Framework for Achieving a Successful Turnaround [SLAT99, S.74-103]

Stuart Slatter and David Lovett developed an approach for achieving a successful turnaround that consists of seven essential ingredients and an implementation framework consisting of seven key workstreams.

Characteristics of the appropiate remedy are that it must:

  • address the fundamental problems
  • takle the underlying causes (rather than the symptoms) (comment D.Dold: like lean approach „root cause and counter measures“)
  • be broad and deep enough in scope to resolve all of the key issues

Generic Turnaround Strategies

Seven Key IngredientsGeneric Turnaround Strategies
1. Crisis Stabilization
  • crisis management
  • cash management
  • asset reduction
  • short-term financing
  • first-step cost reduction
  • 2. Leadership
  • change of CEO
  • change of other senior management
  • 3. Stakeholder Support
  • communication
  • 4. Strategics Focus
  • redefine core business
  • divestment and asset reduction
  • product-market refocusing
  • downsizing
  • outsourcing
  • investment
  • 15. Organizational Change
  • structural changes
  • key people changes
  • improved communication
  • building commitment and capabilities
  • new term and conditions of employement
  • 6. Critial Process Improvements
  • improved sales and marketing
  • cost reduction
  • quality improvements
  • improved responsiveness
  • improved information and control systems
  • 7. Financial Restructuring
  • refinancing
  • asset reduction
  • Source: [SLAT99, S.77]

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