Levers of Control During Strategy Implementation

Secondly, the technology required for the low-class lock is low and the lock can be produced by some small companies in town. They have a cost advantage in tax and administration. The product can meet the requirement in the low-class market. Thirdly, the higher steel price compresses the profit space.The case company is located in the North of China. It is a medium-size company which has three production lines and can produce about a hundred kind of lock. Their products are mainly the door lock and padlock. Their locks are used in civil and industrial areas. They can produce the low- and medium class lock. Between 2003 and 2005, they pay attention to low-class door lock because of high demand by the construction company. In these two years, the competition in the low-class market became fierce They decided to go back to the medium market. In 2007, The productivity of medium-class lock take 30% percent and the profit takes more than 50%. The top management realized they must develop in a medium-class market because of the high-profit ratio. However, their vision and strategy can not be implemented successfully by their current performance and control system.During strategy implementation, strategic uncertainty must be met. These strategy uncertainties drive the new strategy. The company’s current source of strategy uncertainty is stronger competition (Atkinson and Court, 1998). Normally, companies choose one or more performance measurement and control systems to monitor the uncertainties interactively. The case companies choose the revenue interactively which is highly responsive to changes in competition. However, the measure of the whole revenue can not meet the requirement of the new strategy as the companies decide to develop their product in the medium product market. The sales and profit of the medium class products are not monitored separately and interactively. Moreover, the supplier is an important aspect of strategic uncertainty in the competitive market.