The document discusses the turnaround strategy for Alok Industries, a vulnerable textile organization in India. It provides an overview of Alok's history and products. In recent years, Alok faced performance decline due to external factors like changing economic conditions and internal issues like management failure. To recover, Alok implemented various generic turnaround strategies like cost reduction, asset redeployment, and selective changes to product and market strategy. It also analyzed Alok's lifecycle and the strategies used during different stages, from growth to maturity and transformation, to achieve turnaround. These included developing new products, improving production efficiency, and adapting to increased demand during the COVID-19 pandemic.

1. TURNAROUND STRATEGY FOR A VULNERABLE ORGANISATION FOCUS
ON LONG TERM GROWTH STRATEGY AND SUPPORT MEASURES
Department of Management Studies
Indian Institute of Technology Roorkee
B M N 6 0 5 – S T R AT E G I C M A N A G E M E N T
PRESENTED BY
GROUP - 12
ANKITA SHUKLA | ANOOP TS | BABY CHANDRA | BHAVYA SIHMAR | MOHD. SUFIYAN | RAKESH G NAIR | SUCHI AERON
Design:
anoopts.com

2. Source : Thompson, A. A., Strickland, A. J., Gamble, J., & Thompson, A. A. (2005). Crafting and executing strategy: The quest for competitive advantage : concepts and cases. New York, N.Y: McGraw-Hill/Irwin.
2
Recovering from a period of
performance decline
Turnaround Strategies - An introduction
Making fundamental
adjustments to strategy
Transforming loss making
organization into a profit
making one

3. Source : Thompson, A. A., Strickland, A. J., Gamble, J., & Thompson, A. A. (2005). Crafting and executing strategy: The quest for competitive advantage : concepts and cases. New York, N.Y: McGraw-Hill/Irwin.
3
Reasons for Performance Decline
External Causes
• New aggressive competitor
• Increase in prices of supply
• Changes in the market demand
• Changing economic conditions
Internal Causes
• Management failure
• Inadequate financial controls and high costs
• Over expansion
• Ignorance of new trends

4. Adapted from: Dikshit, J. R. (2015). Turnaround strategy in Indian Textile Industry (Doctoral dissertation, Indira Gandhi National Open University IGNOU) | Source: http://hdl.handle.net/10603/249801 | License: CC BY-NC-SA 4.0
4
Strategy Overview
Strategy
Stability
Growth and
Expansion
Concentration
Integration
Horizontal
Mergers
Acquisitions
Vertical
Backward
Forward
Diversification
Related
Unrelated
Cooperation
Joint Venture
Strategic Alliances
Internationalization
Digitalization
Retrenchment
Turnaround
Divestment
Liquidation
Combination

5. Source : Thompson, A. A., Strickland, A. J., Gamble, J., & Thompson, A. A. (2005). Crafting and executing strategy: The quest for competitive advantage : concepts and cases. New York, N.Y: McGraw-Hill/Irwin.
5
Generic Turnaround Strategies
• Restructure leadership and organizational culture
• Cost Reduction
• Asset redeployment
• Selective product and market strategy
• Repositioning

6. INDUSTRY
OVERVIEW & ANALYSIS
6

7. Source: IBEF Report 2019 | Accessed at : https://www.ibef.org/industry/textiles.aspx.
7
Indian Textile Industry: Before COVID 19
• Indian textile and apparel is the second largest sector serving employment.
• 15% of total industrial production and contributes to 30% of exports.
• Cotton exports remained at US $ 38.70 billion in Financial Year 2019 .
• Highly endorsed to gain an increment to US $ 82 billion by Financial Year 2021.
• It has a large variety of sectors like the hand-spun and hand-woven materials areas.
• Textile industry in India has 1200 small, medium and large-scale textile mills operating in India.
• The material and dress exports represent 33% of the all out estimation of fares from the nation.
• This industry needs to upgrade the technology as 80% of the exported yarn comes from coarser yarn.
• Indian textile industry constitutes 4% of global market.

8. Image Source: http://www.businessworld.in/article/Covid-19-And-Textile-Industry/09-05-2020-191637/
8
Indian Textile Industry: Impact of COVID 19
• Factory closures
• The collapse of garment trade
• Cash flow constraints
• Labour force and employment
• Order cancellations have been common
• Import & Exports of raw material & readymade garment
• Factories are operating at reduced capacity..
• Handling cargo from affected countries
• Women have been disproportionally affected

9. Source: Ashok, P., et al. 2020 Impact of coronavirus outbreak on Indian textile sector. Journal of Management Research and Analysis, April-June, 2020;7(2):76-83
9
Indian Textile Industry: Impact of COVID 19
• Textile industry found the new opportunity in production of PPE kits, masks, disposable
towels, disposable bed sheets etc.
• India has become the second largest manufacturer for PPE kits with more than 600 certified
companies for its manufacturing.
• Government has allowed 100% FDI by automatic route in the textile sector.
• Integrated Textile Parks (SITP) and Technology Upgradation Fund (TUF).
• Twenty one readymade garments manufacturing units in 7 states were announced for modernization.
• India has potential to reach ~USD 70 Billion in export by 2024.

