MZUMBE UNIVERSITY

(CHUO KIKUU MZUMBE)

(Mbeya Campus College)

PROGRAM: MBA IN CORPORATE MANAGEMENT

COURSE: STRATEGIC MANAGEMENT
SUBJECT CODE: BUS 5204
LECTURER: DR. PACHO
NATURE OF THE WORK: TERM PAPER
DATE OF SUBMISSION: 21st JUNE 2021
STUDENT’S NAME: JENIPHA GOTHALFEN MALYA
REGISTRATION NUMBER: 2647060/T.20
QUESTIONS:

1. Why has strategy evaluation become so important in business today?

2. As owner of a local, independent supermarket, explain how you would

evaluate the firm’s strategy?

3. Under what conditions are corrective actions not required in the strategy-
evaluation process?

4. Do you believe strategic management is more an art or a science? Explain

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 TABLE OF CONTENTS
QUESTION ONE....................................................................................................................3
QUESTION TWO...................................................................................................................5
QUESTION THREE...............................................................................................................7
QUESTION FOUR.................................................................................................................8
REFERENCE........................................................................................................................10

QUESTION ONE

Strategy evaluation refers to tool for assessing how well your business has performed,
relative to its goals. It's an important way to reflect on achievements and shortcomings,
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and is also useful for reexamining the goals themselves, which may have been set at a
different time, under different circumstances.

The strategy evaluation process involves answering questions such as: How much progress
have we made towards our Vision? Which of our Objectives have we completed? Which
Objectives are no longer needed? Where we fell short of our targets, why did this happen?.

It is important for an organization to evaluate the strategy twice a year or every quarter in
order knows the current position of the organization and what went wrong. The following
are the importance of strategy evaluation in today’s business because:

i. Internal and external factors often change quickly and dramatically, It is

important for an organization to evaluate strategy because business environment is
not static is dynamic, For instance technology is changing very fast.

ii. Is used as a tool for benchmark with other business players. The evaluation is
used to compare performance with competitor’s example on the Bank sectors
(CRDB and NMB Bank) or compares performance to business standards, compares
performance among or the same industries or departments and compares
performance between strategies.

iii. It enables the management to make sure that the business is heading in the
right direction and that corrective action is taken where needed. Hence, there is
the need for business management to continuously evaluate its strategies against
performance so that any indication that the business is failing to achieve its
objectives calls for corrective adjustments.

iv. Is used to establish a step by step guideline on future actions based on learning
from the past and the environment. These help a business to set the appropriate
objectives and guidelines on how to run the business and gain profit.

v. Strategy evaluation results helps in inspiring and motivating employee, as it

enables employees measure their performance, helps employees in determining the
nature of adjustments needed, helps employees relate their objectives to that of the
organization.

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vi. It facilitates business direction setting at it ensures compliance to organizational
vision, streamline operations to specific objectives, targets correcting strategic
directions and establishes common tactics and purpose.

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 QUESTION TWO

Strategy evaluation refers to the process of analyzing a business's strategic plan to

determine its performance against the goals set in the business strategy. It shows the
effectiveness and efficiency of a strategic plan in the achievement of the desired results.

The following are the two (2) criteria that I will take when evaluate the firm’s strategy so
that I can know how well a firm has performed;

1. Based on Quantitative criteria

In evaluate strategies under quantitative criteria is all about measuring of quantity, base
on financial ratios such as Return on investment (ROI), Return on equity (ROE), Profit
Margin, Sales growth and debt to equity ratio. These ratios are very important because it
help to compare the firm performance over different period, comparing the firm
performance to competitors, and compare the firm performance to industry averages.

2. Based on Qualitative Criteria

It focus on the judgment of the objectives or strategies that were been formed if have
been attained or not. There are various questions that may be considered when evaluate
strategies such as What are the relationship between firms key internal and external
strategic factors?, Is the strategy workable?.

