Performans yönetimi için dinamik bir stratejik kontrol modeli
A Dynamic strategic control model for performance management
Yazar: SEÇKİN POLAT
Danışman: PROF. DR. MEHMET HALUK ERKUT
İstanbul Teknik Üniversitesi / Fen Bilimleri Enstitüsü
Derece: Doktora, 1992
Konu: Endüstri ve Endüstri Mühendisliği = Industrial and Industrial Engineering
Dizin: Performans analizi = Performance analysis ; Performans yönetimi = Performance management ; Stratejik kontrol = Strategic control ; Yönetim = Management

Özet:
ÖZET Bu çalışmanın amacı organizasyonların performanslarını yönetmek için stratejik kontrolü nasıl yaptıklarını, ne tür yaklaşım ve modelleri kullandıklarını literatür araştırması ile incelemek ve bu konuda yeni bir sayısal model geliştirmektir. Bu amaca ulaşmak için yapılan çalışmalar altı bölüm altında toplanmıştır. Birinci bölüm giriş olup stratejik yönetim ve bu konudaki çalışmaların ve gelişmelerin genel çerçevesi çizilmiştir. İkinci. bölümde, temel kavramlar olan yönetim, planlama, kont rol, organizasyonel yapılar ve sistem düşüncesi incelenmiştir. Üçüncü bölüm stratejik yönetim süreci ile ilgilidir. Strateji kavramı, strateji modelleri ve stratejik yönetim süreçleri incelenmiştir. Bu süreçler stratejik planlama esaslı stratejik yönetim süreci ile stratejik konu esaslı stratejik yönetim sürecidir. Dördüncü bölümde tez çalışmasının ana konusu olan stratejik kontrolün tanımı, çeşitleri, stratejik kontrol için kullanılan yaklaşım ve modeller incelenmiştir. Beşinci bölüm performans analizine ayrılmıştır. Performans kavramının teorik çerçevesi incelenmiş ve performansı tanımlamak için hangi yaklaşımların olduğu saptanmaya çalışılmıştır. Organizasyonların stratejik seviyede performansını analiz etmek için kullanılan kriterler saptanmıştır. Performans kontrolün önemli bile şenlerinden olan performans standartlarının nasıl oluşturulduğu analiz edilmiştir. Performans kontrolü için geliştirilmiş bulunan modeller bu bölümde incelenmiştir. Altıncı bölüm, bu çalışmanın özgün kısmı olan geliştirilen modeli içerir. Geliştirilen modelin genel yapısı ve hangi varsayımlar altında kurulduğu açıklanmıştır. Modelin alt modelleri olan sistem dinamiği ve kontrol diyagramı modeli tanıtılmış ve modelin bir işletmeden alınan değerlerle çalışma sonuçları verilmiştir. Yedinci bölüm çalışmanın sonuçlarına aittir. Çalışma sonuçları, çalışmanın özgünlüğüne ait sonuçlar ve yapılan literatür araştırmasından çıkarılabilen kavramsal sonuçlar olmak üzere iki ana grupta incelenmiştir. Ayrıca gelecek çalışmalar için iki öneride bulunulmuştur. XVİ

Abstract:
SUMMARY A DYNAMIC STRATEGIC CONTROL MODEL FOR PERFORMANCE MANAGEMENT The Purpose of the thesis is to develope a dynamic model of strategic control for an organizational unit which is a firm pro ducing consumer products. Conceptually performance of an organizational unit is salt to be function of the strategy which the unit pursues, and the environ ment "in which the unit operates. Based on the above facts it can be said that managing performance is realized by means of strategic control. In literature quantative model for strategic control is very scarce. This led to this research. The thesis is divided into seven parts. The first part is intro duction. The second part is devoted to general management concepts such as managerial work, managerial planning, management control and organizational structure and system concepts. Strategy management processes which include strategy concepts, strategic planning and implementation of strategy is examined in the third part. Although strategic control is a part of strategic management processes, it is examined seperately in the fourth part, because of its importance to the research. Strategic control types, models and approach for strategic control and mode of strategic control is examined in the part of strategic control. The fifth part is concerned with per formance analysis of an organizational unit. In this part approac hes to performance, performance criteria and standarts, models for performance control are examined,, in detail. The sixth part is devoted to the model which is developed in this thesis. Firstly, theorical backgraund, scape and assumptions of the model are constructed in the sixth. Because the model consists of two sub models; namely system dynamics model and control model, each model is made available in the part. The last part is on the conclusions drawn from the research. Each part is summarized below. Management involves the coordination of human and materials resources accDmplisment of the objectives. Typical definitions suggest that management is a process of planning, executing and contoling activites. There are three management level: strategic, tactical and operational management. Strategic management is charged with ensuring that the organization serves it mission in a effective way, and also it serves the needs of those people who control or otherwise have power over the organization. Tactical management joint the operational management to the strategic management, transtate the strategic plans into tactical plans and ensure that operational management is doing their jobs in effective way. Operational management is charged whit doing their jobs to arrive at goals set by top management planning is deciding in advance xviiwhat to do, how to do it, when to do it, and who is to do it. There are three kind of plana; strategic plans, tactical plans and operational plans. Control is generally recognized as fundemental management activity, but historically control issues have received only cursory attention in literature. Traditional management cont rol system is output-oriented. Employing this system, management specifies some desired output level for subordinate, monitors the extent to which each is on or off course, and takes corrective action when significant deviations from expectations arise. Two broad classes of control can be identified; formal and informal. Two broad classes of control are decomposed into three formal and informal control mechanisms. The three formal controls are distin guishable from others by the timing of management intervention. Input control are measurements taken by the firm prior to implemen tation criteria, recruitment and training programs, manpower allot ments. Process control is exercised when the. firm attemps to inflUEtice the means to achiwe desired ends. It differs from output control in that the focus is on behaviour and/or