Techniques of Strategic Evaluation and Control

Strategic Evaluation and Control refer to the systematic process of assessing the efficiency and effectiveness of a strategy after its implementation to determine if it meets the set objectives and contributes to the overall goals of an organization. This involves continuous monitoring and analyzing the actual performance against planned targets, identifying deviations, and implementing corrective actions as needed.

Strategic evaluation and control are essential for ensuring that an organization’s strategies are effectively guiding it towards its goals. Various techniques are used in this process, each serving different purposes but collectively helping an organization stay on track.

• Benchmarking:

Comparing the organization’s processes and performance metrics to industry bests or best practices from other industries.

• Balanced Scorecard:

Incorporates financial and non-financial measures across four dimensions: Financial Performance, Customer Knowledge, Internal Business Processes, and Learning and Growth.

• Key Performance Indicators (KPIs):

Specific metrics defined to measure the effectiveness of current strategies in achieving organizational objectives.

• SWOT Analysis:

Evaluates strengths, weaknesses, opportunities, and threats to understand both internal and external environments affecting the organization.

• Management by Objectives (MBO):

Involves setting specific measurable objectives aligned with organizational goals, which are agreed upon by management and employees.

• Financial Ratio Analysis:

Uses ratios like return on investment (ROI), return on assets (ROA), and profit margins to analyze organizational financial health and performance.

• Value Chain Analysis:

Examines activities within the organization and identifies where value can be added to products and services, including identifying cost advantages or disadvantages.

• Scenario Planning:

Involves developing detailed, hypothetical scenarios to anticipate possible future conditions and how the organization might respond to them.

• Strategy Maps:

Visual representations of an organization’s overall objectives related to each other and the strategy itself, facilitating alignment and understanding across the organization.

• Performance Dashboards:

Provide real-time data on key performance indicators and critical success factors, allowing for quick adjustments to strategies and operations.

• Strategy Reviews:

Regular meetings to review the progress and efficacy of the strategic plan and make necessary adjustments.

• Environmental Scanning:

Constantly collecting information on external events and trends to identify potential threats or opportunities.

• Risk Management:

Identifying, analyzing, and responding to risks that could potentially impact the organization’s ability to achieve its objectives.