Reversing the downward spiral: lessons from W.T. Grant and Sears Roebuck

Business Failure and Entrepreneurship: Emergence, Evolution and Future Research

“…This perspective of failure progressing through separate and predictable stages is taken a step further by Mellahi [2005] with the concept of warning signals initiating the pre-failure stage, the signals indicate a forthcoming threat to the company's existence and if they are not spotted and appropriately acted upon by management the firm will begin its journey through the failure process culminating in the company's collapse. Similarly, Weitzel and Jonsson's [1991] five-stage model of failure corroborates the view that management inaction can decimate a firm during the initial stages of failure. A perspective offered by van Witteloostuijn (1998) uses a Cournot duopoly model to explore decline through competitive dynamics; it is argued that chronic failure is the result of organizational inertia, strategic competition, and cost inefficiency.…”

Defining Business decline, failure and turnaround: A content analysis

“…The reports of D'Aveni (1989), Lorange and Nelson (1987), Weitzel and Jonsson (1991), Pretorius and Holtzhauzen (2008) and Pretorius (2008a) The turnaround definition implies that a declining firm can be turned around, while a firm that has failed cannot. Judicial actions are often associated with failed firms but less often with those in decline and very small ventures, which enter and exit informally.…”

Organizational Decline and Innovation: A Contingency Framework

“…Escalating commitment to failing courses of action may provide an explanation for the rigidity that decision makers and their organizations sometimes exhibit during organizational decline. For example, Weitzel and Jonsson (1991) describe how W.T. Grant increased commitment to its policy of store expansion, despite repeated feedback that sales per square foot were declining.…”