According to the document:
1. McKinsey's 7-S framework identifies 7 elements for successful business practice including strategy, structure, shared values, style, staff, skills, and systems.
2. Turnaround strategies aim to reverse negative trends in a company's performance by implementing measures like changing top management, building initial credibility, neutralizing external pressures, and identifying quick fixes.
3. Diversification involves expanding a company's production base through related, horizontal, or conglomerate diversification to reduce risk and utilize synergies. However, diversification can also lead to disasters if not done properly.
International Business (BBA MBA) advantages & disadvantages of international busine, approaches of international business, entry strategy, imf, international business (bba mba) entry policy, international organization, nature & scope & feature of international business, need for international business, reasons for recent growth in international busines, what is international business ?university of solapur
International Strategic Management is an ongoing management planning process aimed at developing strategies to allow an organization to expand abroad and compete internationally.
An organization must be able to determine what products or services they intend to sell, where and how the organization will make these products or services, where they will sell them, and how the organization will acquire the necessary resources for these tasks. Even more importantly an organization must have a strategy on how it expects to outperform its competitors.
Learning Objectives
Outline the process of strategic planning in the context of the global marketplace.
Examine both the external and internal factors that determine the conditions for development of strategy and resource allocation.
Illustrate how best to utilize the environmental conditions within the competitive challenges and resources of the firm to develop effective programs.
Suggest how to achieve a balance between local and regional/global priorities and concerns in the implementation of strategy.
INTERNATIONAL ENTRY MODES
Criteria for Country selection :
Choosing Product to trade in International markets
Global Product Strategies
Strategy for new product launch
STANDARDIZATION VS ADAPTATION
FOREIGN MARKET ENTRY MODES
6. International Marketing, Market Selection, Modes of Entry in International...Charu Rastogi
This presentation defines international marketing, international marketing decisions, challenges of international marketing, and driving and restraining forces of international marketing. It goes on to discuss the process of market selection, firm related, market related and other factors effecting market selection. It also reflects on various modes of entry into foreign markets such as exporting (commercial strategy, commercial mode), foreign direct investment (industrial strategy, integrated modes) and associated or contractual modes (contractual strategy, competitive alliances). The presentation closes with a case study on the experience of Proctor and Gamble (P&G) in various international markets like Japan, China and India.
International Business (BBA MBA) advantages & disadvantages of international busine, approaches of international business, entry strategy, imf, international business (bba mba) entry policy, international organization, nature & scope & feature of international business, need for international business, reasons for recent growth in international busines, what is international business ?university of solapur
International Strategic Management is an ongoing management planning process aimed at developing strategies to allow an organization to expand abroad and compete internationally.
An organization must be able to determine what products or services they intend to sell, where and how the organization will make these products or services, where they will sell them, and how the organization will acquire the necessary resources for these tasks. Even more importantly an organization must have a strategy on how it expects to outperform its competitors.
Learning Objectives
Outline the process of strategic planning in the context of the global marketplace.
Examine both the external and internal factors that determine the conditions for development of strategy and resource allocation.
Illustrate how best to utilize the environmental conditions within the competitive challenges and resources of the firm to develop effective programs.
Suggest how to achieve a balance between local and regional/global priorities and concerns in the implementation of strategy.
INTERNATIONAL ENTRY MODES
Criteria for Country selection :
Choosing Product to trade in International markets
Global Product Strategies
Strategy for new product launch
STANDARDIZATION VS ADAPTATION
FOREIGN MARKET ENTRY MODES
6. International Marketing, Market Selection, Modes of Entry in International...Charu Rastogi
This presentation defines international marketing, international marketing decisions, challenges of international marketing, and driving and restraining forces of international marketing. It goes on to discuss the process of market selection, firm related, market related and other factors effecting market selection. It also reflects on various modes of entry into foreign markets such as exporting (commercial strategy, commercial mode), foreign direct investment (industrial strategy, integrated modes) and associated or contractual modes (contractual strategy, competitive alliances). The presentation closes with a case study on the experience of Proctor and Gamble (P&G) in various international markets like Japan, China and India.