10. Current position
Source: Ashok, P., et al. 2020 Impact of coronavirus outbreak on Indian textile sector. Journal of Management Research and Analysis, April-June, 2020;7(2):76-83
10
Indian Textile Industry: Strategic Standpoint
Marketplace forces out of the control of the business may force business to make strategic changes
relevant to current and future business potential.
Such turbulences need carefully assessment of:
Expected future state
How market will change
Financial aspects ( looking for a long-term or a
short-term change),Operations, and Resources

11. Source: Cosentino, M. (2007). Case in point: Complete case interview preparation (p. 266). Burgee Press.
11
Indian Textile Industry: Strategic Standpoint
• Increasing sales
o Product development : based on new needs and wants
o Marketing your company : core values (communication)
o Redeveloping : converting capabilities into new possibilities
• Reducing costs cutting down on loss making units or product lines (cost analysis)
• Acquire and merge with competitors- for products, distribution channel, finance
• Innovation to adapt to new normal process, capabilities and competencies
What and how ?

12. Source: Cosentino, M. (2007). Case in point: Complete case interview preparation (p. 266). Burgee Press.
12
Indian Textile Industry: Strategic Standpoint
• Satiate contemporary market demands
o Prioritize short term successes to gain some momentum
o Decrease Volume of unsolicited products
• Realign supply chain
• High demand markets
• Acquisitions
o Joint venture/strategic alliance
o Acquire existing players
o Divesting Parts of business
What and how ?

13. AN
EXAMPLE
FROM TEXTILE INDUSTRY
13

14. BRIEF HISTORY
Founded in 1986: in Mumbai.
1989: Polyester Manufacturing Unit.
1993: NSE: ALOKINDS
Revenue: ₹131,810 million (2019)
Employees: 20,000+
Countries: 50+
3 Manufacturing Unit
Vision
To be the world's best integrated textile
enterprise, driven by research and
innovation, with a leadership position across
products and markets, while exceeding
customer & stakeholder expectations.
Dilip Jiwrajka
(Managing Director)
Surendra Jiwrajka
(Founder)
Key People
Source : ALOK Industries LTD Annual Report 2019
14

15. TIMELINE
Source : ALOK Industries LTD Annual Report 2019
15
Financial and technical collaboration with Grabal, Albert Grabher GmbH & Co of Austria.
Annual sales of Rs. 100 crore.
Expansion initiated under Technology Upgradation Fund Scheme (TUFs).
Turnover surpasses Rs. 1,000 crore.
ISO 9001:2000 Certification
25 years of corporate journey completed.
Turnover crosses Rs. 8900 crores and Exports reach Rs. 3030 crores.
Store Twenty One entered compulsory liquidation in July 2017, closing all stores.
Stock Price Fallen to ₹ 1.70.
Go Green Initiative
Survival by producing PPE Kits And Covid 19 Scenario.
1995
1996
2001
2004
2007
2011
2012
2017
2018
2019
2020
●
●
●
●
●
●
●
●
●
●
●

16. PRODUCTS
Source : ALOK Industries LTD Annual Report 2019
16
Cotton and Blended Yarn
SIlvassa India,13500 ton per annum
Apparel Fabrics - WOVENS
SIlvassa India,105 Million Meters per annum
Apparel Fabrics - KNITS
SIlvassa India, 67200 tons per annum
Embroidery
Navi Mumbai India, 34 billion stitches per annum
Garments- WOVEN & KNITTED
SIlvassa India, 22 Million pieces per annum
Home Textiles- BED LINEN
Vapi, India, 82.50 Million Mt. per annum
Home Textiles- TERRY TOWELS
Vapi, India, 6700 tons per annum
Polyester Texturised Yarn
SIlvassa, India,114000 tons per annum

17. MANAGING TURNAROUND : Life Cycle Perspective
Source : ALOK Industries LTD Annual Report 2019 and Yahoo Finance CLC Adapted FromDikshit, J. R. (2015). Turnaround strategy in Indian Textile Industry (Doctoral dissertation, Indira Gandhi National Open University IGNOU). Turnaround Strategy in Indian Textile Industry
17
Bankruptcy
In 2019, About to get bankrupt
Share Price
Share Value Went up to ` 1.76 (May 2018)
Start Up
Dynamic
Growth
Maturity
Transformation Future growth
Renewal
Liquidation
Entrepreneurial Management Turnaround Management
1986
1992
2016
2017
2020
2019
Mere Recovery
Short term
Survival but
eventual failure

18. MANAGING TURNAROUND
Source : ALOK Industries LTD Annual Report 2019 and Yahoo Finance
18
Worker Wear Fabrics
Vapi, India, 20 Million Mtr. per annum
Product & Design Development
Vapi, India.R & D Facility
50.599998
0
10
20
30
40
50
60
11/22/2019 12/22/2019 1/22/2020 2/22/2020 3/22/2020 4/22/2020 5/22/2020 6/22/2020 7/22/2020 8/22/2020 9/22/2020 10/22/2020
STOCK PRICES - NSE: ALOKINDS

19. 19
Scan QR for More
Detailed Information

20. 20
CONCLUSION
• Textiles demand had plummeted in past months as retails were completely shut due to
Covid-19 induced lockdown globally.
• Manufacturers operating from readymade complex in making shirts, pants and other apparel
switched production to PPE kits, masks, disposable towels, disposable bed sheets etc.
• Turnaround strategy means to change a loss-making company into a profit-making company
• It helps to sick company to stand once again in the market.

21. THANK YOU