A revisited fuzzy DEMATEL and optimization method for strategy map design under the BSC framework: selection of objectives and relationships

Abstract

This paper proposes a quantitative method for the selection of strategic objectives and causal relationships to be included in a strategy map of a Balanced Scorecard. A strategy map usually contains the strategic objectives of an organization, grouped into four perspectives: (a) finances, (b) clients, (c) internal processes, and (d) growth and learning, all of them linked through cause-effect relationships. The use of quantitative tools, such as multicriteria decision making, has been proposed to model a strategy map and to select the causal relationships to be included. However, no work has been found in the literature to select the strategic objectives to be incorporated into the map. This is the gap that is addressed in this paper. To overcome this gap, the proposed method incorporates a fuzzy multicriteria method known as DEMATEL (decision-making trial and evaluation laboratory) with an optimization model to choose the strategic objectives and their causal relationships. DEMATEL is used to set priorities to the components of the strategy map, whereas the optimization model selects those to be included by producing the appropriate balance between conflicting goals that appear in building a strategy map (minimum amount of relationships among strategic objectives, maximizing the weight of the relationships/objectives selected). As an illustrative case, the method is applied to a higher education institution where expert judgment in this field provided validation of the strategy map designed.

Appendices

Appendix A

• Expert 1: Associate Professor, with 22 years of academic experience, Dottore Di Ricerca in Ingegneria (Politecnico Di Milano, 2006). She was the Academic Coordinator of Engineering and the Industrial Engineering program. Vice-president of the Latin American IISE chapter. Her area of interest is organizational management.

• Expert 2: Assistant Professor with more than 10 years of academic experience and 2 years of experience as a consultant with a Master degree in Industrial Engineering. Director of the Center for Management Systems Studies at her institution. Her area of interest is organizational management.

• Expert 3: Associate Professor with more than 20 years of academic experience. PhD in Systems Engineering. He was the Director of the Systems Engineering Department for 6 years. His research areas of interest are systemic thinking, systems simulation (agents, system dynamics) and Balanced Scorecard.

• Expert 4: Assistant Professor with more than 15 years of academic experience. PhD in Engineering. Director of the Industrial Engineering Program. His research areas are related to Organizational Management, specially applications of Balanced Scorecard.

• Expert 5: Director of the Civil Engineering Department with more than 20 years of academic and professional experience. Also, he is consultant in urban transport and strategy issues. Ph.D. in Transport Engineering of Universitat Politécnica de Catalunya and Master of Business Administration (MBA) of Universidad Toruato di Tella (Argentina).

• Expert 6: Associate professor with more than 20 years of professional experience and consultant in telecommunications, strategy and management. Ph.D. in Systems Engineering and master in Operations Management of Universidad de Chile. He was Coordinator of the Industrial Engineering program. His research areas are related to Engineering Management.

Appendix B

Source of strategic objectives.

