Strategic Evaluation and

Control

Name – kanika Bhasin

Strategic Evaluation and Control
 Strategic evaluation and control
constitutes the final phase of strategic
management.
Strategic Evaluation and Control
 Strategic evaluation operates at two
levels:
• Strategic level - wherein we are concerned
more with the consistency of strategy with the
environment.
• Operational level – wherein the effort is
directed at assessing how well the
organisation is pursuing a given strategy.
Purpose of Strategic Evaluation
 The purpose of strategic evaluation is to
evaluate the effectiveness of strategy in
achieving organisational objectives.
Definition
 Strategic evaluation and control could be
defined as the process of determining
the effectiveness of a given strategy in
achieving the organisational objectives
and taking corrective action wherever
required.
Nature of Strategic Evaluation
 To test the effectiveness of strategy.


To achieve a set of objectives and then implement the
strategy.

There has to be a way of finding out whether the strategy being
implemented will guide the organisation towards its intended
objectives.



Performs the crucial task of keeping the organisation on the
right track.

In the absence of such a mechanism, there would be no means

for strategists to find out whether or not the strategy is
producing the desired effect.
Importance of Strategic
Evaluation
 Strategic evaluation helps to keep a check on
the validity of a strategic choice.
 Provide feedback on the continued relevance
of the strategic choice made during the
formulation phase.

This is due to the efficacy of strategic

evaluation to determine the effectiveness of
strategy.
Importance of Strategic
Evaluation
 During the course of strategy implementation
managers are required to take scores of
decisions.
 Strategic evaluation can help to assess
whether the decisions match the intended
strategy requirements.
 In the absence of such evaluation, managers
would not know explicitly how to exercise such
discretion.
Participants in Strategic
Evaluation
 Shareholders
 Board of Directors
 Chief executives
 Profit-centre heads
 Financial controllers
 Company secretaries
 External and Internal Auditors
 Audit and Executive Committees
 Corporate Planning Staff or Department
 Middle-level managers
Barriers in Evaluation
 Limits of control
 Difficulties in measurement
 Resistance to evaluation
 Rely on short-term implications of
activities
Strategic choice

It determines the future strategy of the firm

It tells ‘ where shall we go’

STRATEGIC CONTROL
 Strategic controls take into account the
changing assumptions that determine a
strategy, continually evaluate the strategy as it
is being implemented, and take the necessary
steps to adjust the strategy to the new
requirements.
 In this manner, strategic controls are early
warning systems and differ from post-action
controls which evaluate only after the
implementation has been completed.
STRATEGIC CONTROL
 The types of strategic controls are:
• Premise control
• Implementation control
• Strategic surveillance
• Special alert control
 Premise Control
 Premise control is necessary to identify the key
assumptions, and keep track of any change in them so as to
assess their impact on strategy and its implementation.
 Premise control serves the purpose of continually testing the
assumptions to find out whether they are still valid or not.
 This enables the strategists to take corrective action at the
right time rather than continuing with a strategy which is
based on erroneous assumptions.
 The responsibility for premise control can be assigned to the
corporate planning staff who can identify key asumptions
and keep a regular check on their validity.
Implementation Control
 Implementation control may be put into
practice through the identification and
monitoring of strategic thrusts such as an
assessment of the marketing success of
a new product after pre-testing, or
checking the feasibility of a diversification
programme after making initial attempts
at seeking technological collaboration.
Strategic Surveillance
 Strategic surveillance can be done
through a broad-based, general
monitoring on the basis of selected
information sources to uncover events
that are likely to affect the strategy of an
organisation.
Special Alert Control
 Special alert control is based on trigger
mechanism for rapid response and
immediate reassessment of strategy in
the light of sudden and unexpected
events.
Special Alert Control
 Crises are critical situations that occur unexpectedly and
threaten the course of a strategy.
 Organisations that hope for the best and prepare for the
worst are in a vantage position to handle any crisis.
 Crisis management follows certain steps:
• Signal detection
• Preparation/prevention,
• Damage limitation,
• Recovery leading to organisational learning.
 The first step of signal detection can be performed by the
special alert control systems.