The bowtie diagram is a valuable risk management tool that can enhance the toolkit of any strategy professional.
- July 2025 update: The Bowtie map has been added as a new map type in BSC Designer, and can now be generated automatically for any scorecard.
Bowtie Method Applied to Strategic Planning
A bowtie diagram visualizes the cause-and-effect logic associated with a specific event. In risk management, this typically refers to a risk event, but the concept can be generalized and applied to any event where understanding its causes and consequences is essential to the strategic journey.
Setting Up a Bowtie Diagram
Visually, the diagram takes the shape of a bowtie:
- The central event is placed in the middle
- Potential threats or root causes appear on the left
- Possible consequences are mapped on the right
In addition to identifying causes and consequences, the bowtie diagram also highlights controls (referred to as barriers in risk management). These controls are applied in two key areas:
- To manage causes (e.g., preventive controls in risk management)
- To manage consequences (e.g., to minimize the impact of a specific risk event)
The implementation and effectiveness of these controls can be measured. In risk management, escalation factors are conditions that can reduce the effectiveness of a control.
If you are already using BSC Designer, it is likely that you have applied controls within your scorecards—perhaps without explicitly labeling them as such. Several common use cases have been discussed in this article.
Bowtie for Strategic Planning: Example
To illustrate the use of a bowtie diagram, let’s consider the example of XYZ Eco Group, a company dedicated to creating urban green zones. Its operations, particularly manufacturing, depend heavily on logistics.
A key disruptive event in this context could be “Global Trade Policy Shifts and Supply Chain Volatility”—such as tariff wars, export bans, or new import restrictions.
To move from concept to application, let’s define the key threats related to this disruptive event and outline the corresponding controls and performance metrics used to manage them.
| Threat | Controls / Metrics |
|---|---|
| Sudden increase in tariffs |
|
| Export bans (e.g., rare earth elements) |
|
| Disruption of international freight |
|
Now let’s look at the potential consequences of the disruption—and how they can be managed through appropriate controls.
| Consequence | Controls / Metrics |
|---|---|
| Project delays |
|
| Increased costs / ROI impact |
|
| Reputational damage |
|
| Reduced product quality |
|
In this example, the state of each control was quantified using current, baseline, and target values. This allows us to calculate the present progress of each control and track it over time.
We can also distinguish between and monitor both efficiency and effectiveness by using leading and lagging indicators (see indicator type on the Context tab).
With current estimates of each control’s effectiveness, we can calculate the overall effectiveness of the control system—offering a clear view of XYZ Eco Group’s readiness to:
- Prevent the threat (via controls addressing causes),
- Mitigate the impact (through controls targeting consequences), and
- Ensure overall continuity, by evaluating the combined performance of all controls—reflected in the status of the root element in the scorecard.
Where needed, weights can be assigned to individual controls to reflect their relative importance or strategic impact, enabling a more nuanced assessment of organizational preparedness.
The current state of the controls can be visualized on a performance dashboard using user-defined metrics, enabling a clear and customizable view of control performance across the system.
Aligning Bowtie Analysis with Overall Strategy
Through this analysis, we have identified a key disruptive event by clearly defining its causes and expected consequences.
Rather than simply listing these elements, we also specified relevant controls tailored to the case. Each control is associated with measurable metrics, allowing for ongoing tracking and performance evaluation.
This bowtie analysis can be saved as a standalone functional scorecard. It can be reused in response to similar disruptions and referenced in other strategic or functional scorecards as needed.
For example, specific controls may be aligned—either through data or strategic context—with goals from other scorecards, such as:
- “Develop supplier risk assessment” from the compliance scorecard
- “Build expertise in alternative materials and technologies” from the R&D scorecard
- “Strengthen stakeholder communication skills” from the HR scorecard
Adding a Bowtie Diagram in BSC Designer
There are two ways to add a bowtie risk assessment diagram in BSC Designer:
- Option 1: Use the Bowtie Template. Log in to your account and navigate to New > New Scorecard > More templates … > Bowtie Analysis.
- Option 2: Create a Bowtie Map. Open any scorecard, switch to the Strategy map tab, click the Placement wizard button (next to the “Add” button), and select Bowtie as the map type.
Once new items are added to the scorecard, the Bowtie map will be updated automatically.
Conclusions
The bowtie analysis method is a valuable tool when there is a need to understand causality and to track the effectiveness of controls over time. It is especially relevant in strategic planning subdomains such as:
A typical use case involves identifying causes and consequences, defining and quantifying preventive controls, and monitoring the effectiveness of those controls through performance metrics.
You can review the bowtie analysis discussed in this article by logging into the demo account of XYZ Eco Group.
Alexis is a Senior Strategy Consultant and CEO at BSC Designer, with over 20 years of experience in strategic planning. With a background in applied mathematics and information technology, he brings a strong analytical and systems-oriented perspective to strategy and performance management. Alexis developed the “5 Step Strategy Implementation System” that helps companies with the practical implementation of their strategies. He is a regular speaker at industry conferences and has written more than 100 articles on strategy and performance management, as well as the book “10 Step KPI System”. His work is frequently cited in academic research.