Lecture notes
Evaluating Strategic Options
- Module
- Business and Management
- Institution
- The University Of Kent (UKC)
Detailed explanation on evaluating strategic options.
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Evaluating Strategic OptionsIntroduction
The Challenge of Evaluation
Strategy evaluation calls for situation-based knowledge, high degree of insight and an understanding
of the following issues:
• Each business strategy is unique.
• Strategies are neither ‘wrong’ nor ‘right’ in an absolute sense.
• Evaluation is therefore highly dependent on the ‘situation’
Key Factors Influencing Decision-making
Techniques to Evaluate Options
• SAF
• RACES
Evaluating Strategic Options
Suitability Accessibility Feasibility (SAF)
• Sustainability: concerned with assessing which proposed strategies address the key issues
relating to the opportunities and constraints an organisation faces. To what extent and how
does it take advantage of opportunities, build on strengths or overcome threats and
weaknesses that may have been identified in understanding the strategic position of the
organisation?
• Acceptability: concerned with whether the expected performance outcome of a proposed
strategy meets the expectations of stakeholders.
, • Feasibility: concerned with whether a strategy could work in practice; in other words,
whether an organisation has or can obtain the capabilities to deliver a strategy.
SAF can be used to assess the viability of strategic options. In effect (i.e. basically) the criteria pose
the question as to why some strategies might succeed better than others.
Suitability
Suitability is concerned with assessing which proposed strategies address the key opportunities and
constraints an organisation faces through an understanding of the strategic position of an
organisation. It is therefore concerned with the overall rationale of a strategy. At the most basic
level, the need is to assess the extent to which a proposed strategy:
• Exploits the opportunities in the environment and avoids the threats
• Capitalises on the organisation’s strength and strategic capabilities and avoids or remedies
the weaknesses.
Examples of suitability in evaluating strategic options:
Acceptability
Acceptability is concerned with whether the expected performance outcomes of a proposed strategy
meet the expectations of stakeholders. These can of three types, the r’s:
• Risk: concerns the extent to which the outcomes of a strategy can be predicted. For
example, risk can be high for organisations with major long-term programmes of innovation,
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