Strategic Control 1. Responding Effectively To Environmental Change 2.

Attaining Behavioral Control

Strategic Control
Strategic control
the process of monitoring and correcting a firms strategy and performance Informational, behavioral

Approaches of strategic control (1) Informational control, which is the ability to respond effectively to environmental change, and (2) Behavioral control, which is the appropriate balance and alignment among a firms culture, rewards, and boundaries.
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Ensuring Informational Control

Traditional control system
1. strategies are formulated and top management sets goals 2. strategies are implemented 3. performance is measured against the predetermined goal set

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Traditional Approach to Strategic Control

Most appropriate when
Environment is stable and relatively simple Goals and objectives can be measured with certainty Little need for complex measures of performance

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Contemporary Approach to Strategic Control

Contemporary control system
Continually monitoring the environments (internal and external) Identifying trends and events that signal the need to revise strategies, goals and objectives

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Contemporary Approach to Strategic Control

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Behavioral Control
Building a Strong and Effective Culture
a system of shared values and beliefs that shape a companys people, organizational structures, and control systems to produce behavioral norms. Ensuring behavior consistent with organizational goals and objectives Balance among firms culture, rewards, and boundaries
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Behavioral control: 3 key components

Characteristics of Effective Reward and Evaluation Systems

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Motivating with Rewards and Culture

System of rewards and incentives coupled with a strong culture
Hire the right people Training plays a key role Managerial role models are vital Reward systems clearly aligned with organizational goals and objectives

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Setting Boundaries and Constraints

Focusing on the individual efforts according to the strategic priorities Provide short term objectives and action plans Improving efficiency and effectiveness Minimize improper and unethical conduct