Strategic Control Process

Although the control system must be made in accordance with the specific situation, but the control system to follow the same basic process, usually following the six langakah as follows:• Determine what the controlled• Setting standards• Measure performance• Compare performance with the standard• Determining the reasons for the deviation• Perform corrective actionFeedback from evaluation of the effectiveness of the strategy may affect the other phases in the strategic management process. The system is designed well pengendalianya will include feedback from the control information to individuals or groups who form a controlled activity. A simple feedback system measures the output of the process and makes the input of corrective action to obtain the desired output. The consequences of the use of feedback control system is that the sustainability performance is not satisfactory until the error function is found. One technique to reduce the problems associated with feedback control is to control the feed to the front. Feed forward system to monitor the input into a process to determine whether the input according to plan, otherwise it might process the input or modified to obtain the desired results.The second step in the process of building control is standard. Standard control is a target against which performance will be compared. Standards are criteria that allow managers to evaluate past actions, present and future. Standards are measured in various ways, including physical form, quantitative and qualitative. Five aspects of performance can be managed and controlled, the quantity, quality, time, cost, and behavior. Each aspect of control, may require additional grouping. General Electric uses eight kinds of standard, the standard profitability, market position standards, productivity standards, standards of product leadership, human resource development standards, standards of employee attitudes and standards of public accountability.The third step is to measure performance. Actual performance should be compared with the standard. In some places, these steps may be needed only for visual observation. In other situations, a rigorous determination is required. Many kinds of measurements to a control function based on some standard forms historically. For example, the standard is based on data derived from the program PIMS (profit impact of market strategy), inform that aired publicly available, for example, ratings of product / service quality, innovation rates, and relative market shares standings. PIMS was developed by Sidney Shoeffler from Harvard University in the 1960s. Other traditional size performance is Return on Investment (ROI), which not many distinguished by Return on Assets (ROA), ie the quotient between net income before taxes by total assets. Other traditional size is Return on Equity (ROE) and Earning per Share (EPS). Methods of measuring corporate performance and popular division is Economic Value Added (EVA), which represents the difference between the value of a business before and after the strategy implemented. EVA is what ultimately replace the ROI. The value will come from the EVA is MVA or Market Value Added, which represents the difference between the market value of the company and kotribusi capital from shareholders and lenders. Companies like General Electric, Microsoft, Intel, Coca-Cola mepunyai MVA high. Strategic control standards are based on the practice of competitive benchmarking (peg expected to compete), a process performance measurement is compared to the best performing companies in the industry. The company that pioneered benchmarking in the United States is Xerox. Most companies are admired the world benchmark for products and services they produce.The fourth step is to compare actual performance with standards. If the previous steps have been going well, then compare the performance with the standard will become easier. Although, sometimes comparing the performance with this standard is difficult to make the necessary comparisons, such as standards of behavior. Some deviation from standard can be justified, because of changing environmental conditions and other reasons.The fifth step of controlling the process involves extracting "why menyipang performance of the standard?". Since deviations can be shifted toward the goals of the organization selected. Primarily, organizations need to look for irregularities that come from both internal and external changes in the control of the organization. In general, as a guide to help can be viewed as follows:• What is the standard in accordance with the statement of strategy and objectives?• Are the goals and strategies are still appropriate in the current environmental situation?• Does the organizational structure, leadership, staff skills and systems in accordance with the implementation of a successful strategy?• Are the activities implemented in accordance with the standards of achievement?Point the cause, both internally and externally has different implications for a variety act of correction.The next step in the process of control is to determine the need for corrective action.Managers can choose from three things:• Not doing anything• Implement revised standards• Conduct actual performance correctionNot doing anything can be done if the performance is assured in accordance with the standards. If the standard is not appropriate, then the manager should carefully assess the reasons why and take corrective action. Moreover, the need for a standard check periodically to ensure that standards and linked to performance measures are still relevant for the future. Finally, managers must decide on actions to correct performance, if any wrongdoing. Corrective action depends on the discovery of irregularities and the ability to take an act of critical need. Often the real case the deviation must be found before the corrective action will be taken. Because penyimpenyimpangan shifted from an unrealistic target to the wrong strategy.