STRATEGIC CONTROL AND CONTINUOUS
IMPROVEMENT
BY
SMART LEARNING WAY
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. In contrast to postaction control,
strategic control is concerned with guiding action in behalf of the strategy as
that action is taking place and when the end result is still several years off.
Managers responsible for the success of a strategy typically are concerned with
two sets of questions:
1. Are we moving in the proper direction?
2. How are we performing?
ESTABLISHING STRATEGIC CONTROLS
· Premise
Control:
Every strategy is based on certain planning
premises—assumptions or predictions. Premise control is designed to check
systematically and continuously whether the premises on which the strategy is
based are still valid. Key questions for management are:
· Which premises
should be monitored: environmental factors—those over which the firm has no
control but those that can influence strategy and industry factors—that
influence success in a particular industry.
· How are premise
controls enacted: the strategy’s key premises should be identified and recorded
during the planning process and responsibilities for monitoring those premises
should be assigned to those with qualified sources of information.
· 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.
· 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. The basic idea behind strategic surveillance is that
important yet unanticipated information may be uncovered by a general
monitoring of multiple information sources.
· Implementation
Control:
Implementation control is designed to assess whether the
overall strategy should be changed in light of results. Two types of
implementation controls are:
· Monitoring
strategic thrusts:
projects that need to be done if the strategy is to
be accomplished and information on the strategy’s progress.
· Milestone
reviews: critical events and resource allocations through time, and
full-scale assessment to scrutinize the strategy.
Implementation
control is also enabled through operational control systems like budgets,
schedules and key success factors. To be effective, operational control systems
must take four steps common to all potation controls:
· Set
standards of performance
· Measure
actual performance
· Identify
deviations from standards set
· Initiate
corrective action
The Quality Imperative: Continuous Improvement
TQM stands for total quality management, an umbrella term
for the quality programs that have been implemented in many businesses
worldwide in the last two decades.
TQM was first
implemented in several large U.S. manufacturers in the face of the overwhelming
success of Japanese and German competitors.
TQM is viewed as virtually a new organizational culture and
way of thinking.
It is built around an intense focus on customer
satisfaction; on accurate measurement of every critical variable in a
business’s operation; on continuous improvement of products, services, and
processes; and on work relationships based on trust and teamwork.
One useful explanation of the quality imperative suggests 10
essential elements of implementing TQM as follows:
1. Define quality and customer value.
2. Develop a customer orientation.
3. Focus on the company’s business processes.
4. Develop customer and supplier partnerships.
5. Take a preventive approach.
6. Adopt an error-free attitude.
7. Get the facts first.
8. Encourage every manager and employee to
participate.
9. Create an atmosphere of total involvement.
10. Strive for continuous improvement.
Six-Sigma Approach to Continuous Improvement
Sometimes referred to as the “new TQM,” Six-Sigma is a
highly rigorous and analytical approach to quality and continuous improvement
with an objective to improve profits through defect reduction, yield
improvement, improved customer satisfaction and best-in-class performance.
Critics of TQM see key success factors differentiating
Six-Sigma from TQM:
· Acute
understanding of customers and the product or service provided
· Emphasis on
the science of statistics and measurement
· Meticulous
and structured training development
· Strict and
project-focused methodologies
· Reinforcement
of the doctrine advocated by Juran such as top management support and
continuous education
ISO 9001 and
the Era of International Standards
The ISO 9001 quality management system standard, introduced
in 1987, is international in both scope and impact. The ISO 9001 standard focuses on achieving
customer satisfaction through continuous measurement, documentation,
assessment, and adjustment.
The standard specifies requirements for a quality management
system where an organization:
Needs to demonstrate its ability to consistently provide
product and services that meet customer requirements, and
Aims to enhance customer satisfaction through the effective
application of the system, including processes for continual improvement of the
system and the assurance of conformity to customer requirements.
The Balanced
Scorecard Methodology
Recognizing some of the weaknesses and vagueness of previous
implementation and control approaches, the balanced scorecard approach was
intended to provide a clear prescription as to what companies should measure in
order to “balance” the financial perspective in implementation and control of
strategic plans.
The balanced scorecard methodology adapts the TQM ideas of
customer-defined quality, continuous improvement, employee empowerment, and
measurement-based management/feedback into an expanded methodology that
includes traditional financial data and results.
BIBLIOGRAPHY
John A. Pearce II , Richard B Robinson , JR.,
Amita Mital “Strategic Management” 10th Addition Tata Mc Graw Hill
Education Pvt.Ltd New Delhi.
No comments:
Post a Comment