week 16-17 Flashcards
(16 cards)
is vital to an organization’s well-being
NATURE OF STRATEGY EVALUATION
timely evaluations can alert management to problems or potential problems before a situation becomes critical.
NATURE OF STRATEGY EVALUATION
Strategy evaluation includes three basic activities:
(1) examining the underlying bases of a firm’s strategy,
(2) comparing expected results with actual results, and
(3) taking corrective actions to ensure that performance conforms to plans.
It is a process that allows firms to evaluate strategies from four perspectives
Balanced Scorecard
four perspectives of Balanced scorecard
financial performance,
customer knowledge,
internal business processes, and
learning and growth.
A basic premise of good strategic management is that firms plan ways to deal with unfavorable and favorable events before they occur.
Contingency planning
A strategy should not present inconsistent goals and policies.
Consistency
A strategy must neither overtax available resources nor create unsolvable subproblems.
Feasibility
refers to the need for strategists to examine sets of trends, as well as individual trends, in evaluating strategies.
Consonance
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.
Auditing
contend that top executives are the only persons in the firm with the collective experience, acumen, and fiduciary responsibility to make key strategy decisions
Top-down approach
advocates argue that lower- and middle-level managers and employees who will be implementing the strategies need to be actively involved in the process of formulating the strategies to ensure their support and commitment.
Bottom-up approach
This activity includes comparing expected results to actual results, investigating deviations from plans, evaluating individual performance, and examining progress being made toward meeting stated objectives.
Measuring organizational performance
should focus on changes in the organization’s management, marketing, finance/accounting production/operations, R&D, and management information systems strengths and weaknesses
Revised IFE Matrix
should indicate how effective a firm’s strategies have been in response to key opportunities and threats.
Revised EFE Matrix
summarizes strategy-evaluation activities in terms of key questions that should be addressed, alternative answers to those questions, and appropriate actions for an organization to take.
Strategy Evaluation Network
