| dc.description.abstract | Strategy is a multidimensional concept that has found application in the business
world. It is about winning. Many firms are embracing the utilization of strategic
management principles designed at achieving long-term organizational objectives.
Companies are investing a lot of resources in formulating and implementing
strategies. However, it is acknowledged that even the best formulated and
implemented strategies tend to become obsolete as a firm’s external and internal
environments change. In order to ensure that strategies provide desired results, it is
essential that strategists invest in systematic review, evaluation and control of strategy
execution.
This study investigated the strategy evaluation and control practices of pharmaceutical
manufacturers and distributors in Kenya. It also sought to determine the relationship
between these practises and other firm characteristics. A cross-sectional survey design
was used with a sample size of 60 pharmaceutical firms operating as manufacturers
and distributors. The study used a structured questionnaire to collect data. Majority
(83.4%) of respondents indicated strong appreciation of the importance of evaluating
and controlling strategies Consistency was considered by the majority of respondents
(47.7%) to be the most important factor among Rumelt’s strategy evaluation criteria
when deciding on strategies to be employed by their organizations.
Most respondents (60.0%) indicated that they reviewed their strategies on a periodic
basis i.e. quarterly, bi-annually or annually while 36.7% do so whenever need arises.
However, few firms (33.3%) make budgetary allocations for strategy evaluation and
control activities. Monitoring of financial performance was the most commonly used
method of strategy evaluation and control. All firms that participated in the survey
used some form of financial controls. The level of usage of techniques that
incorporate non-financial measures was quite low and in sharp contrast to the use of
financial measures. Management by Objectives (33.3%), audits (16.7%), balanced
score card (3.3%) and benchmarking (3.3%). There was no indication of the use of
contingency planning as a technique for controlling strategy implementation.
Monitoring financial performance was utilized by all firms regardless of age,
ownership, size and type. Using the Chi square test, relationships were identified to
exist between company type and various factors considered by firms when reviewing
the premises of strategy including changes in competitor’s strengths and weaknesses,
competitor’s reaction to an organization’s strategy, changes in competitor’s strengths
and weaknesses as well as competitors’ satisfaction with their present market
positions and profitability . | en |
