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Turnaround strategy

The concept or meaning of turnaround strategy covers following points:

1. Turnaround strategy means to convert, change or transform a loss-making
company into a profit-making company.

2. It means to make the company profitable again.

3. The main purpose of implementing a turnaround strategy is to turn the
company from a negative point to a positive one.

4. If a turnaround strategy is not applied to a sick company, it will close down.

5. It is a remedy for curing industrial sickness.

6. Turnaround is a restructuring strategy. Here, a loss-bearing company is
transformed into a profit-earning company, by making systematic efforts.

7. It tries to remove all weaknesses to help a sick company once again become
strong, stable and a profit-making institution.

8. It tries to reverse the position from loss to profit, from declining sales to
increasing sales, from weakness to strength, and from an instability to

9. It aids to reduce the brought forward losses of the loss-making company.

10.It helps the sick company to stand once again in the market.

11.It is a complete U-turn of a planned strategic economic transition.

Financial Institution, for example, some bank ‘A’ is suffering from losses due to
non-performing assets (NPA). NPA is loan given but not yet recovered. This bank
‘A’ will follow turnaround strategy and try to recover its loans by appointing
recovery agents.

‘C’ is suffering from losses due to non- registration of students in their courses. conducting online classes. etc. Hunt coined the term ‘strategic group’ in 1972 when he noticed sub-groups of businesses with similar characteristics in the same market. The manufacturing company ‘XYZ’ will follow turnaround strategy to reduce labour inactivity by installing modern machines (automation) to carry on the same work or job. field or market. You then map the results on a matrix. to attract students. Michael Porter then expanded the concept in the 1980s.Manufacturing company say ‘XYZ’ is suffering from losses due to excess idle time taken by labour to complete their jobs. This institution ‘C’ will follow turnaround strategy to reduce losses by providing facilities like e-Registration. Educational institution. for example. relationships with other businesses in your sector and your understanding of the people who ultimately benefit from your products or services. Strategic group mapping The big idea Strategic group mapping is a technique for looking at your position in your sector. It . There are a number of benefits to strategic group mapping:  It can help you identify who your direct and indirect competitors (or possible partners) are  It can illustrate how easy it might be to move from one strategic group to another  It may help identify future opportunities or strategic problems  It ensures you take your customers’ or beneficiaries’ views into account when developing or assessing your strategy Purpose The purpose of strategic group mapping is to make sure you take the needs or wants of your customers/beneficiaries into account. The Tool The tool helps you assess the top five other players working in your field or sector. You can do it on your own or with a group. It encourages you to ask different questions about your future strategy.

. What is the Triple Bottom Line? The triple bottom line was first fully explained by John Elkington in his 1997 book "Cannibals With Forks: The Triple Bottom Line of 21st Century Business". It's a bottom line that continues to measure profits. It will take several hours to complete a detailed map. The triple bottom line is a way of expressing a company's impact and sustainability on both a local and a global most suitable for SMEs and larger businesses but can be adapted. but also measures the organization's impact on people and on the planet.

good working hours. Triple bottom line companies look at the entire life cycle of their actions and try to determine the true cost of what they're doing in regards to the environment. safe place to work. In some cases. and these include everyone that is involved with the company whether directly or indirectly. The company offers health care. they dispose of any toxic waste in a safe way. as well as the planet we're all living on. People Companies that follow the triple bottom line way of doing business think about the impact their actions have on all the people involved with them. on up to the CEO of the company. opportunities for advancement and education. the "people" bottom line can also include the community where the company does business. Do you apply it to employees? Their families? Suppliers? People near company buildings? How near? And what should you do if you need to restructure the business to remain competitive and shed some staff? Should your concern for people mean that you refuse to make redundancies even though this risks the long term viability of the organization for all staff? Planet Triple bottom line companies take pains to reduce or eliminate their ecological footprint. but only as part of it. they try to use renewable energy sources and they don't produce products that are unsafe or unhealthy for people and the planet. This can include everybody from farmers supplying raw materials. . a healthy. the difficulty comes in deciding how far you go with this. They strive for sustainability. and does not exploit their labor force (by using child labor or offering sweatshop wages).The concept behind the triple bottom line is that companies are responsible first and foremost to all their stakeholders. This approach sees shareholders as part of the stakeholder group. But it's not just about the money. While the concept of the people bottom line is certainly attractive. Everyone's well being is taken into consideration. recognizing the fact that "going green" may be more profitable in the long run. They take pains to reduce their energy usage.

Indiana Business Research Center. the idea is that profits will help empower and sustain the community as a whole. whether they're using triple bottom line or not.Profit The financial bottom line is the one that all companies share.D. Indiana University Kelley School of Business . Red ocean and blue ocean The Triple Bottom Line: What Is It and How Does It Work? Timothy F. Hall Economic Research Analyst. Indiana University Kelley School of Business Tanya J. Ph. Director of Economic Analysis. When looking at profit from a triple bottom line standpoint. Slaper. Indiana Business Research Center. and not just flow to the CEO and shareholders.

