain abstract but become part of daily execution.The purpose is not simply to distribute goals downward but to create alignment across the organization. Each level interprets and translates the strategy in a way that fits its role, while still maintaining a clear connection to the bigger picture.
How the Cascade Works in Practice
The cascading process typically follows a logical flow. Leadership defines a small set of clear, measurable strategic goals. Departments then translate these into functional objectives based on how they contribute to those goals. Teams further refine these into specific KPIs they can control, and managers connect those KPIs to individual responsibilities.When this process is done correctly, every layer of the organization understands its role in achieving the overall strategy. There is no ambiguity about priorities, and each action contributes to a shared outcome.
Why Alignment Depends on More Than Structure
While the structure of cascading is important, alignment ultimately depends on communication and transparency. Employees need to understand not just what they are doing, but why it matters. Without this context, even well-defined goals can lose their impact.Effective cascading also requires two-way communication. Teams must be able to provide feedback, highlight constraints, rearrange objectives, and adapt goals when necessary. This balance between direction and flexibility is what turns cascading from a rigid system into a practical one.
Where Cascading Breaks Down (and What Causes It)
Misaligned KPIs and Conflicting Priorities
One of the most common issues in organizations is misaligned KPIs. Teams often define success based on what they can measure easily, rather than what supports the overall strategy. This leads to situations in which different departments work toward goals that unintentionally conflict.A company might aim to improve customer experience, while individual teams focus on speed, cost reduction, or output volume. Each goal may seem valid in isolation, but without alignment, they create friction instead of progress.
Silos, Ownership Gaps, and Communication Failures
Siloed thinking emerges when departments operate without visibility into each other’s goals. This lack of coordination leads to duplicated efforts and delayed outcomes. At the same time, unclear ownership creates confusion about who is responsible for driving specific results.Communication plays a central role in both of these challenges. When strategic goals are inconsistently reinforced or not clearly explained, teams are left to interpret them on their own. This results in fragmented execution and ongoing misalignment.
Overcomplication and Lack of Follow-Through
Another common breakdown occurs when organizations overcomplicate their cascading systems. Too many layers create confusion rather than clarity. Employees struggle to prioritize, and focus becomes diluted.Even when goals are well defined, they often fail due to a lack of follow-through. Without regular reviews, audits, updates, analyses, and adjustments, alignment weakens over time. Strategy becomes static, while the business environment continues to change.
Building Alignment Through Effective Cascading
Keeping Goals Focused and Visible
Effective cascading starts with simplicity. Organizations that limit their strategic goals to a small, focused set are more likely to maintain alignment. Clear goals make it easier for teams to understand priorities and translate them into action.Visibility is equally important. When goals are accessible through shared dashboards or centralized systems, alignment becomes part of daily work. People are more likely to stay focused when they can see how their efforts connect to broader objectives.
Creating Accountability and Continuous Alignment
Alignment is not achieved solely through goal-setting. It requires ongoing management. Regular performance reviews and feedback loops help ensure that goals remain relevant and achievable. These moments of reflection allow teams to identify misalignment early and adjust accordingly.Clear ownership also strengthens accountability. When individuals understand their responsibilities and how they contribute to team outcomes, execution becomes more consistent. Accountability shifts from being enforced to being naturally embedded in the system.
Balancing Structure with Flexibility
While cascading provides structure, it should not limit adaptability. Organizations need to remain flexible as priorities evolve. This means allowing teams to adjust goals, refine KPIs, and respond to new challenges without losing alignment with the overall strategy.The most effective systems combine structured goal-setting with continuous feedback and collaboration. This approach ensures that alignment is maintained, even as conditions change.
Final Thoughts
Organizations rarely fail because of poor strategy. More often, they fail because the strategy never fully connects to execution. Without alignment, even the best plans remain theoretical, while teams continue working without a shared direction.Cascading goals address this challenge by creating a clear link between high-level objectives and everyday actions. They provide structure, improve visibility, and help organizations move as a cohesive system rather than a collection of independent parts.When alignment is achieved, the difference is noticeable. Work becomes more focused, collaboration improves, processes interlink, and progress becomes measurable. Strategy stops being something discussed in meetings and starts becoming something that actively drives results.
