Strategic Control: A Comprehensive Overview of the Process and Techniques

Strategic control is an integral part of the strategic management process, designed to evaluate the implementation and subsequent results of a strategy. Its primary purpose is to identify any deviations or issues that may arise during the implementation phase and take appropriate corrective actions to ensure the strategy’s success.

Types of Strategic Control Techniques

There are several types of strategic control techniques, each serving a specific purpose:

Premise Control

Premise control involves verifying the assumptions or premises on which the strategy is based to ensure their continued validity. This helps identify any changes in the internal or external environment that may impact the strategy’s effectiveness.

Implementation Control

Implementation control focuses on assessing the incremental actions and phases of strategic implementation to ensure they are aligned with the overall strategy. It monitors progress, identifies potential roadblocks, and ensures that resources are allocated efficiently.

Special Alert Control

Special alert control is a reactive process that is activated in response to unexpected events or extreme situations that impact the organization. It involves conducting a thorough assessment of the situation and taking swift corrective actions to mitigate any negative consequences.

Strategic Surveillance Control

Strategic surveillance control involves conducting a broader information scan to identify any overlooked factors that may impact the strategy. This includes monitoring industry trends, competitor activities, and changes in the regulatory landscape.

The Strategic Control Process

The strategic control process typically involves six steps:

Determining What to Control

Organizations must prioritize what elements to control based on their relevance to the mission, vision, and strategic goals. This involves identifying key performance indicators (KPIs) and metrics that align with the strategic objectives.

Setting Control Standards

Control standards are established to measure and evaluate performance. These standards can be quantitative, such as financial targets, or qualitative, such as customer satisfaction ratings.

Measuring Performance

Performance is measured regularly to track progress towards strategic goals. This involves collecting data, analyzing trends, and comparing actual performance to the established standards.

Comparing Actual Performance to Standards

The comparison of actual performance to standards helps identify any deviations or gaps. This analysis allows organizations to assess whether the strategy is being implemented as planned and whether adjustments are necessary.

Analyzing Deviations

If there are deviations from the standards, organizations must analyze the reasons behind these discrepancies. This involves examining internal factors, such as resource constraints or process inefficiencies, as well as external factors, such as market changes or competitor actions.

Deciding on Corrective Actions

Based on the analysis of deviations, organizations can decide on appropriate corrective actions. This may involve modifying the strategy, reallocating resources, or implementing new initiatives to address the identified issues.

The Role of Balanced Scorecard in Strategic Control

The Balanced Scorecard (BSC) is a popular tool used for strategic control. It provides a comprehensive framework for measuring and evaluating performance across multiple perspectives, including financial, customer, internal process, and learning and growth. By aligning day-to-day activities with the overall strategy, the BSC helps organizations identify and address any gaps or misalignments.

Balanced Scorecard software, such as ClearPoint, can simplify the data collection, analysis, and reporting tasks involved in strategic control. These tools enable organizations to automate data integration, generate real-time performance dashboards, and conduct scenario analyses to assess the impact of potential changes to the strategy.

Conclusion

Strategic control is a critical process that enables organizations to monitor and evaluate the implementation of their strategies. By identifying deviations, analyzing their causes, and taking corrective actions, organizations can ensure that their strategies remain aligned with their goals and objectives, even in the face of changing circumstances. The use of tools such as the Balanced Scorecard and specialized software can further enhance the effectiveness of strategic control by providing real-time insights and facilitating data-driven decision-making.

References

1. Strategic Control: Breaking Down The Process & Techniques. (2024, January 16). ClearPoint Strategy. https://www.clearpointstrategy.com/blog/strategic-control-process
2. Strategic Control: Meaning, Process, Importance And Examples. (2021, November 30). Harappa. https://harappa.education/harappa-diaries/strategic-control-process/
3. Strategic Control Simplified: A 6-Step Process And Tools. (2023, June 2). Cascade. https://www.cascade.app/blog/strategic-control-process-and-tools

FAQs

1. What is strategic control?

Answer: Strategic control is the process of evaluating and monitoring the implementation of a strategic plan to ensure that it is achieving its intended objectives. It involves identifying deviations from the plan, analyzing their causes, and taking corrective actions to ensure that the plan remains on track.

2. What are the key elements of strategic control?

Answer: The key elements of strategic control include:

• Establishing clear goals and objectives
• Identifying key performance indicators (KPIs) to measure progress
• Monitoring performance and comparing it to targets
• Analyzing deviations from targets and identifying their causes
• Taking corrective actions to address deviations and improve performance

3. What are the different types of strategic control?

Answer: There are several types of strategic control, including:

• Premise control: Verifying the assumptions on which the strategy is based
• Implementation control: Monitoring the progress of strategy implementation
• Special alert control: Responding to unexpected events or crises
• Strategic surveillance control: Scanning the environment for potential threats or opportunities

4. What are the benefits of strategic control?

Answer: The benefits of strategic control include:

• Improved performance: Strategic control helps organizations identify and address problems early on, preventing them from derailing the strategy.
• Increased agility: Strategic control allows organizations to adapt their strategies to changing circumstances, ensuring that they remain relevant and effective.
• Better decision-making: Strategic control provides organizations with the information they need to make informed decisions about their strategy and operations.
• Enhanced accountability: Strategic control holds managers and employees accountable for their performance, ensuring that they are working towards the achievement of strategic goals.

5. What are some common challenges in strategic control?

Answer: Some common challenges in strategic control include:

• Lack of clear goals and objectives: Without clear goals and objectives, it is difficult to measure progress and identify deviations.
• Poorly designed KPIs: KPIs that are not aligned with strategic goals or that are difficult to measure can lead to inaccurate or misleading information.
• Inadequate monitoring and reporting: Failure to monitor performance regularly or to report on progress can make it difficult to identify problems early on.
• Resistance to change: Employees may resist changes to the strategy or to their own work practices, which can make it difficult to implement corrective actions.

6. How can organizations improve their strategic control?

Answer: Organizations can improve their strategic control by:

• Setting clear goals and objectives
• Identifying relevant KPIs
• Monitoring performance regularly and reporting on progress
• Analyzing deviations from targets and identifying their causes
• Taking corrective actions to address deviations and improve performance
• Creating a culture of accountability
• Providing employees with the training and resources they need to implement the strategy

7. What are some best practices in strategic control?

Answer: Some best practices in strategic control include:

• Using a balanced scorecard to measure performance across multiple perspectives
• Automating data collection and reporting to improve efficiency and accuracy
• Conducting regular strategy reviews to assess progress and make adjustments as needed
• Involving employees in the strategic control process to gain their buy-in and commitment

8. What are some common mistakes in strategic control?

Answer: Some common mistakes in strategic control include:

• Focusing on short-term results at the expense of long-term goals
• Failing to monitor performance regularly or to report on progress
• Ignoring deviations from targets or failing to take corrective actions
• Making changes to the strategy without considering the potential consequences
• Not involving employees in the strategic control process