Based on everything you know then, what is Bezos singular grand s.docxikirkton
Based on everything you know then, what is Bezos' singular grand strategy out of the list I sent you all below. Well developed ideas, by the way! Well done.
A simplified and concise definition of grand strategies is that they direct the organizations to the available paths open to them which would allow the achievement of their longterm objectives.
CONCENTRATION
The first strategy and the simplest is that of CONCENTRATION. The organization directs its efforts and resources to the profitable growth in the market and technology in which it is currently operating. The reason for this approach is the low additional resources required as well as low risk, since by their known competency they have prospered in the past. The negative side to this is the trends of industries in some cases have been shown to alter performance and the organization is then left with an outdated product. Also, the company may incur slow profitability and growth with this strategy. This is THE market penetration approach. You just have to aware of market conditions that help or may hinder prosperity using this approach. Having a corner on the market of the buggy whip business is not a good idea.
MARKET AND PRODUCT DEVELOPMENT
I will combine, in a fashion, the MARKET DEVELOPMENT (the second) and PRODUCT DEVELOPMENT (the third) strategies in the interest of space. Market development requires some modification in the product and in channels of distribution as a way to seek new markets. Also, variations in model and product size constitute an approach in this strategy. The product development factor is normally chosen to prolong the life cycle of currently sold products or to take advantage of a favorable reputation or brand name. Both of these involve moderate risk and cost.
INNOVATION
INNOVATION is our fourth strategy. Many industries have gone out of business because they refused to place due resources in R&D efforts. With the rapid turnover of technology, it is foolhardy not to place capital into the future of the business through innovation. This strategy differs from the product development in the extent to which products come out as brand new or fundamentally new though innovation. Innovation will make other products obsolete. The negative in this approach is in the failure rate: innovation is fraught with risk and uncertainty.
HORIZONTAL AND VERTICAL INTEGRATION
In the interest of brevity I will combine our two integration strategies; namely, HORIZONTAL INTEGRATION (HI) and VERTICAL INTEGRATION (VI). Both of these strategies allow growth through the acquisition route, but HI uses the purchase of a the organization in a similar
business in the same stage of the productionmarketing chain. VI permits growth through the acquisition of the organization which is a supplier of inputs to the acquirer and is known as BACKWARD INTEGRATION while the union with the organization closer to the ultimate consumer would be known as FORWARD INTEGRATION. HI allo ...
Strategic Purpose
Business Level Strategy
Corporate Level and International Strategy
Strategy Direction and Methods of Developments
Organizing for Strategy Success
Enabling Strategy Success
Managing Strategic Change
Understanding Strategy Development
Key Learning Points
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not au
C-level Innovation as Collaborative Business TransformationMalcolm Ryder
Executive adoption of innovations is an outcome of forming and pursuing a group ambition, but the group must be executives themselves, and it could also take a group of innovations to get any of them adopted.
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
NO1 Uk Black Magic Specialist Expert In Sahiwal, Okara, Hafizabad, Mandi Bah...Amil Baba Dawood bangali
Contact with Dawood Bhai Just call on +92322-6382012 and we'll help you. We'll solve all your problems within 12 to 24 hours and with 101% guarantee and with astrology systematic. If you want to take any personal or professional advice then also you can call us on +92322-6382012 , ONLINE LOVE PROBLEM & Other all types of Daily Life Problem's.Then CALL or WHATSAPP us on +92322-6382012 and Get all these problems solutions here by Amil Baba DAWOOD BANGALI
#vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore#blackmagicformarriage #aamilbaba #kalajadu #kalailam #taweez #wazifaexpert #jadumantar #vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore #blackmagicforlove #blackmagicformarriage #aamilbaba #kalajadu #kalailam #taweez #wazifaexpert #jadumantar #vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore #Amilbabainuk #amilbabainspain #amilbabaindubai #Amilbabainnorway #amilbabainkrachi #amilbabainlahore #amilbabaingujranwalan #amilbabainislamabad
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Resume
• Real GDP growth slowed down due to problems with access to electricity caused by the destruction of manoeuvrable electricity generation by Russian drones and missiles.