In the end, cascading is not just a process. It is a way of ensuring that every effort within an organization contributes to a common purpose.
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The balanced scorecard (BSC) is a widely used performance measurement framework for strategic planning. It is so popular, in fact, that The KPI Institute’s latest State of Strategy Management Practice report found that 40% of respondents from Middle Eastern companies were using it. Why is that the case? It’s likely in the name—the BSC offers a balanced perspective of a company’s performance, focusing not just on financial gains but the various aspects of value creation as well. This enables companies who use it to establish sustainable business practices that can meet long-term goals without sacrificing short-term improvements.
What Is the BSC?
In 1992, Robert Kaplan and David Norton dreamed of a better way. Aware of the limitations of traditional practices that focused solely on financial indicators such as return on investment (ROI) to measure a company’s performance, the two designed a tool that incorporated non-financial variables to paint a more holistic, comprehensive picture. Thus, the balanced scorecard was born.
The BSC was further refined by connecting performance metrics directly to strategy, which marked a formal link between strategic goals and performance measurement. In 1996, it became a performance management system (PMS) that effectively integrated the various crucial aspects of an organization—i.e. strategic processes, resource allocation, budgeting and planning, goal setting, and employee learning.
By 2001, the BSC had outgrown its original form, no longer seen as a mere management tool but instead as an all-encompassing strategic management and control system. The BSC has continued to evolve alongside the ever-changing priorities of the business world. In 2021, many companies began integrating environmental and social dimensions into their BSCs to reflect their triple bottom line strategies.
Read More >> The Balanced Scorecard Approach: Performance Management at the Departmental Level
The Four Perspectives
The BSC gives managers a view of the business from four crucial perspectives. Each perspective deals with an integral aspect of the organization and answers a specific question:
Customer Perspective: How Do Customers See Us?
Companies typically have a mission statement that encapsulates how they interact with customers. For example, e-commerce platform Etsy’s mission statement is “Keep Commerce Human.” This sentiment informs the way the company does business, which places importance on leaving a positive economic, social, and ecological impact.
The BSC holds companies accountable to their mission statements by translating them into specific measures that must be followed. For Etsy, one aspect to consider would be the diversity of its workforce, which falls under social impact. To address this, the company has taken measures such as increasing the presence of underrepresented communities in its seller community by interviewing candidates from those backgrounds. This has enabled the company to stay true to its mission and show customers that it walks the talk.
Internal Perspective: What Must We Excel At?
Balance is the primary focus of the BSC—it’s in the name, after all. Thus, the framework doesn’t only take into account the way customers perceive the company, but it also considers what the latter does to shape this perception. This is composed of the various operational and organizational processes that drive the company.
By giving managers an internal perspective, they can identify, track, and measure the processes that yield the most benefits and close the gaps on the ones that fall short.
Learning and Growth Perspective: Can We Continue to Improve and Create Value?
The business landscape is constantly shifting, and in order to keep pace with its changes, businesses must consistently learn and innovate. That is the importance of this perspective, which states that a company’s value hinges on its ability to improve. In any industry, competition can be fierce, which means companies must always find new ways to stand out.
Financial Perspective: How Do We Look to Shareholders?
Among the four perspectives, this is perhaps the most straightforward. Put simply, it indicates if a company is profitable. Although financial performance is no longer the end-all, be-all measure of a company’s success, it still plays a crucial role in determining whether a company is simply surviving or thriving. Shareholders understandably value profitability, and they won’t keep investing in a company that doesn’t produce ROI.
The BSC is by nature a holistic framework, meaning each part is interconnected to the others. This is why it’s important to take a balanced (pun intended) approach when considering the four perspectives. If one side is prioritized over the others, it could lead to the formation or widening of inefficiency gaps that impede business growth and success.
Read More >> How To Use a Balanced Scorecard in a Board’s Performance Evaluation
Benefits of the BSC
As previously mentioned, the BSC is quite popular. This is due to the myriad of benefits that it brings to organizations that use it wisely. The most obvious benefits of the BSC are twofold. First, it consolidates the seemingly disparate aspects of a business in a single report, leading to increased efficiency in performance reporting and measurement as well as faster decision-making. Second, the BSC helps mitigate suboptimization by making managers consider the entirety of the company’s operational measures, demonstrating whether one objective was achieved at the cost of another.
