Structural Considerations in Strategic

Implementation
Before implementing a new or revised strategy, company leaders must ensure the
organizational structure can support the planned activities. After identifying the tasks that the
company must perform well to succeed, company executives configure organizational
hierarchies to support primary strategic goals and achieve competitive advantages. They
also identify areas of weakness that pose risks and devise techniques for handling crises.
Successful strategic implementation depends on structuring the organization’s employees so
they can most effectively use the tools and resources available to create quality products
and services.

Structuring Activities
To prevent their staff from spending time on activities not directly related to achieving
companies' strategic goals, managers identify tasks that can be outsourced to third-party
vendors. Structuring work this way allows experts to perform these jobs, typically at a lower
cast, while employees focus on their core competencies supporting main businesses. For
example, computer manufacturers typically outsource assembly while focusing internally on
design, sales and distribution duties.

Aligning Functions to Strategic Objectives

Before corporate leaders can implement new strategyies, they need to ensure that all
personnel in the organizational structure possess the necessary skills, knowledge and
resources to accomplish the tasks. Work must flow from one function to another so leaders
should establish clear processes with policies and procedures that define roles and
responsibilities. The strategy must be consistent across all departments, adaptive to
changes, competitively advantageous and technically feasible

Establishing Authority
Successfully implementing a new strategy requires that managers and employees
understand what activities require executive approval and which decisions employees have
the empowerment to make without further approval. Ideally, decision makers should be
those people who are closest to the situation and most knowledgeable about the impact. By
avoiding micro-managing the organization, managers streamline operations and eliminate
wasteful tasks. If the organization is structured to allow employees the flexibility to make
critical decisions, they must also be held accountable for their actions.

Developing Partnerships
Strategic implementations require personnel to work together to achieve specific,
measurable, attainable, relevant and time-constrained goals and objectives. Establishing a
common balanced scorecard prevents groups from competing against each other to
succeed individually at the expense of the whole company. If company executives foster a
cooperative environment between departments, managers share resources, personnel and
knowledge effectively. Additionally, the organizational structure should encourage new
employees to seek out coaching and mentoring from corporate executives. By encouraging
learning and development, company leaders establish a framework for sustainable growth.
The Types of Obstacles Faced in a Strategic Evaluation

Strategy evaluation is the final stage in the ongoing process of strategic management. The process
entails determining the areas of the strategic plan to measure after strategy implementation, and
setting benchmarks for measurement. The strategist or manager in charge then compares the
anticipated results of the strategic plan and the actual results and makes recommendations.
Through strategic evaluation, an organization determines whether it is in compliance with its
business goals and objectives.

Corrective Action

It is not uncommon for organizations to change their strategic plans during evaluation. This is corrective

action. Yet sometimes the organization must undertake corrective action which completely overhauls the

entire strategic plan. This means that people evaluating the strategy have to lower the standards or

benchmarks of the strategy. Lowering the standards has the implication of reformulating the strategic plan,

its goals and objectives. This requires more resources and time.

Lack of Cooperation

Strategy evaluation, like strategy implementation, requires the cooperation and participation of

management and personnel. Unfortunately strategy evaluation, being the final stage of strategy

management, is often overlooked. One of the reasons that management and staff may not take strategy

evaluation seriously is because they perceive it as time consuming. Strategists thus face the challenge of

emphasizing the importance of evaluation to determine if the organization has met its strategic goals.

Measurement

One of the tasks in strategy evaluation is measuring the results of strategy implementation. Maintaining objectivity in

assessing and measuring the results of strategic plans is a major challenge. Although strategists use evaluation tools

such as financial statements, questionnaires and interviews, some concepts such as manager opinions or contributions

are difficult to measure. If the right tools for measuring are available, then the process of strategic evaluation becomes

simpler. Lack of appropriate measuring tools slows down strategic evaluation.

