Measuring the performance of strategy

Purpose: This paper aims to look at the problems of measuring the performance of business strategy. The authors look at the problem using two classical performance management paradigms and suggest a third approach which treats strategy as a stochastic network of actors and manoeuvres between those actors. Design/methodology/approach: This has been developed using action research in a number of strategy projects with a range of organisations in the private, public and third sectors. Findings: The two normal paradigms in use for performance measurement and management both struggle when applied to strategy. The problems are not merely ones of execution, they are much more fundamental and sit at the level of conceptual design. Modelling strategy as a series of manoeuvres between different actor organisations is both a more useful way to develop strategy but also provides a simple way to develop measures of strategic performance that can tell us not merely whether the strategy is being executed but also whether it is working. Originality/value: The paper describes a totally new approach to measuring strategy – both its execution and also its effectiveness which contrasts with both the two prevailing paradigms commonly used in the field of strategy.