Ch. 9- Strategy Review, Evaluation, and Control

Measuring Organization Performance: Three Critical Comparisons

1. Comparing the firm's performance over different time period 2. Comparing the firm's performance to competitors' 3. Comparing the firms' performance to industry averages

Strategy Evaluation: Three Basic Activities

1. Examine the underlying bases of a firm's strategy 2. Compare expected results with actual results 3. Take corrective actions that ensure that performance conforms to plans

Reviewing Basis of Strategy

1. How have competitors reacted to our strategies? 2. How have competitors' strategies changed? 3. Have major competitor's strengths and weaknesses changed? 4. Why are competitors making certain strategic changes? 5. Why are some competitors' strategies more successful than others? 6. How satisfied are our competitors with their present market positions and profitability? 7. How far can our major competitors be pushed before retaliating? 8. How could we more effectively cooperate with our competitors?

Effective Contingency Planning

1. Identify both good and bad events that could jeopardize strategies 2. Determine when the good and bad events are likely to occur 3. Determine the expected pros and cons of each contingency event 4. Develop contingency plans for key contingency events 5. Determine early warning trigger points for key contingency events

Guidelines for Effective Strategic Management

1. Keep the process simple and easily understandable 2. Eliminate vague planning jargon 3. Keep the process nonroutine; vary assignments, team membership, meeting formats, settings, and even the planning calendar 4. Welcome bad news and encourage devil's advocate thinking 5. Do not allow technicians to monopolize the planning process 6. To the extent possible, involve managers from all areas of the firm

Strategy Evaluation Criteria

Consonance Consistency Advantage Feasibility

Auditing

a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between these assertions and established criteria, and communicating the results to interested users

The Balanced Scorecard

aims to balance long-term with short-term concerns, and to balance internal with external concerns

Contingency Plans

alternative plans that can be put into effect if certain key events do not occur as expected