Reporting

Strategy evaluations have some similarity with audit reports, which can deliver bad news sometimes. Strategists face

the challenge of presenting an honest report of the progress of the strategic plan. As in methods of measuring results,

objectivity is also a challenge during the reporting of these results. Inevitably not all personnel or stakeholders will

agree with the findings of the strategy report. Strategists therefore face the task of presenting a fair report and one

which does not trigger organizational conflict.

Strategic evaluation and control

Strategic evaluation and control is the process of

determining the effectiveness of a given strategy in achieving the organizational
objectives and taking corrective actions whenever required.

Control can be exercised through formulation of contingency strategies and a

crisis management team. There can be the following types of control –

(i) Operational control- It is aimed at allocation and use of organizational

resources through evaluation of performance of organizational units, divisions,
SBU`s to assess their contribution in achieving organizational objectives.

(ii) Strategic control- It takes into account the changing assumptions that
determine a strategy, continually evaluate the strategy as it is being
implemented and take the necessary steps to adjust the strategy to the new
requirements.

The four basic type of strategic control are-

1. Premise control- It identifies the key assumptions and keeps track of any
change in them to assess its impact on strategy and implementation. The goal is
to find if the assumptions are still valid or not .It is generally handled by the
corporate planning staff considering the environmental and organizational
factors.

2. Implementation control- It includes evaluating plans, programs, projects, to

see if they guide the organization to achieve predetermined organizational
objectives or not. It leads to strategic rethinking .It consists of identification and
monitoring of strategic thrusts.

3. Strategic surveillance- It aims at generalized control. It is designed to

monitor a broad range of events inside and outside the organization that are
likely to threaten the course of the firm. Organizational learning and knowledge
management systems capture the information for strategic surveillance.
4. Special Alert control- It is a rapid response or immediate reassessment of
strategy in the light of sudden and unexpected events. It can be exercised
through formulation of contingency strategies and a crisis management team.

Strategic Evaluation Process-

(A) Setting standards of performance – It must focus on questions like:

 What standards should be set?

 How should the standards be set?
 In what terms should these standards be expressed?

The firm must identify the areas of operational efficiency in terms of people,
processes, productivity and pace. Standards set must be related to key
management tasks. The special requirement for performance of these task must
be studied. It can be expresses in terms of performance indicators.

The criteria for setting standards may be qualitative or quantitative. Therefore

standards can be set keeping in mind past achievements, compare performance
with industry average or major competitors. Factors such as capabilities of a
firm, core competencies, risk bearing ability, strategic clarity and flexibility and
workability must also be considered.

(B) Measurement of performance – Standards of performance act as a

benchmark in evaluating the actual performance. Operationally it is done
through accounting, reporting and communication system. The key areas which
must be kept in mind are – difficulty in measurement, timing of measurement
(critical points) and periodicity in measurement (task schedule).

(C) Analyzing variances – The two main tasks are noting deviations and
finding the cause of deviations.
♦ When actual performance is equal to budgeted performance tolerance limits
must be set.

♦ When actual performance is greater than budgeted performance one must

check the validity of standards and efficiency of management.

♦ When actual performance is less than budgeted performance we must pinpoint

the areas where performance is low and take corrective action,

The cause of deviations may be – External or internal, Random or expected,

Temporary or permanent. The two main questions to focus upon are :
Are the strategies still valid?

Does the organization have the capacity to respond to the changes needed?

(D) Taking corrective actions – It consists of the following-

♦ Checking of performance – It includes in-depth analysis and diagnosis of the

factors that might be responsible for bad performance.

♦ Checking of standards – It results in lowering or elevation of standards

according to the conditions.

♦ Reformulate strategies, plans, objectives – Giving a fresh start to the

strategic management process

Importance of Strategic evaluation and control

 There is a need for feedback ,appraisal and reward

 to check on the validity of strategic choice
 Congruence between decisions and intended strategy
 Creating inputs for new strategic planning