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Techniques of strategic

evaluation and control


(1) premise control
(2) implementation control

Introduction
Strategy evaluation and control is the sixth step in the
strategic management process. As we have read that well
executed strategy definitely ensures successful achievement of
organizational goals and objectives. But changes internal and
external environment of an organisation may not allow the firm
to achieve desired goals and objective. The environment
changes may takes place at any stage of strategy
implementation. Strategy evaluation and control done after
measuring results shall not help in taking corrective action. It
should be done in the early stage of strategy execution, to see
whether the strategy is successfully implemented or not and to
carryout mid-course corrections whenever necessary. Therefore
strategists should systematically review, evaluate, and control
the process of strategy implementation.

Types of organizational control


The four basic types of strategy
controls are:
(1) Premise control
(2) implementation control
(3) strategic surveillance, and
(4) special alert control

(1) Premise control


premise control has been designed to check systematically and
continuously whether or not the promise set during the planning and
implementation process are still valid. If an important premise is no
longer valid, then the strategy has to be changed. LIC of India, for
example, has changed its strategy and introduced new policies in the
wake of liberalization of the economy. Premises are primarily concerned
with two types of factor:

(a) Business environmental factors:


organisation does not have control over the external
environmental factors, but these factor have considerable influence over
the success of its strategy, because strategies are generally based on the
assumption about them. Increase in interest rates and tax benefit on
fixed deposits above five years affected the life insurance companies
business. LIC companies have formulated strategy where they have come
up with innovation policies to attracts investment in LIC policies and had
the objective to increase premium collection.

(b) Industry Factor:


performance of a company is influenced by
industry factors. Recollect five forces given by porter
competitors, suppliers, substitutes and barriers to entry. Firms
formulate strategies after making assumption on these factors.
These factors differ from industry to industry.
strategies are formulated based on a good number of
premises, about environmental and industry factors. All
promises may not require the same amount of control.
Evaluation of all the premises is time consuming and expensive.
Therefore, managers must select premises and variables that
(1) Are likely to change and (2) would have a huge impact on
the organisation strategy

(2) Implementation control

strategy implementation does not take


place at one single point of time; it takes place as
series of steps, plans, programmes, investment,
disinvestment and moves, over a lengthy period.
implementation control is designed to assess
whether the overall strategy should be changed in
the light of unfolding events and results associated
with incremental steps and actions that implement
the overall strategy. Strategic implementation
control continuously question the basic direction of
the strategy. There are two basic types of strategy
implementation control. They are: (a) monitoring
strategic thrusts, and (b) milestone reviews.

(A) Monitoring strategic thrusts (new or key strategic


programmes)
Two approaches are useful in enacting implementation
control focused on monitoring strategic thrusts: (1) one way is to agree early
in the planning process on thrusts which are critical factors in the success of
the strategy or of that thrusts; (2) the second approach is to use stop/go
assessment linked to a series of meaningful thresholds (time, costs, research
and development, success, etc.) associated with particular thrusts.

(B)

Milestone Reviews

milestones are significant points in the development of a


programme, such as point where large commitment of resources must be
made. A milestone review usually involves a full scale reassessment of the
strategy and advisability of continuing or refocusing the direction of the
organisation. In order to control the current strategy, strategist must be
provided with strategic plans.

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