Chapter 12: Turnaround strategy + strategy implementation

Question 1

Restructuring concept steps

Answer 1

A Company description
B Analysis of the company’s economic situation
C Analysis of the causes behind the crisis
D Target state of the restructured company -> turnaround objectives, strategy + activity
E business planning
F financing concept

Question 2

A Description of the company

Answer 2

• Description of the Company

- Assets/ revenues + financial situation

Question 3

B Analysis of the company’s economic situation in its sector

Answer 3

• by assessing the business model + strategic and operational positioning
• backed by market analysis + forecast as basis f. Business planning
  > market influence factors (global trend + SWOT)
  > market development + forecast

Question 4

C Analysis of causes behind the crisis

Answer 4

Starting point in development countermeasures

Crisis stages: strategy->profitability/ revenue->Liquidity

Question 5

D Target State fo the restructured company

Answer 5

Companys target state after turnaround:

• bottom line improvement
• strategic concept
• operating concept +action program

Question 6

E business planning

Answer 6

• P+L
• Balance sheet
• cash flow

Question 7

F Financing concept

Answer 7

Cornerstones

Question 8

Reasons for strategy implementation problems

Answer 8

• bridging gap between strategy development and its practical implementation
• implementation seen as operational task

Question 9

Negative consequences through implementation problems

Answer 9

• competitive disadvantage

- customers leave, key talent lost + financial performance suffers

Question 10

Barriers to successful strategy implementation

Answer 10

• the vision barrier (don’t understand strategy)
• the management barrier (executive teams don’t spend enough time time discussing strategy)
• the resource barrier (no link from budgets to strategy)
• the people barrier (no incentives linked toi strategy)

Question 11

Ten keys to successfully strategy execution

Answer 11

• development of resources + organizational capabilities required for successful execution
• established strategy-supportive organizational structure
• allocation of sufficient resources to the strategy execution effort
• staff organization with right people for executing the strategy
• policies + procedures which facilitate strategy execution
• adoption of best practices which drive continues improvement
• rewards + incentives for achievement of strategic/ financial achievements
• instilling a corporate culture => promotion of good strategy executions
• exercising strong leadership
• installation of information + operating systems