Chapter 14

Strategic Evaluation and Control

Meaning of Strategic Evaluation
Strategic evaluation may be defined as the process of seeing
whether everything is going on in conformity with the strategic
objectives set.

Strategic Evaluation and Control Process

1. Determine what to measure
2.Establish standards of performance
3. Measure actual performance
4. Compare actual performance with standard
5. Taking corrective action
Objectives of Strategic Evaluation and Control Process

1. To determine accuracy
2. To determine whether strategy is executed properly
3. To ensure execution as per plans set
4. To generate data to executive performance
5. To enhance organizational learning
Components of Strategic Evaluation and Control

1. Strategic surveillance
2. Special alert control
3. Premise control
4. Implementing of control
Designing Effective Strategic and Control Systems
1. They are future oriented
2. Link strategy with
a. consistency
b. consonance
c. advantage
d. feasibility
3. Emphasizing both content and process issues
4. Balancing short and long term demands
5. Establishing formality without undue bureaucracy
6. Encouraging learning.
Reasons of Failure of Evaluation and Control Process

1. Poor system design factors

2. Management factors
3. Misconception about SEC
Problems in Measuring Performance

1. Short-term orientation
2. Goal displacement
3. Behavior substitution
4. Sub optimization
Guidelines for Proper Evaluation and Control

1. Involving minimum information

2. Monitoring meaningful activities and results
3. Establishing timely control
4. Using short and long term controls
5. Pinpointing exceptions
6. Emphasizing rewards for reaching/ exceeding standards.
Factors Affecting Strategic Evaluation and Control Process

1. Time frame
2. Corrections of mistakes
3. Reporting intervals
Signs of Inadequate Evaluation and Control Process

1. Deadlines missed frequently

2. Poor quality of goods and services
3. Declining or stagnant sales or profits
4. Loss of market share
5. Inability to obtain necessary data
6. Low morale and high absenteeism
7. Insufficient employee involvement
8. Poor employer-employee communication
9. Improper use of human and material resources.
Techniques of Strategic Evaluation and Control

1. Financial Control
2. The Budgetary Control
3. Quality Control
4. Total Quality Control
5. Statistical Control:
a) acceptance sampling
b) statistical control process(periodic random samples to
measure product quality)
1. Inventory Control.