Operations Management and Strategic Management · Formulation and Implementation of Strategy

Strategic Evaluation and Control for CMA Intermediate

Updated 10 October 2026 · Fact-checked

Strategic evaluation and control checks whether a firm's strategy is working and takes corrective action if it is not. You set standards from strategic goals, measure actual performance, compare the two, find the reasons for gaps, and then correct the action or revise the strategy. The balanced scorecard is a common tool.

Understand Strategic Evaluation and Control

A strategy is only a plan until you check what it delivers. Strategic evaluation and control is the last stage of the strategic management process. It asks one question: are we moving towards our objectives, and are our strategic assumptions still true?

The two words have different jobs. Evaluation is judging: how good is the strategy and how well is it performing? Control is acting: using that judgement to keep the organisation on course, or to change the course.

Strategic control is different from operational control. Strategic control looks at the long term, asks whether the strategy itself is right, deals with uncertain external and internal changes, and is done by top management. Operational control looks at short-term, routine results such as cost, output or schedule, asks whether the work is done as planned, and is done by middle and lower management.

Common forms of strategic control, in plain words:
- Premise control: checks whether the assumptions behind the strategy (for example, growth in demand or stable policy) still hold.
- Implementation control: checks whether the strategy is being carried out through milestones and key projects, and whether resources are being used as planned.
- Strategic surveillance: a wide, loose watch on events inside and outside the firm that may affect the strategy.
- Special alert control: a quick, focused review triggered by a sudden event, such as a policy change or a major competitor move.

The balanced scorecard (Kaplan and Norton) stops a firm from judging itself on financial results alone. It translates strategy into measures across four perspectives: financial, customer, internal business process, and learning and growth. Learning and growth measures are usually the drivers of the other three, so they act as leading indicators, while financial results are lagging indicators.

Key rules to remember

Four perspectives of the balanced scorecard: Financial + Customer + Internal Business Process + Learning and Growth; Remember the questions: how do we look to shareholders, how do customers see us, what must we excel at, can we keep improving and creating value.
Strategic control process: Set standards → Measure actual performance → Compare → Analyse deviations → Take corrective action; Write the steps in this order. Corrective action may change the action, the standard or the strategy itself.
Deviation: Deviation = Actual performance − Standard (target); Say whether it is favourable or adverse, and state the cause. For cost measures, actual above standard is adverse.

How to solve Strategic Evaluation and Control questions

Use this method for any theory, case or short-note question on strategic evaluation and control.

1Define the term in one or two lines: evaluation judges, control acts, and both close the strategic management loop.
2State the purpose: check progress to goals, test assumptions, and enable timely correction.
3Give the process in order: set standards, measure, compare, analyse deviation, take corrective action.
4Name the type of control the question needs (premise, implementation, surveillance, special alert) and explain it with a short example.
5If the question mentions the scorecard, list the four perspectives with one measure each and show how they link to strategy.
6If asked to distinguish strategic from operational control, use a two-column comparison on time, focus, level, nature and uncertainty.
7Apply the point to the case given: name the deviation, its likely cause and the corrective action.
8Close with a one-line conclusion, such as the need for continuous feedback that improves the next strategy cycle.

Quickest way: Four-line recall for strategic control answers

When to use it: Use when you have about five minutes for a 4 to 7 mark theory question and need a safe structure.

Write what it is and why it matters in two lines.
List the five process steps as short numbered points.
Add one example from the question's industry, with a measure and a target.
Finish with the balanced scorecard perspectives or the strategic versus operational point, whichever the question hints at.

