Corporate strategy and shareholder value during decline and turnaround

Furrer, Olivier; Pandian, J. Rajendran; Thomas, Howard

doi:10.1108/00251740710745025

Cited by 24 publications

(14 citation statements)

References 93 publications

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“…Regarding managerial cognition, we illustrated the importance of managerial cognition in shaping turnaround strategising practices, in that, we have confirmed that management's awareness of decline and their perception of the declines severity, were found to have a profound effect on the timing and intensity of actions taken (also found by Furrer et al 2007). Given the critical role that stakeholders play in the turnaround process, two key dimensions emerged from the data; stakeholder influences, and stakeholder relationships.…”

Section: Response Factorssupporting

confidence: 59%

Creating opportunities in the face of an environmental jolt: exploring turnaround strategizing practices within large Irish construction contractors

Tansey

Spillane

Brooks

2017

Construction Management and Economics

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Firms that face organisational decline choreographed from an environmental jolt must seek new ways of creating opportunities in order to successfully turnaround. As such, the identification of pertinent turnaround strategies becomes increasingly important for senior management. Within the strategy-as-practice scholarly, there have been recent calls to move beyond empirical 'isolationism' and to connect with other larger social phenomena; while across the turnaround literature there have been calls to explore the process and microstructure of turnaround strategies in cyclical environments. To address this research gap, the purpose of the study is to adopt a tall ontology by blending the strategy-as-practice lens with the organisational decline and turnaround lens. By drawing on five exploratory case studies of large Irish construction contractors, the central objective is thus to explore firms' turnaround strategising practices during an environmental jolt. In order to advance our tall ontology, we developed a turnaround strategising process model (and propositions) that integrates our findings, and which offers the fundamental building blocks of a new blended theory. We find that successful turnaround attempts entail the simultaneous interaction of non-aggressive cost retrenchment actions and non-extensive internationalisation. The case studies further suggest that during a prolonged environmental jolt, cost retrenchment is more often a long-term strategy. Lastly, the findings provide valuable support for practitioners in developing a successful turnaround response, and in aiding the selection and timing of operational and strategic actions.

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Section: Response Factorssupporting

confidence: 59%

Creating opportunities in the face of an environmental jolt: exploring turnaround strategizing practices within large Irish construction contractors

Tansey

Spillane

Brooks

2017

Construction Management and Economics

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“…However, empirical results remain inconclusive; Andrade and Kaplan (1998) state that CAPEX reductions are inevitable for firms in distress, and Sudarsanam and Lai (2001) cannot find any significant influence. Moreover, Furrer et al (2007) postulate that CAPEX negatively relates to market performance in the years immediately after a turnaround, and only reveals positive effects in subsequent mid-term years. Hence, significant performance enhancement can be expected only if accompanied by strategic asset retrenchment or portfolio restructuring (Lins et al 2013;Pearce and Robbins 1993).…”

Section: Capital Expendituresmentioning

confidence: 99%

“…However, Hotchkiss (1995) offers contradictive results that employ accounting measures, predominantly used in general management research. Although scholars rely on market measures to argue that relative and absolute accounting measures can be subject to managerial manipulation, the counterparty claims market measures are biased by expectations (Eberhart et al 1999;Franzen et al 2007;Furrer et al 2007).…”

Section: Turnaround Outcomementioning

confidence: 99%

Corporate distress and turnaround: integrating the literature and directing future research

Schweizer

Nienhaus

2017

Bus Res

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The topic of corporate distress and turnaround has been of interest to organizational change theory for many decades. This article considers existing reviews in discussing the current body of turnaround literature across multiple research fields and structures its work along a holistic framework. The numerous facets of corporate turnaround, resorting to general corporate restructuring research classifications, are clustered in a more detailed manner than those that merely rely on two commonly employed turnaround dimensions: ''retrenchment'' and ''recovery.'' The authors develop an agenda for future research based on this cross-disciplinary literature aggregation by highlighting current gaps and offering potential research questions. The review contributes to the understanding of corporate distress and turnaround by integrating different research streams. Additionally, the work emphasizes the need for further harmonization and operationalization in turnaround success metrics.

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“…Regarding the decline literature, one inference we can draw is that those private sector studies emphasizing market and financing strategies typically have limited relevance for public administration. Likewise, studies focusing on shareholders (Furrer, Pandian, and Thomas 2007), asset costs and depreciation (Morrow, Johnson, and Busenitz 2004), and stock and corporate boards (Mueller and Barker 1997) seem to have limited relevance. Even studies focusing on technological innovation seem to have limited relevance.…”

Section: The Irrelevance Of the Generic Decline Literaturementioning

confidence: 99%

Hard Lessons from Hard Times: Reconsidering and Reorienting the “Managing Decline” Literature

Bozeman¹

2010

Public Administration Review

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Hard Lessons from Hard Times: Reconsidering and Reorienting the "Managing Decline" Literature Does the public administration research from the late 1970s and 1980s on managing decline contain useful lessons for today's Great Recession? Do these studies serve our current research needs? Why has decline continued to be a major focus of research in generic management, but not in public administration? Th e answers to these questions give some clues as to a possible new, revitalized research agenda for our fi eld. Whereas public administration often viewed organizational decline as a self-contained set of problems requiring remedial action, generic management and sociology research on decline tended to view the topic as part of organizational phases and life cycles, linking decline to growth, stability, and change. Viewing decline as part of the organizational life cycle encourages researchers to take a longer view of organizations and their management, and thus its orientation is more strategic than reactive. Th ree areas of decline studies are identifi ed as relevant irrespective of sector: (1) implications of decline for human resources management, (2) eff ects of decline on organization structure and design, (3) the relation of strategy and decline.

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Corporate strategy and shareholder value during decline and turnaround

Cited by 24 publications

References 93 publications

Creating opportunities in the face of an environmental jolt: exploring turnaround strategizing practices within large Irish construction contractors

Creating opportunities in the face of an environmental jolt: exploring turnaround strategizing practices within large Irish construction contractors

Corporate distress and turnaround: integrating the literature and directing future research

Hard Lessons from Hard Times: Reconsidering and Reorienting the “Managing Decline” Literature

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