QUESTION FIVE (20 MARKS)
Strategy evaluation is vital to the well-being of an organisation because timely evaluations can alert management to problems or potential problems before a situation becomes critical.
Critically examine the stages of strategy evaluation framework. (20)
The stages of strategy evaluation framework are critical for assessing the effectiveness and efficiency of the strategies implemented by an organization. These stages allow management to evaluate their current strategies and make necessary adjustments to achieve organizational goals. Here is a critical examination of these stages:
1. Setting strategic objectives: This stage involves establishing clear and specific objectives that the organization aims to achieve. These objectives must be aligned with the overall mission and vision of the organization. Critically evaluating the objectives ensures that they are realistic, measurable, and achievable.
2. Developing performance measures: Performance measures are tools used to monitor and evaluate the progress of strategic objectives. These measures should be relevant, measurable, and aligned with the organizational goals. Critically examining the performance measures ensures that they provide accurate information about the performance of strategies.
3. Collecting data: This stage involves collecting data related to the performance measures established in the previous stage. Data collection can be done through various methods such as surveys, interviews, or analysis of financial statements. Critical evaluation of data collection methods ensures that the information obtained is reliable and relevant to strategy evaluation.
4. Analyzing data: Once the data is collected, it needs to be analyzed to identify trends, patterns, and areas of improvement or concern. Critical evaluation of data analysis techniques helps in identifying any biases or limitations in the analysis, ensuring that the conclusions drawn from the data are accurate and reliable.
5. Comparing performance: This stage involves comparing the actual performance of the organization against the established strategic objectives and performance measures. Critical evaluation of the comparison process ensures that the performance measurements are comprehensive and reflect the true performance of the strategies implemented.
6. Identifying gaps: Based on the comparison of performance, any gaps between the desired objectives and actual performance are identified. Critical evaluation at this stage helps in identifying any weaknesses or shortcomings in the strategies and suggests potential areas for improvement.
7. Taking corrective actions: Once the gaps are identified, management needs to take corrective actions to address the shortcomings and improve performance. Critical evaluation of these corrective actions ensures that they are effective, feasible, and aligned with the overall strategy of the organization.
8. Monitoring and feedback: The final stage involves continuous monitoring of the performance measures and providing feedback to management. Critical evaluation of the monitoring process ensures that the feedback is timely, relevant, and encourages continuous improvement.
In conclusion, the stages of strategy evaluation framework play a vital role in assessing the effectiveness and efficiency of organizational strategies. Critical evaluation of each stage ensures that the process is comprehensive, accurate, and leads to informed decision-making for strategy improvement.