Evaluating:

Improving of
Strategy

Lesson 5
1
Learning Objectives

 Discuss the importance of evaluating strategies

 Appreciate the evaluation tool guide as productivity
improvement
 Show adeptness in the use of different evaluation
tools to measure performance

2
The Nature of Strategy
Evaluation

 Strategy review and evaluation refer to

assessing how well an organization has
performed vis-à-vis objectives and KPI

3
Criteria for Strategy
Evaluation

1. Consonance. This refers to the need to examine sets

of trends as well as individual trends in evaluating
strategies. A strategy must be an adaptive response
to the external environment and to the critical
changes occurring within it.
2. Advantage. A strategy must provide for the creation
and/or maintenance of competitive advantage in a
selected area of activity.
• Competitive advantage normally are the result of superiority 4
in one of three areas: a) resources b) skills c) position
Criteria for Strategy
Evaluation

3. Consistency. A firm’s strategies should be

aligned to its own goals and policies. Strategic
inconsistencies occur when organizational
conflict and cross-functional squabbling exist.
4. Feasibility. The final test of strategy is its
feasibility (i.e.) can the strategy be attempted
within the physical, human, and financial
resources). 5
Elements of Evaluation
Stage

Measuring Organizational Performance

 Decision makers can better monitor performance if they
receive accurate, timely and relevant measurement
reports.
1. Monitor for success, not control
2. Keep your eye on the strategic prize
3. Monitor selectively

6
Characteristics of an
Effective Evaluation System

1. Relevance
2. Reliability
3. Economical
4. Objective

7
Tools in the Evaluation
Stage

1. Contingency Measures
• Anticipation of any probable eventualities or risks
that may occur to mitigate the potential concerns.
• It is necessary to keep business from being caught
off-guard by foreseeable event and be able to match
the company’s strengths and weaknesses.
• It can promote a strategist’s ability to respond
quickly to key changes in the internal and external
bases of an organization’s current strategy. 8
Benefits of Contingency
Plans

1. It permits quick response to change

2. It prevents panic in crisis situations
3. It makes managers more adaptable by
encouraging them to appreciate just how
variable the future can be

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Tools in the Evaluation
Stage

2. The Balanced Scorecard - a performance

measurement system that considers financial
measures as well as customer, business
process and learning measures.
• It begins with a definition of strategy, objectives,
company-wide and business unit targets and
individual measures and targets.
“It is a strategic planning and management system used to align
business activities to the vision statement of an organization” – Kaplan 10
and Norton
The Balanced Scorecard

a) Vision/Mission Statement

b) Financial status

c) Structure and operations

d) Employees’ level of specialization

e) Customer satisfaction level 11

The Balanced Scorecard

 This tool gives managers a more balanced appreciation

of organizational performance.

 It is viewed from both internal and external outlook

evaluating the organizational’s strategy into four core
perspectives namely: financial, customer, business
processes and learning and growth.

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The Balanced Scorecard

13
Evaluation: Improvement
of Strategy

 The SIT: A Tool for Improving Performance

• is a performance improvement tool where a group
of employees from different functional areas
collaborates to improving productivity level
through identifying the trouble spots or snags in
various facets of firm’s operation.

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