• Exports and imports continued growing due to better logistics through the Ukrainian sea corridor and road. Polish farmers and drivers stopped blocking borders at the end of April.
• In April, both the Tax and Customs Services over-executed the revenue plan. Moreover, the NBU transferred twice the planned profit to the budget.
• The European side approved the Ukraine Plan, which the government adopted to determine indicators for the Ukraine Facility. That approval will allow Ukraine to receive a EUR 1.9 bn loan from the EU in May. At the same time, the EU provided Ukraine with a EUR 1.5 bn loan in April, as the government fulfilled five indicators under the Ukraine Plan.
• The USA has finally approved an aid package for Ukraine, which includes USD 7.8 bn of budget support; however, the conditions and timing of the assistance are still unknown.
• As in March, annual consumer inflation amounted to 3.2% yoy in April.
• At the April monetary policy meeting, the NBU again reduced the key policy rate from 14.5% to 13.5% per annum.
• Over the past four weeks, the hryvnia exchange rate has stabilized in the UAH 39-40 per USD range.
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
NO1 Uk Rohani Baba In Karachi Bangali Baba Karachi Online Amil Baba WorldWide...Amil baba
Contact with Dawood Bhai Just call on +92322-6382012 and we'll help you. We'll solve all your problems within 12 to 24 hours and with 101% guarantee and with astrology systematic. If you want to take any personal or professional advice then also you can call us on +92322-6382012 , ONLINE LOVE PROBLEM & Other all types of Daily Life Problem's.Then CALL or WHATSAPP us on +92322-6382012 and Get all these problems solutions here by Amil Baba DAWOOD BANGALI
#vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore#blackmagicformarriage #aamilbaba #kalajadu #kalailam #taweez #wazifaexpert #jadumantar #vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore #blackmagicforlove #blackmagicformarriage #aamilbaba #kalajadu #kalailam #taweez #wazifaexpert #jadumantar #vashikaranspecialist #astrologer #palmistry #amliyaat #taweez #manpasandshadi #horoscope #spiritual #lovelife #lovespell #marriagespell#aamilbabainpakistan #amilbabainkarachi #powerfullblackmagicspell #kalajadumantarspecialist #realamilbaba #AmilbabainPakistan #astrologerincanada #astrologerindubai #lovespellsmaster #kalajaduspecialist #lovespellsthatwork #aamilbabainlahore #Amilbabainuk #amilbabainspain #amilbabaindubai #Amilbabainnorway #amilbabainkrachi #amilbabainlahore #amilbabaingujranwalan #amilbabainislamabad
2. McKinsey’s 7-S Framework
[Source: Peters & Waterman, “In search of Excellence…”]
According to McKinsey & Co,
Strategy is only one of seven
elements in successful business
practice, hence real change in large
institutions is a function of at least
seven areas of complexity.
Some of these may be regarded as
the hardware while some others may
be regarded as software of business.
Structure
// Shared
values
Systems
Style: Company employees share a common way of thinking and behaving, eg.
McDonald’s employees smile at the customer, while IBM employees are very
professional in their customer dealings.
Skills: Employees have the necessary skills to carry out the company’s strategy.
Staff: Co. has hired able people, trained them well and assigned them to the right jobs.
Shared values: act as a bond whereby employees share the same set of guiding values,
eg. Tata companies. When all these elements are present, companies are usually more
successful at strategy implementation.
