What is a strategic audit?

Strategic audits are performed to ensure that organizational strategies are effective and being executed properly with minimal waste. A strategic audit consists of 5 main activities:

• Audit of the strategy

• Communication effectiveness

• Resource utilization

• Zero-Based Budgeting

• Measurement and Reporting

The goal of any strategic audit would be to provide information to the organization for how to better align its activities and resources with its strategic goals.

Audit of the strategy itself

Just because an organization has a strategy, doesn’t mean that it is appropriate given the organization’s goals. Therefore, the first part of a strategic audit is to analyze this relationship. The strategy must be defined well enough to ensure accomplishment of the goal.

Communication of the strategy

The next part of the audit is to decide how effectively the strategy is being communicated throughout the organization. If the executive team knows the strategy and no one else really understands it, then an organization’s resources won’t be aligned. Continuous communication of the strategy is key when seeking to accomplish a goal. Otherwise, an organization may fight itself to achieve the same goal.

Resource utilization

An effective strategic audit will inventory and analyze all resources available to the organization and decide how well these are being used to implement the strategy and accomplish the goal. These resources include capital assets, human assets, partnerships, and intangible assets, such as public perception, corporate culture, etc.

Zero-Based Budgeting

This is the core of the audit. Decision makers over the budget are required to build their budgets from the ground up, not just based off last year's budget. Each spending decision is tied to the strategy and alternatives are submitted. Through this technique, organizations can be assured that every dollar is being spent wisely.

Measurement metrics

The last major part of a strategic audit will focus on the measurement metrics employed to evaluate, real time, how well the organization is doing at accomplishing the goal. We believe success must be measured to have its full effect. Therefore, carefully deciding how to measure progress and success is important to any strategy.

After providing the organization with this information, a decision can be made whether to implement the necessary changes internally, or continue to engage Honor Consulting to see the implementation through. Whatever the organization decides, Honor Consulting is committed to helping the client achieve success.

Each of these activities can be expounded upon or separated to fit an organization’s particular need. For more information on strategic audits or other services that Honor Consulting provides call 1-888-810-2897