I. Review effectiveness of strategy --
1. Competitors’ reaction to strategy 2. Competitors’ change in strategy 3. Competitors’ changes in strengths &
weaknesses 4. Reasons for competitors’ strategic change
negative impact on organizations
Ch 9-4
Strategy raisal of Strategic Performance
Have assets increased Increase in profitability Increase in sales Increase in productivity Profit margins, ROI (Return on Investment) , & EPS
(Earnings Per Share) ratios increased
Ch 9-6
Strategy Evaluation, Review & Control
Consistency
Rummelt’s 4 Criteria for
Evaluating Strategy
Consonance Feasibility
7. Potential for competitor retaliation 8. Potential for cooperation with competitors
Ch 9-15
Strategy Evaluation, Review & Control
I. Monitor Strengths & Weaknesses; Opportunities & Threats
Chapter 8 Strategy Review, Evaluation, & Control
Ch 9-1
Chapter Outline
The Nature of Strategy Evaluation A Strategy-Evaluation Framework
The Balanced Scorecard
Strategy Evaluation, Review, & Control
Strategy Evaluation
Vital to the organization’s well-being Alert management to potential/actual problems
in a timely fashion Erroneous strategic decisions can have severe
Ch 9-11
I. Review Underlying Bases
Evaluation Framework
Differences?
Yes
NO
II. Measure Firm Performance
Differences?
Yes
NO
Continue present course
III. Take Corrective Actions
Ch 9-14
Strategy Evaluation, Review & Control
I. Review effectiveness of strategy --
5. Reasons for competitors’ successful strategies
6. Competitors’ present market positions & profitability
Ch 9-2
Strategy Review, Evaluation & Control
-- Strategies become obsolete -- Internal environments are dynamic -- External environments are dynamic
Ch 9-3
Ch 9-12
Strategy Evaluation, Review & Control
I. Review of underlying bases of strategy -
Develop revised EFE Matrix
Develop revised IFE Matrix
Ch 9-13
Strategy Evaluation, Review & Control
Consonance
Need for strategists to examine sets of trends as well as individual trends in evaluating strategies
Ch 9-9
Strategy Evaluation, Review & Control
Advantage
Ch 9-7
Strategy Evaluation, Review & Control
Consistency
Strategy should not present inconsistent goals & policies
Ch 9-8
Strategy Evaluation, Review & Control
Are strengths still strengths? Have we added additional strengths? Are weaknesses still weaknesses? Have we developed other weaknesses?
Ch 9-16
Feasibility
Neither overtax resources or create unsolvable sub-problems
Ch 9-10
Strategy Evaluation, Review & Control
Advantage
Creation or maintenance of competitive advantage