Dr. B. K. Mukherjee 2
Staff
Strategy
Skills Style
Hardware of success
Software of success
// Bond
4. Intensive Growth - The Ansoff’s Matrix
Review of opportunities for improving the existing businesses’ performance
Existing Products New Products
H.Igor Ansoff’s ‘Product - Market Expansion Matrix, HBR, 1957 [Ref: Aaker David, Ch.11]
Dr. B. K. Mukherjee 4
MARKETS
PRODUCTS
Existing
Markets
New
Markets
Market Penetration Strategy
Market Development Strategy
Product Development Strategy
Diversification Strategy
• Increase Market share by
- creating a SCA (Sustainable
Competitive Advantage) with
enhanced customer value.
• Increase product usage through
- increase in frequency of use,
- increase in quantity of use, and
- new applications for current users.
• Add product features, product
refinement
• Develop a new-generation product
• Develop new (related) products for
the same market (through brand
extension).
• Expand geographically
• Target new segments
• Related
• Unrelated
5. Diversification
DIVERSIFICATION: process of making the production base wider by
bringing in the element of variety. A business enterprise may diversify
to utilise the existing infrastructure better so as to improve efficiency;
to reduce the risk of ‘putting all the eggs in one basket’;
to reap the fruits of synergy accruing out of “joint efforts and shared
costs”. These synergies may be identified as
Production synergy (same plant/machinery),
Marketing synergy (same dealers, ad agency/campaigns, etc),
Financial synergy, and
Organizational synergy (same staff, infrastructure, etc).
TYPES OF DIVERSIFICATION:
1. CONCENTRIC Diversification is the process of adding products/
services that are related to the existing products/services (“sticking
to the knitting”). They fall within the framework of the organization’s
knowhow and experience in technology, product line, distribution
channels or customer base. Example, ‘Amul’ has diversified into
chocolates, ice creams, butter, ghee, cheese, etc., Honda from
motor cycles into scooters, three-wheelers, cars, generators, etc.
Dr. B. K. Mukherjee 5
6. Diversification (contd)
2. HORIZONTAL Diversification: is where the organization adds unrelated
products/services for existing customers, eg. Reliance Textiles (Vimal)
into Petrochemicals and now Petroleum products.
Less risky, because the customers are known;
May be accomplished by acquiring the shareholding of the competitor, by
purchase of assets or by pooling of interests of two organizations.
3. CONGLOMERATE Diversification: refers to the strategy where
significantly different products/services are added to the present product
line, with a view to
cash in on expanding/new market opportunities, or
bringing about some turnaround by way of conversion of losses into
Dr. B. K. Mukherjee 6
profits.
Examples, the Godrej group diversifying from its core steel business (locks,
safes, cupboards, office furniture, etc.) into cosmetics, consumer
durables, toiletries, vanaspati, food, mosquito repellants, and so on.
Similarly, DCM diversifying from textiles into chemicals, calculators, sugar,
automobiles, etc.
ITC diversifying from tobacco into hotels, edible oils, financial services, etc.
7. Diversification (contd)
Some of the important mechanics for adopting Conglomerate
Diversification may be summarised as follows:
Supporting some divisions with cash flow from other divisions
during the period of development or temporary difficulty;
Using the profits of one division to cover the expenses of
another division without paying the taxes from the first division;
Taking advantage of unusually attractive growth opportunities;
Distributing risk by serving several different markets;
Gaining better access to capital markets and better stability or
Dr. B. K. Mukherjee 7
growth in earnings;
Increasing the price of an organization’s stock, and
Reaping the benefits of synergy (as already discussed).
8. Diversification (contd)
‘DIVERSIFICATION INTO DISASTERS’
Business World has identified the following factors which could
Dr. B. K. Mukherjee 8
lead to disasters:
1. If you are not big enough, do not try it.
2. If you lack in staying power, stay clear of grandiose
diversification.
3. Look before you leap.
4. If possible, be the first.
5. Where feasible, float a separate company.
6. Check whether you have the marketing skills necessary in the
new business.
