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STRATEGIC EVALUATION AND CONTROL-TYPES OF

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Strategic evaluation and control is the process of determining the  Email

effectiveness of a given strategy in achieving the organizational objectives and
taking corrective actions whenever required. Subscribe Now

Control can be exercised through formulation of contingency strategies and a We don't spam. We Educate.

crisis management team. There can be the following types of control –

(i) Operational control- It is aimed at allocation and use of organizational resources through CHOOSE YOUR SUBJECT
evaluation of performance of organizational units, divisions, SBU`s to assess their contribution in
achieving organizational objectives. Advertising Management (20)
Articles (270)
(ii) Strategic control- It takes into account the changing assumptions that determine a strategy, Banking and Insurance (22)
continually evaluate the strategy as it is being implemented and take the necessary steps to adjust the Blog (32)
strategy to the new requirements. Business & Entrepreneurship (6)
Business Communication (15)
Business Environment (21)
The four basic type of strategic control are-
Business Ethics (2)
Business Law (1)
1. Premise control- It identifies the key assumptions and keeps track of any change in them to assess Business Statistics (49)
its impact on strategy and implementation. The goal is to find if the assumptions are still valid or not .It Company Law (14)
is generally handled by the corporate planning staff considering the environmental and organizational Computer Applications (9)
factors. Consumer Behaviour (22)
Cost Accounting (3)
2. Implementation control- It includes evaluating plans, programs, projects, to see if they guide the E-commerce (8)
organization to achieve predetermined organizational objectives or not. It leads to strategic rethinking Entrepreneurship (11)
.It consists of identification and monitoring of strategic thrusts. Financial Accounting (2)
Financial Management (29)
3. Strategic surveillance- It aims at generalized control. It is designed to monitor a broad range of Financial Services (19)
events inside and outside the organization that are likely to threaten the course of the firm. Human Resource Management (18)
Income Tax (2)
Organizational learning and knowledge management systems capture the information for strategic
International Business (13)
surveillance.
Investment Analysis & Portfolio Management (11)
IT & Technical Skills (5)
4. Special Alert control- It is a rapid response or immediate reassessment of strategy in the light of Macro-Economics (9)
sudden and unexpected events. It can be exercised through formulation of contingency strategies and Management Accounting (18)
a crisis management team. Management Information System (4)
Managerial Economics (2)
Strategic Evaluation Process- Marketing & Advertising (7)
Marketing Management (18)
(A) Setting standards of performance – It must focus on questions like: Marketing of Services (6)
Micro-Economics (2)
What standards should be set? Operations Management (2)
How should the standards be set? Organizational Behaviour (7)
In what terms should these standards be expressed? Personal Finance (2)
Principles of Management (9)
The firm must identify the areas of operational efficiency in terms of people, processes, productivity Project Management (11)
and pace. Standards set must be related to key management tasks. The special requirement for Projects and Presentations (35)
performance of these task must be studied. It can be expresses in terms of performance indicators. Public Finance (11)
Research Methodology (9)
The criteria for setting standards may be qualitative or quantitative. Therefore standards can be set Rural Marketing (1)
keeping in mind past achievements, compare performance with industry average or major Strategic Management (14)
competitors. Factors such as capabilities of a firm, core competencies, risk bearing ability, strategic
clarity and flexibility and workability must also be considered.
RECENT POSTS

(B) Measurement of performance – Standards of performance act as a benchmark in evaluating the

Internal Sources of Finance
actual performance. Operationally it is done through accounting, reporting and communication October 17, 2020
system. The key areas which must be kept in mind are – difficulty in measurement, timing of
measurement (critical points) and periodicity in measurement (task schedule). Deferred Shares and No Par Shares
September 10, 2020

Mutual Fund – Meaning, Types, Advantages, Mutual Funds in India

(C) Analyzing variances – The two main tasks are noting deviations and finding the cause of September 9, 2020
deviations.
♦ When actual performance is equal to budgeted performance tolerance limits must be set. Merchant Banking – Meaning, Significance, Functions

♦ When actual performance is greater than budgeted performance one must check the validity of
June 28, 2020

standards and efficiency of management. Retail Banking and Retail Lending

June 27, 2020
♦ When actual performance is less than budgeted performance we must pinpoint the areas where Bank Mandate, Power of Attorney, Banker`s Lien, Right to Set-off,
Garnishee Order and Attachment order
performance is low and take corrective action, June 27, 2020

The cause of deviations may be – External or internal, Random or expected, Temporary or permanent. Banking Instruments & Banking Transactions
The two main questions to focus upon are : June 27, 2020

Are the strategies still valid? Corporate Banking – Services, Clientele, Products & Pricing
June 22, 2020

Does the organization have the capacity to respond to the changes needed?
Classification of Loans
June 22, 2020
(D) Taking corrective actions – It consists of the following-

♦ Checking of performance – It includes in-depth analysis and diagnosis of the factors that might be KYC – Know Your Customer – Meaning, Objectives, Norms
June 21, 2020
responsible for bad performance.

♦ Checking of standards – It results in lowering or elevation of standards according to the

conditions.

♦ Reformulate strategies,plans,objectives – Giving a fresh start to the strategic management

process

Importance of Strategic evaluation and control

There is a need for feedback ,appraisal and reward
to check on the validity of strategic choice
Congruence between decisions and intended strategy
Creating inputs for new strategic planning

BY: BBAMANTRA / IN: ARTICLES, STRATEGIC MANAGEMENT / WITH: 0 COMMENTS

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