activities rather than the end results. Output control is exercised when performance standarts are set, monitored and the results evaluated. Informal controls are the unwritten, typicall worker-based mechanisms that inflemence individual or group behavior. The attribute that distinguishes the three types of informal control: self, social and cultural. Self-control: The individual establishes personel objectives, monitors their attainment and adjusts behavior if off course. A second type of control is variously termed "social control", and "clan control". The third informal control, cultural control involves an entire division or firm. Cultural control is realized by the slow accumulation of organizational stories, rituals, legends and norms of social interaction. There are five types of organizational structure, namely, simple structure, machine bareuracy professional bureucracy, divisionalized form and adhocracy. In this research, machine bureucracy and divisionalized form are relevant to the model developed. Machine bureucracy is the struc ture Max Weber first described, with standardized responsibilities qualifications, communication channels, and work rules, as well as a clearly defined hierarchy of authority. In this structure technostructures hold great power to standartize work of operating core. This structure is called as planning organizations. The divisionalized form differs from the other four structural configu rations in one respect. It isn't a complete structure from the strategic apex to the operating core, but rather a structure supe rimposed on others. Divisions are created according to markets served and are then given control aver the operating functions required to serve these markets. The executive office has the responsibility for strategic decision making. In carrying out this responsibility, the executive office audits and evaluates the per formance of the divisions and allocates capital among the divisions based on the relative performances of the divisions. Organizations can be considered in terms of open system model. The open system is in continual interaction with its environment and achieves a steady state or dynamic equilirium while still retaining the capacity for work or energy transformation. A system can be des cribed in terms of environment, performance criteria, goals and its management. xvmThere exits na universally accepted operational meaning for the term "strategy". This lack of consistency is due to two fac tors. First, strategy is multidimensional. Second, strategy must be situational and, accordingly it will vary by industry. Strategy definitions in the literature cluster into three distinct groups. First model to be widely adapted is linear and focuses on planning. According to the linear view, strategy consists of integrated decision, actions or plans that will set and achieve viable orga nizational goals. Second model is adaptive strategy. According to the model, organization is expected continually to assess external and internal conditions. Assessment then leads to adjust ments in the organization or in its relevant environment that will create -satisfactory alignments of environmental opportunities and risks, on the one hand and organizational capabilities and resources. Third model is interpretive strategy. Strategy in the interpretive model might be defined as orienting metaphors of frames of referen ces that allow the organization and its environment to be understood by organizational stakeholder. There are two types of strategic management processes; namely strategic planning system (SPS) and strategic issue management (SIM). Most SPS are based on periodic activities, while SIMS by their very nature have to be continuous in character. The conventional SPS tends to respond to strong signals, while SIMS is intended to pick up weak not so obvious signals. Strategic management processes based on strategic planning include main steps; namely, analyzing current status, examining prospects for the future, setting the future course and putting the strategy to work, and evaluating and controlling strategy. Analyzing current status consist of identifying mission, present and past strategy, and diagnosing present and past performance. Ex amining: prospects for the future is comprised of setting long-range objectives, internal and environmental analysis. In the setting the future course, strategic corporate and business alternatives are defined, compared and one of them is chosen. The last step of the processes is to implement the strategy. Strategic issue management consists of six steps; namely, issue idenf ications, issue assessment, issue analysis, development of issue-related stratgy, strategy implementation and measuring result- monitoring issue. Strategic issue management is triggered by strategic issue. A strategic issue is a condition or pressure either internal or external that will have a significant effect on the functioning of the organization or its future interest. The objective of strategic issue management are the early idenfication of potential strategic issue and the assessment of issue to facili tate action. Criteria for an issue to be identified as strategic and/or moved along to subsequent stages of the strategic issue management process are strategy relevance, actionability, criticality and urgency. A concept that is important to both strategic planning and strategic issue management is environment. Environment compri ses virtually everything outside the organization. Organizations must adap to their environment if they are to remain viable. A distiction should be made between the composition of organizational environments and environmental characteristics or dimensions. The former refers to the factors and components that comprise the focal unit's environment. A distiction is made between the internal and XIXexternal environment. The internal environment consists of those relevant physical and social factors within the organization. The external environment consists of those relevant physical and social factors outside the boundaries of the organization. External environment is divided into two distinct environment; namely, task environment and general environment. Task environment affects directly the organization and includes supplier, customer, compe titors, regulatory groups and, technological requirements. General environment doesn't affect directly the organization and