Common mistakes in Strategic Evaluation and Control

Treating strategic control as the same as operational control.
Both involve comparing actual with standard, so they look alike.
Fix: State the difference: strategic control tests the strategy and its assumptions over the long term at top level, while operational control checks routine short-term work.
Naming the balanced scorecard perspectives wrongly, such as adding 'employee' or 'competitor'.
Students recall the idea but not the exact labels.
Fix: Memorise: Financial, Customer, Internal Business Process, Learning and Growth. Put people measures under Learning and Growth.
Listing only financial measures for the scorecard.
Financial ratios are the most familiar measures.
Fix: Give at least one non-financial measure for each non-financial perspective, such as customer retention, defect rate or training hours.
Ending the process at comparison and leaving out corrective action.
Students treat evaluation as only measuring.
Fix: Always add the final step: correct performance, revise standards or change the strategy, and feed the lesson back into planning.
Not explaining the types of strategic control, or mixing up premise and implementation control.
The names sound similar.
Fix: Premise control tests assumptions about the environment. Implementation control tests progress of the actions and milestones.

Worked examples

Example 1

Explain the process of strategic control and show how a firm that planned a 12% rise in market share in a year but achieved 8% should respond.

Show the solution

Set standards: the target is a 12% rise in market share, with milestones for each quarter.
Measure performance: actual rise is 8%.
Compare: Deviation = 8% − 12% = −4 percentage points, which is adverse.
Analyse causes: check whether the shortfall is due to weak execution (distribution gaps, poor promotion) or to a wrong premise (a competitor's price cut, slower market demand).
Take corrective action: if execution is the cause, fix the distribution and sales effort. If a premise has failed, revise the target or the strategy.
Feed back: record the learning and update the next plan and standards.

Answer: Strategic control follows five steps: set standards, measure, compare, analyse deviations and take corrective action. Here the deviation is 4 percentage points adverse (8% against 12%). The firm should find the cause, correct execution if that is at fault, or revise the strategy or target if its premises have failed.

Example 2

A private hospital chain wants to monitor its strategy of becoming the most trusted provider in its region. Suggest one measure for each balanced scorecard perspective.

Show the solution

Financial: operating margin per bed, or return on capital employed, shows whether the strategy creates value for owners.
Customer: patient satisfaction score or patient referral rate shows whether patients see the hospital as trusted.
Internal business process: average patient waiting time or hospital-acquired infection rate shows the quality of key processes.
Learning and growth: training hours per nurse and doctor, or staff retention rate, shows the capability to keep improving.
Link the four: better trained staff improve processes, better processes raise patient satisfaction, and satisfied patients improve financial results.

Answer: Financial: operating margin per bed. Customer: patient satisfaction score. Internal business process: average waiting time. Learning and growth: training hours per clinician. The measures are linked in a cause-and-effect chain from capability to financial results.

Exam tips

Questions often ask for a distinction between strategic and operational control. Use a table-like pair of points on time horizon, level, focus and nature, and give at least four points.
For the balanced scorecard, always name all four perspectives and add one example measure for each. Partial lists lose marks.
In case-based questions, name the type of control (premise, implementation, surveillance or special alert) that fits the facts, and then suggest the corrective action.
Do not skip the corrective action step. Examiners look for the feedback loop that ends the process.
In MCQs, remember that learning and growth is the perspective that drives the others, and that strategic control tests assumptions as well as results.

Practice questions from Formulation and Implementation of Strategy

Strategic Evaluation and Control in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Strategic Evaluation and Control: frequently asked questions

What is the difference between strategic control and operational control?

Strategic control is long-term, done by top management, and checks whether the strategy and its assumptions are still right. Operational control is short-term, done by middle and lower management, and checks whether routine tasks meet plans and standards.

What are the four perspectives of the balanced scorecard?

They are the financial, customer, internal business process, and learning and growth perspectives. Together they give a view of performance beyond financial results and link measures to strategy.

What are the steps in the process of strategic control?

Set performance standards from strategic goals, measure actual performance, compare it with the standards, analyse the deviations and their causes, and take corrective action. The result is fed back into the next round of planning.

What is premise control?

Premise control checks whether the assumptions on which the strategy was built still hold, such as expected demand, costs or government policy. If a key premise fails, the strategy may need to be changed.