Strategic Management PEARCE & ROBINSON

1. CHAPTER 11 Strategic Control and Continuous Improvement

3. What is Strategic Control? Tracks a strategy as it is implemented, detects problems or changes in its underlying premises, and makes necessary adjustments

5. Ex. 11-1: Four Types of Strategic Control Strategic Surveillance Premise Control Time 1 Strategy Formulation Time 2 Time 3 Strategy Implementation Implementation Control Special Alert Control

6. Ex. 11-1: Characteristics of the Four Types of Strategic Control Occurrence of recognizable but unlikely events High High High Potential threats and opportunities related to the strategy Low Low Low Key strategic thrusts and milestones High High Medium Planning premises and projections High Medium Low Objects of control Degree of focusing Data Acquisition: Formalization Centralization Special Alert Control Strategic Surveillance Implementation Control Premise Control Basic Characteristics

7. Ex. 11-1 (contd.) Yes Yes Yes Seldom Yes Yes Seldom Seldom Seldom Seldom Yes Yes Yes Yes No No Use with: Environmental factors Industry factors Strategy-specific factors Company-specific factors Special Alert Control Strategic Surveillance Implementation Control Premise Control Basic Characteristics

9. Types of Implementation Control Milestone reviews Monitoring strategic thrusts

10. Establishing Effective Operational Control Systems Set standards of performance Measure actual performance Initiate corrective action Identify deviations from standards set Steps involved in postaction control systems

13. The Value Chain Approach to Developing a Customer Orientation External suppliers Internal suppliers (functions) Input Input Function (like production) Seeking: Quality Efficiency Responsiveness Outputs Outputs External (ultimate) customer Other internal customers (activities)

14. What is Six-Sigma? A highly rigorous and analytical approach to quality and continuous improvement with an objective to improve profits through deficit reduction, yield improvement, improved customer satisfaction and best-in-class performance

18. Ex. 11-7: Integrating Shareholder Value and Organizational Activities Across Organizational Levels CEO Corporate/Divisional Functional Depts. And Teams Shareholder value creation ROCE Economic Profit Margin Capital Turnover Sales Targets COGS/ Sales Dev. Cost/ Sales Inv. Turnover Cap. Utilization Cash Turnover Order Size Customer Mix Sales/Account Customer Churn Rate Deficit Rates Cost Per Delivery Maintenance Cost New Product Dev. Time Indirect/Direct Labor Customer Complaints Downtime Accounts Payable Time Accounts Receivable Time