A more concrete example of the BSC benefiting companies can be seen in how Apple uses the framework. By shifting its focus from innovating its products to also paying mind to customer satisfaction by establishing it as one of the company’s core tenets, the tech giant was able to improve its already stellar reputation by catering to its customers’ desires. Apple also values core competencies, employee commitment and alignment, market share, and shareholder value. Together, these indicators make up the metrics of their BSC.
World-renowned electronic company Philips is also known for its use of the BSC, using a bespoke version of the framework to fit its organizational needs. The company’s focus is on its employees, and it uses the BSC to ensure that each member of its workforce has a clear understanding of the company’s strategic policies and long-term vision.
What Does the Future Hold?
There must be a stronger emphasis on customization as companies realize that there is no such thing as a one-size-fits-all approach to performance management. This aligns with the proliferation of new advancements in artificial intelligence (AI) and machine learning (ML), technologies that must be integrated into the BSC lest the framework fall behind the ever-shifting realities of the business world. Regardless of the future, the BSC appears poised to remain a vital tool for companies of all sizes and in all industries.
Interested in learning more about the BSC? Browse our articles here.
Khalid G. Alharbi boasts over 20 years of experience in partnering with business unit executives to develop strategic plans, direction, market analysis, partnership, growth guide, and operation excellency. He leads large and complex projects to achieve key business objectives and promote digital transformation. He is pursuing a career in engineering, project management, sales and strategy planning. In this interview with Performance Magazine, he shares the highlights and insights of his career, providing valuable glimpses into his journey and accomplishments.
Would you tell us more about your educational and professional background? How did your previous experiences lead you to your current position?
I started as a telecom operation engineer working in the field and gradually moved to telecom planning. This gives me a full insight into the value chain of my profession. Then, I moved to the project management field as a Certified Project Management Professional (PMP) working in 2030 Vision programs.
After that, I went into the business development and sales field, looking for more opportunities based on my company’s strategic direction utilizing the skills in planning and project management I acquired from my previous work. Finally, I worked directly in formulating, implementing and measuring the performance of different strategies since 2018.
What are your main responsibilities and goals in your current role?
My major responsibilities as the Strategy and Policy – Acting General Manager are overseeing the sector’s strategy formulation, implementation and monitoring, directing research and statistical studies, including the standard development and licensing process while ensuring compliance with overall cultural strategies, policies, and standards.
Please take us through your daily job routine. Could you describe in detail your activities and work hours? You may specify certain areas of your job, such as your work arrangement (remote, on-site or hybrid) and the stakeholders you frequently contact or meet with.
My daily activities and work hours are spent monitoring the team tasks and responsibilities toward the strategic direction while conducting the coaching sessions. On top of that, I review indicators and matrices achieved looking for improvement.
Do you think that strategy and performance management in the public sector is different from that in the private sector? How?
Yes, by changing the targeted customer, including beneficiary and strategic direction. For example, the strategic direction in the public sector often focuses on the final beneficiary (citizens, residents and other government sectors) and the services provided to them. Moreover, the public sector focuses on measuring beneficiary satisfaction, improving service quality, sustaining provision, and reducing the sector’s burden in service delivery.
As for the private sector, the focus is on return on investment, as well as ensuring cash flows and the effectiveness of operational processes to reduce expenses.
What are the main achievements you are proud of thus far during your time working in strategy and performance management in the public sector?
So far, the main achievement I am proud of is my participation in formulating and implementing two strategies in the public sector.
What are the main challenges that you face working in strategy and performance management in the public sector? When faced with such challenges, what do you do?
One of the main challenges that I face working instrategy and performance management in the public sector is the shortage of manpower which leads to distraction.
For the future of your career, do you intend to keep on working in the public sector, switch to the private sector, or does the sector not really matter to you? Why?
Recently, the public sector has closely aligned with the private sector in terms of social and economic impact. This has led to a strategic shift, prompting me to consider either public or private.
If someone is looking to work in strategy and performance management in the public sector one day, what skills, knowledge and experience would you advise them to acquire?
From my point of view, to excel in strategic work and stand out, one must master employee management, ensuring subordinates adhere to policies and procedures while also possessing deep strategic thinking, maximizing gains, building strong relationships, and gaining trust to effectively implement required tasks.