Learning and growth perspective
N°	Strategic area	Objective definition	Insight—source
A1	Research projects	Increase the number of research projects	Increase academic productions and develop technical knowledge (Rahimnia and Kargozar 2016)
			Increase the number of research projects (Valderrama et al. 2013)
A2	Innovation in teaching and learning	Train teachers in teaching and learning processes to generate constant growth	Excellence in the development of learning and learning skills (Farid et al. 2008)
			Excellence in teaching and learning (Papenhausen and Einstein 2006)
A3	Academic publications	Promote research publications with the aim of increasing the international profile	Increase the international profile through research publications (Cullen et al. 2003)
			Commercialize the achievements of research and use academic results in society; increase academic productions and develop technical knowledge; and increase the international profile through research publications (Rahimnia and Kargozar 2016)
A4	Faculty Development	Promote faculty development policies	Faculty development (Papenhausen and Einstein 2006)
			Didactic/learning innovations: development of a device/evaluation technique for each innovation (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
			Teacher development (Papenhausen and Einstein 2006)
			Didactic/learning innovations: development of a device/evaluation technique for each innovation (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
A5	IT infrastructure	Develop physical and virtual environments that foster cohesion and excellence for staff, students and collaborators	Information infrastructure: develop physical and virtual environments that foster cohesion and excellence of staff, students and collaborators (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
Internal processes perspective
P1	Quality in Colleges	Obtain certificates and accreditations that prove the quality of academic programs, research centers, laboratories, etc	Quality of the college: credentials and evaluations of the colleges, endowed chairs, development plans for deparments and colleges (Farid et al. 2008)
			Quality and circulation of the faculty: Faculty of quality, circulation of the faculty and the material/experiences of the class (Farid et al. 2008)
P2	Quality in the teaching processes	Create effective management of teaching which allows providing an excellent education	Improving the efficiency of teaching (Rahimnia and Kargozar 2016)
			Quality in teaching (Farid et al. 2008)
P3	Quality in administrative processes for students	Improve the effectiveness of services provided at the university	Efficiency and effectiveness of the service: effectiveness of student services (Farid et al. 2008)
			Improve service to students in accordance with national standards (Rahimnia and Kargozar 2016)
P4	Quality in administrative processes for employees	Improve the effectiveness of services provided at the university	Greater satisfaction and quality of the academic staff (Eftimov et al. 2016)
P5	Quality in the curriculum	Update the curriculum according to educational, business and commercial trends	Product quality: management of the quality of the curriculum (Wu et al. 2011)
			Excellence and innovation in the curriculum/program: curricular excellence and innovation; Introduction of new programs/innovations (Farid et al. 2008)
P6	Cooperation between the university and the business community	Establish relationships with industry that allow students to approach the professional field	Contacts with companies and industry (Farid et al. 2008)
P7	Cooperation between the university and other educational institutions	Establish relations with other national and international universities that allow students to carry out exchanges	Improve and expand productive and synergistic transactions with local and international academic, social and economic institutions (Rahimnia and Kargozar 2016)
P8	Adaptation of the campus	Provide students with adequate spaces for the realization of their academic activities	Adequacy of classrooms, facilities and equipment to provide globally relevant education management (Farid et al. 2008)
Customer perspective
C1	Student satisfaction	Provide services to students who meet their academic needs	Student satisfaction: ability to access the necessary courses and the ability to obtain a good job (Wu et al. 2011)
			Student satisfaction (Farid et al. 2008)
			Increase student satisfaction (Valderrama et al. 2013)
			Student satisfaction (Papenhausen and Einstein 2006)
C2	Expansion of new students	Increase the number of students enrolled	Expansion of new consumers (Wu et al. 2011)
			Increase students enrolled (Farid et al. 2008)
C3	Graduate students	Graduate professionals with high quality that adapt to the demands of society	Graduate high-quality experts, researchers and entrepreneurs according to the demands of society (Papenhausen and Einstein, 2006; Rahimnia and Kargozar 2016)
			Graduate high-quality students (Farid et al. 2008)
			Graduate high-quality students (Papenhausen and Einstein 2006)
C4	Brand	Position the university with the highest reputation	Image and reputation (Wu et al. 2011)
			Brand: reputation of the university (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
C5	Student welfare	Provide students with adequate spaces for carrying out their activities	Adequacy of participation in activities throughout the campus; quality of relations with other elements on campus (Farid et al. 2008)
			Service to the university: adequacy of the participation in the activities of the campus (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
Financial perspective
F1	Control of costs	Reduce direct and indirect costs associated with the provision of faculty services	Cost control: reduction of the direct cost of products and services, reduce indirect costs and share sources with other units (Wu et al. 2011)
			Reduction of the direct cost of products and services; reduce indirect costs and share sources with other units (Hashemkhani Zolfani and Safaei Ghadikolaei 2012)
F2	Resource management	Allocate resources effectively to teaching, research and consulting processes	Better use and control of resources (Eftimov et al. 2016)
			Effectiveness in the management of resources (Rahimnia and Kargozar 2016)
			Resource management (Sayed 2013)
F3	Fundraising	Raise funds needed to carry out the teaching, research, and consulting activities of the colleges	Fundraising: endowment/fundraising/annual donations (Farid et al. 2008)
F4	Increase in profitability	Increase revenues from services rendered	Annual revenue growth (Tseng 2010)
			Income from operations: increase in research grants, increase in state ownership, increase in student rates, increase in teacher productivity (Farid et al. 2008)