includes, economical, technological, socioligical, political, educational, cultural sub environments. Although the general environment is the same for all organization in a society task envionment is different for each organization. Task environment has impact on the goals and values, structure, technology, human relationship, and mana gerial processes within organizations. The other distictions between the environment are mede in terms of perceiving and abjec tive environment. Environmental characteristics which affect both strategic decision making processes and organizational performance are uncertainty, dynamizm, munificience and complexity. Control systems is the process which allows senior management to determine whether a business unit is performing satisfactorily, and which provides motivation for businesss unit management to see that it continues to do so. It therefore. normally involves the agreement of objectives for the business between different level of management; monitoring of performance against these objectives; and feedback on results achieved, together with incen tives and sanctions for business management. The control systems also provides the basis for decisions on actions to correct devia tions from planned objectives. Some writers regard strategic control as directing subordinates or systems to assure proper action. Others refers to strategic control as the critial evaluation of plans, activities, and results, there by providing information for future action. Most management thinking about control is feedback- oriented. It can be said that there are five types of strategic control; namely, strategy control, premise control, implementation control, strategic change control and performance control. Strategy control is checking the basic strategics being pursued to determine whether they seem to be reasonable or normal relative to what one would expect, either based on information collected empirically on the status of other similar strategies in comparable corporations or by reviewing the appropriateness of such strategics in a parti cular type of competitive environment. Premise control has bEen designed to check systematically and continuously whether or not the premise set during the planning and implementation process are still valid. Accordingly, premise control is to be organized- along these premises. Implementation control is to see whether strategy implementation proceeds as planned. In order to control the current strategy, standarts (milestones) must be provided in strategic plans. Strategic control is managing change- at the strategic level that affects the objectives, direction or domain of the company. Changes exits continuously and are the main characteristic of environments. Based on Chaffee (1985), it can be sait that stratgy is to match the organization to the- change in the environment. Because organizations can be defined in terms of xxopen system concepts, they receive input from environment and process the inputs to produce outputs. The processes to produce output must be consisted with the changes in environment. Although changes exits continuously some of them are important to the orga nization. Changes important for organization must be seperated from the unimportant ones. Important changes are called as stra tegic isuue. There are several criteria to seperate the strategic issues from other issues. These criteria are strategy relevance, actionability, criticality and urgency. Organizations face two types of strategic issues originating inside or outside the orga nization's boundraies. Decline in employee satisfaction or the development of a new technology by an organization's research and development group represent internal strategic issue. Such issues are classed as strategic because they alter the organization's performance if left unnoticed or unaddressed. They are distinctly internal because the locus for their occurrence is within the organization's boundraies. In conrast, external strategic issues emanate from source outside the organization's boundraies. For example, competitor actions, political unrest, or changes in regulatory rules represent potantial external strategic issues. There are some approach and models for strategic control. Analy tical models, such as Growth/Share matrix of Boston Consulting Group, Industry position/Competitive pcsiton matrix of Arthur D. Little, Industry attractiveness/Business Strengths of Mc Hinsey, product life cycle curve and break-even point analysis are used to control strategy. Environmental scannig is used to control imple mentation of strategy and external strategic issues» Growth and survival of an organization are dependent on the nature of the environment it encounters. It is therefore essential for every organization to be aware of the nature of environment it is facing and is likely to face in the future. A business environment scanning system for an organization consists of a set of radars to monitor the important events in the environment which may create opportunities or threats for the organization. These events are visible in the environment in the form of WEak signals. A good business environment system will receive these weak signals and generate early warnings for the organization by developing a set of scenarios indicating the effects of these events on the organi zation. Internal strategic issues often are triggered by deviations in the organization's or some subunit's performance from targeted performance goals. Performance is a recurrent theme in most branches of management, including strategic management, and it is of interest to both academic scholar and practicing managers. The treatment of perfor mance research setting is perhaps one of the thorniest issue confronting the academic reseacher today. A variety of approaches to the definition of organizational performance have emerged from different conceptualizations of the meaning of an organization. That is, organizations have been viewed as rational entities in pursuit of goals, as coalitions reacting to strategic constituencies, and so an. Three approaches to defining organizational performances received particular attention. The most widely used is the goal model, which defines effectiveness as the extent to which the organization accomplishes its goals. The second approach to XXIorganizational performance, the system resource model focuses on the ability of the organization