In addition to analytical skills, data linking, project management, and financial planning, one should also possess the ability to set standards, develop policies, and master persuasive storytelling.
Khalid G. Alharbi will delve deeper into his insights on performance management in the public sector in the upcoming government edition of Performance Magazine. For updates on the publication release, please follow The KPI Institute’s LinkedIn page.
A hundred billion tons of materials enter the global economy every year. Only 8.6% of the total amount of the materials are cycled back into the economy. This is the result of the linear economic model. In a case study written by Thibaut Wautelet, he refers to the linear economic model as a production and consumption model based on the “take-make-waste” scheme. He explained that raw materials are collected, then transformed into goods that are used and finally discarded in landfills or incinerated as waste. This approach turned out to be broken, enabling overconsumption to the detriment of planetary health.
Governments and businesses are looking to adopt the circular economy model and start repairing the damage created by unsustainable production and consumption. According to a published research in “Cleaner Environmental Systems Journal”, authors define circular economy as a catalyst for sustainable business. Moreover, the circular model promotes “…the use of resources within closed-loop systems, reducing pollution or avoiding resource leakage while sustaining economic growth.”
The pressure to adopt sustainability compels companies to implement the “reduce, reuse, and recycle” practices from the design stage to post-sales activities. Based on the same research, “Circular economy as a driver to sustainable businesses”, the influence of the circular economy can be seen in many business areas:
Cost management – The circular model leads to the transformation of products at the end-of-life cycles into resources for new products. Integrating material recycling into new components production can close the loop, reducing waste and the usage of more expensive raw materials.
Supply chain – The circular management of the supply chain is based on the coordination across the different members in closing, slowing, or narrowing energy and material flows. Additionally, the packaging system is an important aspect of the distribution process circularity.
Process management – The business processes are rebuilt to make them more circular, facilitating the reusing and recycling out of the desire to extend product life and reduce environmental impact.
Service management – The Product-Service system is considered an enabler of the circular economy by offering services instead of products aiming at pro-environmental outcomes.
Research and development – The achievement of circular goals relies heavily on design, which determines the circular potential. The life-cycle-based research and development allows the selection of the type and quantity of materials and determining how they are combined – a process that affects the product life and the possibility of repairing and recycling it.
Figure 1. Product Lifecycle in Circular Economy Model | News European Parliament
Companies Leading the Change
Companies embrace the concept of circularity in response to the growing interest of customers in green practices and concerns about the global waste problem. Philips is one of the companies that are successfully paving the way toward the circular economy in their industry.
Philipswas one of the largest electronics companies in the world. But it has changed its focus on health technology, looking to improve people’s health and well-being. Its products include large-scale and small medical equipment and home care products. The company developed new business models to adapt to the circular principles organized on seven strategic pillars:
Close the loop with current products through take-back, refurbishment, and recycling
Further circular practices across Philips sites, including zero waste to landfill policy
The circular design of products and business models
Technical competence building
Driving change with external coalitions and supply chain
Embedding in the Philips Business System
In 2016, the company set goals to generate 15% of revenues from circular products and services and send zero waste to landfills in internal operations. At the end of 2020, Philips achieved their circular goals. Therefore, they set three greater targets for 2025: to generate 25% of revenue from circular solutions, send no waste to landfills, and close the loop by offering a trade-in on all professional medical equipment.
The Benefits of Adopting the Circular Model
The Circular Model and its principles are still new to the business ecosystem, and the market penetration of circular business models remains limited. But the potential to scale up the model is considerable in many industries.
Besides the environmental impact that the circular model creates through the reduction of greenhouse gas emissions or the use of fewer nonrenewable resources, or achieving zero waste, shifting toward circularity can help companies secure a competitive advantage and create long-term value.
The circular model enables new revenue streams by accessing new markets or cutting off costs from waste generation. It reduces the dependency on raw material suppliers and increases the resilience in the face of supply chain disruption.
Additionally, by implementing a circular model, businesses can attract new clients and improve the retention of old ones, as sustainable practices are becoming an influencing factor in customers’ buying decisions. Also, customer loyalty is favored due to servitization, product-as-a-service offerings or take-back programs.
