Strategy

Review,
Evaluation,
and Control
how do we review control and evaluate strategy >> make
sure these strategy implement well >> planning >> need to
know how the strategy implemented will be successful

Chapter Nine
 Chapter Objectives

1. Describe a practical framework for evaluating

strategies.
2. Explain why strategy evaluation is complex, sensitive,
and yet essential for organizational success.
3. Discuss the importance of contingency planning in
strategy evaluation.
4. Discuss the role of auditing in strategy evaluation.
5. Discuss the Balanced Scorecard.
6. Discuss three twenty-first-century challenges in
strategic management.

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 A Comprehensive Strategic-
Management Model

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 The Nature of Strategy Evaluation

Strategy evaluation includes three basic activities:

1.examining the underlying bases of a firm’s
strategy = kaji asas strategy tuh >>
2.comparing expected results with actual results
>> sales expect bila implement, mkt development
tapi end-up sebaliknya
3.taking corrective actions to ensure that
performance conforms to plans = sales tak naik
sbb tak banyak promo

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 Richard Rumelt’s Criteria for
Evaluating Strategies = 4 criteria
1. Consonance and 2. Consistency and
advantage are feasibility are largely
mostly based on a based on an internal
firm’s external assessment =
assessment = factor internal
outside xleh control

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 Rumelt’s Criteria for
Evaluating Strategies

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 Rumelt’s Criteria for
Evaluating Strategies

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 Rumelt’s Criteria for
Evaluating Strategies
 Consistency
-Goals and policies should be consistent with the strategy.
- Selari atau tak = banyak investment, hire expertise
Symptoms:
Interdepartmental bickering = tak puas hati dalam dept
- finance tak nak keluar duit, hr nak recruit
Managerial problems are not people-based
Success for one department means failure for another
department = Hr dapat recruit better, finance fail xde duit.
If policy problems are brought to the top resolution.

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 Rumelt’s Criteria for
Evaluating Strategies
 Consonance
A (strategy kena respond to the sets of
trends external factors) = make sure
strategy follow strength = techy = nak fon
canggih = product development = ikut
trend = pekerja OKU
Examples Sets of trend: education level,
increase in women in the workforce.

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 Rumelt’s Criteria for
Evaluating Strategies
 Feasibility
- Ensure that the strategy is doable within
the capability of organization. = changing
new product

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 Rumelt’s Criteria for
Evaluating Strategies
 Advantage
- A strategy should provide, maintain or
enhance CA in a selected area. = raw
material kena increase
- CA in resources, skills and position would
strengthen the company in the industry.
- CA bila implement certain strategy

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 Why Strategy Evaluation is
More Difficult Today = evaluate je ada benda
baru = banyak planning neede ambik masa
1. A dramatic increase in the
environment’s complexity = politics,
2. The increasing difficulty of predicting the
future with accuracy
3. The increasing number of variables =
banyak competitor, techy trends
4. The rapid rate of obsolescence of even
the best plans = cepat je outdated
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 Why Strategy Evaluation is
More Difficult Today
5. The increase in the number of both
domestic and world events affecting
organizations = covid-19
6. The decreasing time span for which
planning can be done with any degree of
certainty = plan lama2 tiba2 competitor
dah keluar produk baru

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 The Process of Evaluating
Strategies
 Strategy evaluation should initiate managerial
questioning of expectations and assumptions,
should trigger a review of objectives and
values, and should stimulate creativity = buat
fon baru, boleh keluar banyak version ke tak,
buat fon multipurpose = cipta market baru in
generating alternatives and formulating criteria
= quality, sales, create new market of
evaluation

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 The Process of Evaluating
Strategies
 Evaluating strategies on a continuous
rather than on a periodic basis allows
benchmarks of progress to be established
and more effectively monitored = bnyk
version fon = ilearn banyak ver
 Successful strategies combine patience
with a willingness to promptly take
corrective actions when necessary

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 A Strategy-Evaluation Framework

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 Measuring Organizational
Performance
Strategists use common quantitative criteria
to make 3 critical comparisons:
1.Comparing the firm’s performance over different
time periods = setiap sebulan sekali
2.Comparing the firm’s performance to
competitors’
3.Comparing the firm’s performance to industry
averages

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 Corrective Actions

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 The Balanced Scorecard

 The Balanced Scorecard approach to

strategy evaluation aims to balance long-
term with short-term concerns, to balance
financial with nonfinancial concerns, and
to balance internal with external
concerns.

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 An Example Balanced Scorecard

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 Characteristics of an Effective
Evaluation System = dalam company
ada system yg make sure
 Strategy evaluation activities must be economical =
appraisal system = economical = takleh costly
 too much information can be just as bad as too little information
= banyak sangat maklumat pon tak bagus = buat 1 tahun sekali
= market development = cth
 too many controls can do more harm than good = will
jeopardize
 Activities should be meaningful
 should specifically relate to a firm’s objectives = accountant
bagi training selain kira2 = hantar pb = test kecerdasan

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 Characteristics of an Effective
Evaluation System
 Activities should provide timely information =
appraisal yearly
 Activities should be designed to provide a true
picture of what is happening = gambarkan ke
tidak gambaran sebenar penilaian
 Activities should not dominate decisions
 should foster mutual understanding, trust, and
common sense = tak boleh bias = nak nilai
accountant suruh lari padang = tak kena = tak boleh
bagi final masa pkp

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 Contingency Planning = buy new
land or innovate old store
-Alternative plans to deal with unfavorable
and favorable events
-Prepared for high-priority areas
-A part of evaluation process.
-When the strategy-evaluation reveals the
need for a major change quickly, an
appropriate contingency plan can be
executed in a timely way.
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