Taranenko A. V., Full Professor, Doctor of Economic Sciences Grynko T. V.
Oles Honchar Dnipropetrovsk National University (Ukrainian)
SCIENTIFIC AND METHODICAL APPROACHES TO THE EVALUATION OF THE EFFECTIVENESS OF THE ECONOMIC STRATEGY OF THE ENTERPRISE
In the conditions of tough competition and rapidly changing situation, firms should not only concentrate attention on the State of affairs, but also to produce a long-term strategy, which allowed them to keep the changes that occur in their environment. Therefore, the company needs to choose an effective strategy for economic development. The urgency is expressed in the selection line of scientific-methodological approaches that should be used for estimation of efficiency of economic strategy to improve the efficiency of the company.
Evaluation strategy is the final step in strategic planning and progress at all stages of the implementation of the strategy. It can be done in two ways:
– evaluation of specific strategic choices to determine their suitability, feasibility, acceptability and consistency to the organization;
– comparison of results of implementing the strategy to the level of achievement.
An effective evaluation system requires key basic elements:
1. Motivation for evaluation. Before evaluation can be carried out, the head of the Organization should have a desire to evaluate their performance or strategy, which he or his team want to implement. Such a desire is conditioned by the realization that it is necessary to achieve conformity between the Organization and the proposed strategy. There are other potential motivating factor, if the manager is hoping to receive a reward based on performance according to the task .
2. Information for evaluation. Another requirement of reliability assessment information in usable form to evaluate proposed strategies, as well as its consequences after implementation. This requires an effective system of collection and processing of management information, as well as a complete and accurate report on the possible outcomes of the proposed strategies and results of their implementation .
3. Evaluation Criteria. Strategies should be evaluated according to certain criteria. These criteria can be grouped as follows:
– Sequence of implementation strategies. The strategy defined the purpose of the upper level, so it should not contain inconsistent with the upper level lower level objectives.
– Compliance with the requirements of the environment. The strategy should match the atmosphere and place it critical changes.
– Feasibility strategy. The strategy should neither overestimate the available resources nor create problems not solved in the future.
– Acceptability to stakeholders. The strategy should meet the expectations of specific support groups.
– An advantage relative to competitors. The strategy must ensure the creation or maintenance of competitive advantage in their chosen field .
4. The decision of the evaluation strategy. Evaluation itself is not the final stage. It should guide decisions about the choice of strategy and contribute to the definition of its effectiveness. For this is developed appropriate corrective action system, based on an assessment of the information presented .
In today's rapidly changing conditions of the environment and the internal capabilities of the company's evaluation of the effectiveness of the chosen strategy is the most important part of the process of strategic management. This step turns it into a closed loop sequential continuous process .
To assess the real strategy of the company, you should first determine what is the chosen strategy. That the company's approach to the conduct of competition – committed to it to reach a minimum in a given field of production costs or focuses its attention on a specific group of consumers and market niches in order to break from their pursuers. Another important point is to determine the competitive position of firms in the field of goods and services, the degree of its vertical integration and territorial coverage. It should also identify and analyze functional supporting strategies in the areas of production, marketing, finance, human resources and so on. A thorough study of incentive motives for each plot strategy – each step and each of the functional approach is also making clear disclosure of the essence of the current strategy.
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