Strategic Evaluation and Control?

The purpose of Strategic Evaluation is to evaluate the effectiveness of the strategy in achieving organizational objectives. Thus it is process of determining the effectiveness of a given strategy in achieving the organizational objectives and taking corrective action whenever required. Strategic Evaluation operates at two levels: Strategic Evaluation, where the concentration is more on the consistency of the strategy with the environment. Operational Evaluation, where the effort is directed at the assessing how well the organization is pursuing a given strategy. The importance of Strategic evaluation lies in its ability to coordinate the tasks performed by the individual managers, divisions or SBUs, through the control of performance. In the absence of evaluation, individual managers may pursue goals, which are inconsistence with the overall objectives. There is a need for feedback, appraisal and reward; check on the validity of strategic choice; congruence between decision and intended strategy; and creating inputs for new strategic planning. Strategic evaluation helps to keep a check in the validity of a strategic choice. An ongoing process of evaluation would in fact provide feedback on the continued relevance of the strategic choice made during the formulation phase. This is due to the efficiency of the strategic evaluation to determine the effective of the strategy. Requirements of effective Evaluation: Control should involve only the minimum amount of information. Too much information tends to clutter up the control system and creates confusion. Control should monitor only managerial activities and results even if the evaluation is difficult to perform. Long-term and short-term control should be used so that a balanced approach to evaluation can be adopted. Controls should aim at pinpointing exceptions. The 80:20 principle where 20% of the activities result in 80% of achievement needs to emphasized. Rewards for meeting or exceeding standards should be emphasized so that managers are motivated to perform. Unnecessary emphasis on penalties tends to pressurize the managers to rely on efficiency rather than effectiveness. Barriers in evaluation: The limits of control Difficulties in measurement Resistance to evaluation Tendency to rely on short term assessment. Relying on efficiency versus effectiveness.

Control
Every Strategy is based on certain assumptions about environmental and organizational factors. Some of these factors are highly significant and any change in them can affect the strategy to a great extent. Premise control is necessary to identify the key assumptions, and keep track of any change in them so as to access their impact on strategy and its implementation. It enables the strategist to take corrective action at the right time. Control should involve only the minimum amount of information. Too much information tends to create confusion. Control should monitor only the managerial activities and results even if the evaluation id difficult to perform. Long term and short term controls should be used so that a balanced approach to evaluation can be adopted and controls should aim at pinpointing exceptions. The 80:20 principles, where 20 percent of the activities result in 80 percent of the achievement, needs to be emphasized. Rewards for meeting or exceeding standards should be emphasized so that, managers are motivated to perform. Unnecessary emphasis on penalties tends to pressurize the managers to rely on efficiency rather than effectiveness. Implementation of control The implementation of control is aimed at evaluating whether the plans, programmes and projects are actually guiding the organisation towards its predetermined objectives or not. Implementation control may be put into practice through the identification and monitoring of strategic thrusts. Another method of implementation of control is milestone view.