Based on the survey conducted by Deloitte, more consumers this year are pursuing a better sustainable lifestyle. Results show that 40% of the consumers choose brands that promote sustainable values and practices, which increased by six points compared to 2021. The number of consumers who stopped purchasing from a specific brand due to their ethical or sustainable issues and concerns towards the company has also increased by six points in 2022, which is 34%.
Going in circles is the way forward. It is time for companies to rethink how they do business, considering the industrialization’s impact on the environment, relevant international initiatives, such as the UN Sustainable Development Goals and the EU Circular Economy Action Plan, and the increasing importance of sustainability to everyday customers. The change may be difficult for organizations used to operating in the linear economy but not impossible as seen in the above examples. In order to thrive in the market, companies must establish circular business models and adapt their strategies to the circular economy.
Needless to say, innovation has become a necessity for organizations. Innovation influences a firm’s performance and helps them to gain a competitive advantage and become market leaders. Companies claim to exert tremendous efforts in embracing innovation, yet many still do not have a clear innovation strategy and are unable to clearly align it with their overall business strategy. Some would opt to just embed it within their values or cultures, or as a business attribute, without having a clear plan and system for its effective implementation.
PwC’s Innovation Benchmark (2017) showed that 54% of the surveyed companies (>1200 respondents) reported that they are struggling in bridging the gap between business strategy and innovation strategy. Companies would make enormous investments in innovation, however, they do not see the returns from these investments. This is mainly because there is no alignment between their innovation strategies and their business strategies.
There is no such thing as the “right innovation strategy”. Companies need to determine and create their own innovation strategy to fit their business needs such as business strategy, culture, and organizational structure. But why would companies go through all this hustle? Why is there a need for companies to create an innovation culture when they may already have a strong business strategy in place?
The answer is simple: it helps companies to have successful innovation management. Innovation strategy aids organizations to know whether there is a need to innovate, to what extent, and in what areas. Accordingly, a company’s innovation strategy should be communicated across their organization; all the way from the CEO down to the most junior person in the workplace.
Katz, Du Preez, & Schutte (2010) highlighted that innovation strategy can be described in two roles: the first one is an improvement role or, in this case, the “improvement innovation strategy”. The second role is a future business role or the “future business innovation strategy”. For the improvement role, innovation strategy does the following:
Aligns a firm’s objectives with innovation objectives;
Acts as a guide for the type, level, and influence of innovation needed to attain a firm’s objectives;
Allocates a firm’s resources between daily operations and innovation initiatives; and
Creates a road plan for a firm to effectively utilize resources for innovation.
In relation to the future business role, the innovation strategy aids firms to determine when and how to selectively abort the past (such as old methods and actions). This will also enable firms to direct their attention towards future business. In other words, the future business strategy would oblige a company to alter its pattern, position, or perspective strategy, which, in turn, pushes the firm to move from the current business and develop future business.
Consequently, there is no doubt that firms today need to innovate permanently within their organizations. However, they must do so in a strategic way. Here are some ideas on how you can do that within your firm:
Revisit your business strategy and make sure it is updated to your current business context.
Analyze your organization’s assets, competition, market opportunities, and the firm’s culture.
Consider the following components when defining your innovation strategy: type, level, impact, risks, collaboration, place, maturity, resources, and drivers.
Determine the right timing for market entrance in case of product or service innovation.
To sum up, there is no such thing as the perfect innovation strategy. It is a strategic management decision that should be carefully taken by the most senior leaders in the workplace. It has to be shared with each and every individual so that it is reflected right from the beginning of the innovation process. Considering the nine components mentioned above is essential to be able to develop your innovation strategy.
The first four components (type, level, impact, and risk) help the company to have the right blend of innovation needed to bolster the firm’s objectives and goals. As for collaboration (impacts the level of financial and human resources), place (assists the balance between the types of resources) and resources (divides the resources between the daily operations, innovation initiatives, and innovation capability improvement), they provide a guideline of the allocation of resources for innovation. The last two components are drivers and maturity which make the company ready to innovate their future business.
The balanced scorecard (BSC) is a widely used performance measurement framework for strategic planning. It is so popular, in fact, that The KPI Institute’s latest 