7. Be ready to accept your limitations and compromise.
8. If you are a small player, it is better to have a small ego.
9. Tax saving alone is not a good enough reason to diversify.
10. Ultimately, it is no crime to remain undiversified.
9. Turnaround strategies
DEFINITION: ‘Turnaround’ is the process of re-activating a
deteriorating, sick unit which is facing a “‘survival crisis” due
to consistent downward trend in operating profits. This could
be attributed to several reasons:
DANGER SIGNALS – THE CAUSES OF CORPORATE SICKNESS
1. Inadequate Financial Controls: Ignorance of market dynamics
and/or lack of adequate control over cash inflows/outflows.
2. Ineffective Management: on account of the following factors
a) One-man rule: All power is concentrated in the CEO, hence
he keeps on repeating his past follies.
b) Combined Chairman and Chief Executive: Weakens not
only the process of execution but also effective monitoring
and controlling.
c) Ineffective Board of Directors: Rubbers stamps, signing on
the dotted line, thereby organisation continues to falter on all
fronts.
Dr. B. K. Mukherjee 9
10. Turnaround strategies (contd.)
d) Other managerial shortcomings: Managers, who have sneaked
into the organisation either through inheritance or other backdoor
entries, have neither the capability/will to develop nor the aptitude
to learn from others. They remain in their own shells surrounded by
sycophants and continue to be a constant liability to the company.
3. Competition: Inefficient and irrational organisations, which do not
keep pace with consumer preferences in a competitive market, will
face serious problems. Substituting products before they reach the
decline stage will provide energy and dynamism to the organisation.
4. High Cost structure (compared to competitors): due to
a) Inability to take advantage of economies of scale;
b) Cost disadvantage due to ineffective control of strategic variables;
c) Under-utilization of capacity/ill-maintenance of plant & machinery;
d) Other operating inefficiencies/unfavourable Govt. policies.
5. Changes in Market demand: either due to shift in consumer
preferences or other innovations resulting in emergence of better
product in the market, resulting in huge financial losses to the
company.
Dr. B. K. Mukherjee 10
11. Turnaround strategies (contd.)
6. Lack of Marketing effort: resulting from managerial complacency in
the declining phase. Failure to keep up the tempo of sales/promo-tions
or make the product appear attractive and presentable.
7. Big Projects & Acquisitions: Over-ambitious organisations sometimes
go in for projects/acquisitions for which they have neither the
resources nor the expertise to manage, thereby blocking funds
without ROI.
8. Irrational Financial policy: either due to high Debt/Equity ratio or use
of inappropriate financing sources/cash management.
9. Inadequate Reinvestment in Business: Adequate reinvestment in
plant, equipment and machinery is necessary for a company to
remain competitive.
TURNAROUND MANAGEMENT is defined as the measures adopted to
reverse the negative trends in the performance indicators of a
company, i.e, to turn a sick company back to healthy one. The exact
nature of turnaround management and the relative importance of
different factors may vary from company to company.
Dr. B. K. Mukherjee 11
12. Turnaround strategies (contd.)
TURNAROUND STRATEGIES: Prof. Pradeep N. Khandwalla (ex-IIM-A) has
identified the following 10 elements of a successful turnaround
strategy:
1. Change in top management: An efficient new CEO is usually
appointed, who will not only streamline things but may also have to
change the corporate culture.
2. Initial credibility-building measures: with both stakeholders and
shareholders, especially the employees.
3. Neutralizing external pressures: economic, political, trade-unions,
Dr. B. K. Mukherjee 12
vested interests, etc.
4. Initial control: Quick, firm grip over the affairs of the organisation.
5. Identifying quick pay-off activities: Marketing/promotional efforts.
6. Rapid cost-reductions: may require laying off surplus manpower.
7. Revenue generation: emphasis on recoverables, etc.
8. Asset liquidation for generating cash: SBUs, real estate, etc.
9. Mobilization of the organization: infusing a sense of urgency and
dynamism in the existing work-force, improvement in HR through
training and recruitment of competent people, if necessary.
10. Better internal coordination: lack of which is often a cause of the
decline, in the first place.