Apart from the criteria of evaluate a firm strategy the following are the steps that I will
also take in evaluate strategies:

i. Review the underlying bases of a firm’s strategy: this involve analysis on the
internal factors such as organization management, productions and operations,
finance and accounting, information system and strength and weakness of the
firm. On the External factors such as opportunities and threats this represent the
bases of current strategies should continually be monitored for change. This
SWOT activity helps to build on what you do well, to address what the firm is
lacking, to minimize risks, and to take the greatest possible advantage of chances
for success.

ii. Measuring organizational performance: This activity involves comparing

expected to actual results, investigates variation from plans, evaluating individual
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 performance and examining progress being made toward meeting stated
objectives. For example a supermarket may make a comparison of the expected
sale of year 2020 with the actual sales results of half year 2020.Also this activity
may involve comparing the firm performance to competitors and performance of
industry averages.

iii. Taking correctives actions: This is another activity that I will evaluate firm
strategy thus means making changes to competitively reposition a firm for the
future if the firm is not satisfactory. Example changing an organization structure,
replacing one or more key individuals or may be revise a business mission,
policies or objectives. It will make a firm to immediately correct the issue and
identify how to prevent a recurrence and to achieve the stated objectives.

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 QUESTION THREE

Corrective actions is the activities taken to eliminate the cause of a process non-
conformity it’s all about reacting to a process problem, getting it under control through
containment actions, and then taking the action needed to stop it from happening again.

Example of the corrective actions in a firm may be:

i. Altering an organization structure

ii. Replacing one or more key individuals

iii. Revising business mission

iv. Revising Objectives

v. Developing new performance incentives

vi. Reallocating of resources

No organization can escape changes because a corrective action is necessary to keep a

firm on track toward achieving sated objectives. Strategy evaluation enhances an
organizations ability to adapt successfully to changing circumstances.

The conditions when corrective actions not required in the strategy-evaluation process as
follows:

a) Is when major changes have not occurred in the firm’s internal or external
strategic position that means there is proper allocation of resources,

b) When objectives are attainable and the firm is succeeding satisfactory towards
achieving its stated objectives and strategies

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QUESTION FOUR

Strategic Management refers to an art and science of formulating, implementing,

and evaluating cross-functional decisions that enable organization to achieve its
objectives.

It focuses on integrating management, marketing, finance, production and

process, research and development and information technology to achieve
organizational success.

Various literatures states that strategic management may be viewed more

as a science than an art based on (Fred R David, 2009):

i. Firms need to systematically assess their external and internal

environments, conduct research, carefully evaluate the advantage and
disadvantages of various alternatives, perform analyses, and then decide
upon a particular course of action.

ii. Strategic management integrates scientific characteristics and artistic

features.

Also states that strategic management may be viewed more as an art than a
science based on:

i. According to Mintzberg’s notion of strategies embodies the artistic

model, which suggests that strategic decision making be based primarily
on holistic thinking, intuition, creativity, and imagination.

ii. Is an art of combine knowledge together with a skill in tasks to attain

desired results it’s all about practice knowledge in which manager must
posses

iii. Creativity is important in an art. In the case of strategic management,

creativity is displayed in targeting to bring forth unique results by

combination of ideas and imagination.

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 iv. An art is goal oriented, whereby in strategic management efforts are directed

towards attainment of preset goals by utilizing available resources. Strategic

management is an art, which demands exercise of particular principles as it

deals with shaping the attitudes as well as behaviors of people.

Therefore, Strategic Management is both an art and a science its combines features
of both science as well as art. It is considered as a science because it has an
organized body of knowledge which contains certain universal truth. It is called an
art because managers require certain skills which are personal possessions of
managers. Science provides the knowledge & art deals with the application of
knowledge and skills.

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REFERENCE

BOOKS:

Fred R David: Strategic Management Concepts and Cases 12th edition (2009)
Pearson Education International

Fred R David: Strategic Management Concepts and Cases 13th edition (2011)
Pearson Education International

WEB SOURCE

https://ivypanda.com/essays/strategic-management-science-or-art Accessed on 13th

June 2021 20:23PM

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