2. Chapter 13 Strategic Control McGraw-Hill/Irwin
Copyright © 2009 by the McGraw-Hill Companies, Inc. All rights reserved.

3. Learning Objectives
Describe and illustrate four types of strategic control.
Summarize the balanced scorecard approach and how it integrates strategic and operational control.
Illustrate the use of controls to guide and monitor strategy implementation.
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4. Establishing Strategic Controls
Strategic control is concerned with tracking a strategy as it is being implemented, detecting problems or changes in its underlying premises, and making necessary adjustments
Characterized as a form of “steering control”
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5. Types of Strategic Control
Premise control
Strategic surveillance
Special alert control
Implementation control
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6. Characteristics of the Four Types of Strategic Control
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7. Premise Control
Premise control is designed to check systematically and continuously whether the premises on which the strategy is based are still valid
Environmental factors
Industry factors
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8. Strategic Surveillance
Strategic surveillance is designed to monitor a broad range of events inside and outside the firm that are likely to affect the course of its strategy
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9. Special Alert Control
A special alert control is the thorough, and often rapid, reconsideration of the firm’s strategy because of a sudden, unexpected event
Contingency plans
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10. Implementation Control
Strategy implementation takes place as series of steps, programs, investments, and moves that occur over an extended time
Implementation control is designed to assess whether the overall strategy should be changed in light of the results associated with the incremental actions that implement the overall strategy
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11. Balanced Scorecard Methodology
An alternative approach linking operational and strategic control, developed by Harvard Business School professors Robert Kaplan and David Norton, is a system they names the balanced scorecard
The balanced scorecard is a management system (not only a measurement system) that enables companies to clarify their strategies, translate them into action, and provide meaningful feedback
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12. Balanced Scorecard Four perspectives:
The learning and growth perspective: How well are we continuously improving and creating value?
The business process perspective: What are our core competencies and areas of operational excellence?
The customer perspective: How satisfied are our customers?
The financial perspective:
How are we doing for our shareholders?
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