Strategic Control refers to the activity of analysis and surveillance of the Strategic Planning. Its main objective is to monitor and implement corrective measures when facing any kind of deviation in the original Strategy, after comparing it with the Strategic Standards, and thus granting the good-riddance of the company´s targets. It works through the establishment of reference points, rules, methods and devices that allow to measure the development efficiency and effectiveness of the Strategy in whatever concerns seizing its goals, and also allows a better comprehension of the periods of crisis
In other words, Strategic Control seeks to provide an answer to the following issues: 1. Whether the Strategy is being implemented as planned. Any possible failure in a company achieving its goals might be due to wrong performance from Operational and/or managerial personnel. The responsibility of regulating and correcting possible deviations in the course of the strategy.
2. If targets continue being valid. It is, Strategic Control is in charge of spotting any alteration in the behavior of external forces, and uncontrollable environment that require a change in the Corporative targets. Since environment is submitted to constant change, Opportunities and risks may arise that weren’t acknowledged when the original Corporative Strategy was conceived, and thus, the pertinent measures weren´t taken. For instance, a certain company provides a country with its products, but, all of a sudden, inner armed conflicts spark in that country, rendering it instable and dangerous. Under that conditions, the company might reconsider if it is still worth trading with this country, or perhaps it may regard abandoning transactions with it, thus, modifying its original targets.
3. Whether Outcomes of the Strategy are the expected or not. It means that Strategic Control also needs to verify whether the Strategy has been properly raised. Managerial and Operational personnel may have properly fulfilled their tasks to whatever concerns to the Strategy, but it may not have produced the desired outcomes. This might be due to the fact that the Strategy is not properly formulated. Strategic Control is in charge of re-formulating it so as to eventually achieve desired goals.
Unlike conventional ways of Organizational Control, Strategic Control operates “a Posteriori”, which means that it is focused on the events that have already taken place, identifying past mistakes, and distributing responsibilities. Under no circumstances this kind of Control seeks to recover losses, but rather to acknowledge them, note them down, and develop the pertinent mechanisms to avoid them in future operations. This way of operating, nevertheless, may render negative repercussions on the very own internal engine of the enterprise. The tight surveillance exerted by those in charge of applying this Strategic Control, strictly girded to stiff itineraries generates a feeling of insecurity and fear within the staff. Another negative “side-effect” of Strategic Control is that the exhaustive scrutiny to which the company´s operations are subjected leads to a slower pace.
The process of Strategic Control is subdivided into 3 steps: 1st: Measuring the performance of the Organization:
Before Business managers can take any action concerning the future of the Enterprise, they need to dispose of any measure of its current performance. They perform so via the so-called Strategic Audit. This Audit consists in a series of exams that intend to evaluate the whole range of operations within any organizations which undergo a process of Strategic Planning. Its main target is to promote the development and integration of interrelated functions. It is, to ultimately enhance the enterprise´s productivity. Its function is clearly represented in the following graphic, in which “t” stands for the variable “Time”. Strategic Audit...