Upload
merry-wade
View
212
Download
0
Tags:
Embed Size (px)
Citation preview
Session 11 – Part 2 Strategic Control
Chapter 13
McGraw-Hill/Irwin Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
1. Describe and illustrate four types of strategic control.
2. Summarize the balanced scorecard approach and how it integrates strategic and operational control.
3. Illustrate the use of controls to guide and monitor strategy implementation.
13-2
Establishing Strategic Controls
Strategic control is concerned with tracking a strategy as it is being implemented, detecting problems or changes in its underlying premises, and making necessary adjustments
Characterized as a form of “steering control”
13-3
Types of Strategic Control
Premise control Strategic surveillance Special alert control Implementation control
13-4
Premise Control
Premise control is designed to check systematically and continuously whether the premises on which the strategy is based are still valid
Environmental factors
Industry factors
13-7
Strategic Surveillance
Strategic surveillance is designed to monitor a broad range of events inside and outside the firm that are likely to affect the course of its strategy
Strategic surveillance must be kept as unfocused as possible
Despite its looseness, strategic surveillance provides an ongoing, broad-based vigilance in all daily operations
13-8
Special Alert Control
A special alert control is the thorough, and often rapid, reconsideration of the firm’s strategy because of a sudden, unexpected event
A drastic event should trigger an immediate and intense reassessment of the firm’s strategy and its current strategic situation
Crisis teams Contingency plans
13-9
Implementation Control
Strategy implementation takes place as series of steps, programs, investments, and moves that occur over an extended time
Implementation control is designed to assess whether the overall strategy should be changed in light of the results associated with the incremental actions that implement the overall strategy
Monitoring strategic thrusts Milestone reviews
13-10
Balanced Scorecard Methodology
An alternative approach linking operational and strategic control, developed by Harvard Business School professors Robert Kaplan and David Norton, is a system they names the balanced scorecard
The balanced scorecard is a management system (not only a measurement system) that enables companies to clarify their strategies, translate them into action, and provide meaningful feedback
13-11
Balanced Scorecard
Four perspectives:
1. The learning and growth perspective: How well are we continuously improving and creating value?
2. The business process perspective: What are our core competencies and areas of operational excellence?
3. The customer perspective: How satisfied are our customers?
4. The financial perspective:
How are we doing for our shareholders?
13-13