Strategic Audit
The Strategic Audit Many companies begin their operation in different ways. Some companies start with a lot of capital and become successful, while others start with very little capital and still find success. However, once profitability has been achieved, it can be very difficult to maintain in the long run. One tool many managers use in order to keep operations running smoothly is the strategic audit. A strategic audit is used to compare current operations with ideal operating conditions. A strategic audit defines what strengths and weaknesses a company may have. Finally, a strategic audit is usually used to define what needs to change or where the company can improve and how. First, a strategic audit tends to be a broad check of differing operations within a company. Managers look at either their company at its peak and compare with their current company standing or they look at a different leading companies and compare from there. The audit can comprise of many different questions that are usually answered in detail to provide guidance on where the company stands. These questions are created by management to move the company to a stronger position. The strategic audit can also be a checklist of sorts where employees must make sure that each point on the checklist is in compliance. If there are missing points that were supposed to be checked off on the audit, the company can proceed with fixing that problem. Also, strategic audits can be informal as well as formal. It can be as simple as an employee noticing that a leading competitor is doing an operation much more efficiently. However, it can also be as complex as an audit team solely working on auditing the company and making sure standards are always met. That begs the question, what does the strategic audit do? The audit does two things: it highlights a company’s strengths and weaknesses and precisely highlights problems to management. Knowing a company’s own weaknesses is key in