to obtain needed resources. A third approach is the strategic constituencies model in which performance is defined in terms of the degree to which the need and expectations of strategic constituencies are met by the orga nization. In strategic management research, criteria to measure the organizational performance can be divided into three subgroups; namely, financial criteria, organizational criteria, and operati onal criteria. Financial criteria are assumed to reflect the fulfillment of the economic goals of the firm. Profit, profitability (reflected by ratios such as return on investment, return on sale, and return on equity), earnings per share, so forth are financial criteria. Market share, new product introduction, relative product quality are operational criteria. Organizational criteria are used generally by organization theorist and strategic constitues. Which performance criteria are used is dependent on same contingent factors such as, environment in which organizati onal unit operates, goals which is pursued by the units, responsi bility center, organizational structure and hierarchical level of the unit in the organization. There are four responsibility centers; namely cost, profit, revenue and investment center. The criteria cost, revenue, profit and profitability are for cost center, revenue center, profit center and investment center, respectively. In simple structure, flexibility readiness, resource acqusition, and growth are emphasized for performance criteria. In mechanistic structure productivity, efficiency, planning, goal setting are mostly used for performance criteria. In divisionalized structure, flexibly, readiness, productivity, efficiency are emphasized for performance criteria. Performance standards are other important issue for performance analysis. Two types of per formance standarts can be defined; organization in standarts and organization out standarts. Industry average standarts are a kind of organization out standarts. Goals which the organization pursues are a kind of organization in standarts. The models for performance control are divided into two groups; descriptive models and normative models. Z sc re Df Altman, D score of D'aveni are descriptive models. Normative models interest to the thesis. Literature is very scarce in term of normative models. Two morma- tive models encountered in literature research are STEMCDM and data envelopmen t model. The purpose of BTEMCDM is to provide mana gement with an integrated analytical procedure that will assist in bringing the actual performance of the firm as close as possible to target objective. By. comparing the actual performance index with the target performance index and monitoring it over time, management can identify situations where departmental performance is not in a state of (statistical) control. Data envelopment model presents the search for the relative efficiency of the firm in the form of a linear programme. Then firms under consideration use m inputs and produce s outputs. The inputs and outputs are known for each firm under the consideration. The efficiency is that defined as a ratio of the weighted sums of the outputs to the weighted sums of the inputs. The relative efficiency of one of a set of firms is obtained by treating the weights of inputs and outputs, and maximizing the efficiency of the firm subject to the efficiencies of all the firms being constrained to be less than a arbitrary limit such as, 1. xxiiIn this research, a model is developed for controlling the strategic changes occurring, in the organization's boundaries The model has two submodels; namely system dynamics model and control chart model. System dynamics model is used for producing the profit under the change of effectiveness/efficiency and demand. Control chart model is used for detecting the strategic change based on the profit results produced by the system dynamics model. Scope of the mcdel developed are as following: Model is for firms producing consumer products. Firms with continous production are relevelant to the model. It is also that model is available to firms in a divisionalized structure, and has a mechanistic charac ter. The model is based on some assumptions. System dynamics model has five subsystem; namely, production subsystem, distribution subsystem, selling subsystem, cash flow subsystem and performance subsystem. Developed system dynamics mcdel are based on followings: firm's structure and functions, performance criteria and efficiency/ effectiveness concepts. In production subsystem, interaction between production, inventroy and distributed goads from inventory are modelled. In distrubution subsystem, interaction between distributed goods from inventory and delivery to market are modelled. In selling subsystem, interaction between goods inventory in market, selling to consumer and demend are mcdelled. Cash flow subsystem include interaction cash out flow incurred for production, distribution and selling, and cash in flow stemming from selling. In performance subsystem profits are modelled. The other submodel, control diagram model, is for individual measu rement, say, profit, because profit is a individual measurement* control model uses the output of system dynamics model. To compute the control limit for control diagram, profit produced by system dynamics is used, and avarege profit and standart deviation of profit are computed. Conclusions drawn form the research can be divided into two groups: originality of the research and the conceptual implication of the literature review. In this thesis, a dynamic model with two submodel namely system dynamics model and control diagram model is developed for strategic control. These submodels are in a structure in which the output of a submodel becomes input of the other submodel. bJith the model one is able to detect the strategic issues, such as effectiveness and efficiency influencing an organization's performance or future. The system dynamics model producing profits was executed 135 times, based on the sample size computation. The control diagram was established based on the profits. Some concep tual implications are as follows: Although there is no consesus on performance, there are some approaches to performance. It can be said that there is a hierarchical structure amang the approaches. The succes of the models for strategy control is dependent on strategic determinism and strategic choice. xxi i i