STRATEGIC CONTROL AND CONTINUOUS IMPROVEMENT




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.




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