By focusing on comprehensive investment results—that is. yet measuring the degree to which an organization is being sustainable or pursuing sustainable growth can be difficult. Well before Elkington introduced the sustainability concept as "triple bottom line. planet and profits. sustainability. John Elkington strove to measure sustainability during the mid-1990s by encompassing a new framework to measure performance in corporate America." environmentalists wrestled with measures of. and a similar approach has gained currency with governments at the federal. Academic disciplines organized around sustainability have multiplied over the last 30 years. went beyond the traditional measures of profits. Interest in triple bottom line accounting has been growing across for-profit. people and the planet—triple bottom line reporting can be an important tool to support sustainability goals. called the triple bottom line (TBL). nonprofit and government sectors. and shareholder value to include environmental and social dimensions. Many businesses and nonprofit organizations have adopted the TBL sustainability framework to evaluate their performance. We will refer to these as the 3Ps. People inside and outside academia who have studied and practiced . policy-makers and economic development practitioners and highlights some current examples of putting the TBL into practice. return on investment.Sustainability has been an often mentioned goal of businesses. environmental and financial. nonprofits and governments in the past decade. and frameworks for. This article reviews the TBL concept. with respect to performance along the interrelated dimensions of profits. state and local levels. The Triple Bottom Line Defined The TBL is an accounting framework that incorporates three dimensions of performance: social. explains how it can be useful for businesses. The TBL dimensions are also commonly called the three Ps: people.1 This accounting framework. This differs from traditional reporting frameworks as it includes ecological (or environmental) and social measures that can be difficult to assign appropriate means of measurement.

If the users of the TBL had the stomach for it. cities. allows for comparisons between entities.sustainability would agree with the general definition of Andrew Savitz for TBL. as long as there is a universally accepted accounting method. Calculating the TBL The 3Ps do not have a common unit of measure. In this way. "Acres of wetlands" would be a measure. There remains some subjectivity even when using an index however. Another solution would be to calculate the TBL in terms of an index.2 The trick isn't defining TBL. Profits are measured in dollars. What is social capital measured in? What about environmental or ecological health? Finding a common unit of measurement is one challenge.. development projects or some other benchmark. human and environmental capital. comparing performance between companies. including both its profitability and shareholder values and its social. The trick is measuring it. including social welfare or environmental damage. how are the index components weighted? Would each "P" get equal weighting? What about the sub-components within each "P"? Do they each get equal weighting? Is the people category more important than the planet? Who decides? Another option would do away with measuring sustainability using dollars or using an index. Some advocate monetizing all the dimensions of the TBL. one eliminates the incompatible units issue and. for example. The TBL "captures the essence of sustainability by measuring the impact of an organization's activities on the world . Others question the method of finding the right price for lost wetlands or endangered species.. An example of an index that compares a county versus the nation's performance for a variety of components is the Indiana Business Research Center's Innovation Index.g. While that would have the benefit of having a common unit—dollars—many object to putting a dollar value on wetlands or endangered species on strictly philosophical grounds. For example. e.. . each sustainability measure would stand alone.

That said. Neither is there a universally accepted standard for the measures that comprise each of the three TBL categories. The level of the entity. the TBL is able to be case (or project) specific or allow a broad scope —measuring impacts across large geographic boundaries—or a narrow geographic scope like a small town. type of project and the geographic scope will drive many of the decisions about what measures to include. The TBL can also apply to infrastructure projects at the state level or energy policy at the national level. but a local mass transit might measure success in terms of passenger miles.and progress would be gauged based on wetland creation. say reducing the amount of solid waste that goes into landfills. such as a community building a park. the set of measures will ultimately be determined by stakeholders and subject matter experts and the ability to collect the necessary data. Following that. Additionally. we turn our attention to potential metrics for inclusion in a TBL calculation. The TBL user may get metric fatigue. A case (or project) specific TBL would measure the effects of a particular project in a specific location. different projects or policies (infrastructure investment or educational programs). The TBL can accommodate these differences. region or country). Having discussed the difficulties with calculating the TBL. The downside to this approach is the proliferation of metrics that may be pertinent to measuring sustainability. Both a business and local government agency may gauge environmental sustainability in the same terms. while a for-profit bus company would measure success in terms of earnings per share. destruction or status quo over time. we will discuss how businesses and other entities have applied the TBL framework. What Measures Go into the Index? There is no universal standard method for calculating the TBL. in the end. or different geographic boundaries (a city. data . This can be viewed as a strength because it allows a user to adapt the general framework to the needs of different entities (businesses or nonprofits). While there is significant literature on the appropriate measures to use for sustainability at the state or national levels.

Specific examples include:  Personal income  Cost of underemployment  Establishment churn  Establishment sizes  Job growth  Employment distribution by sector  Percentage of firms in each sector  Revenue by sector contributing to gross state product Environmental Measures Environmental variables should represent measurements of natural resources and reflect potential influences to its viability. measures vetted through academic discourse. It could incorporate air and water quality. are presented below. and business diversity factors. Ideally. taxes. employment. Economic Measures Economic variables ought to be variables that deal with the bottom line and the flow of money. and land use/land cover. business climate factors. energy consumption. Many of the traditional sustainability measures. It could look at income or expenditures. natural resources. solid and toxic waste. Specific examples include:  Sulfur dioxide concentration  Concentration of nitrogen oxides  Selected priority pollutants  Excessive nutrients  Electricity consumption  Fossil fuel consumption  Solid waste management . having long-range trends available for each of the environmental variables would help organizations identify the impacts a project or policy would have on the area.availability will drive the TBL calculations.

For local or community-based projects. quality of life.4 and having stakeholders rank and weigh components of a sustainability framework according to community priorities. There are several similar approaches to secure stakeholder participation and input in designing the TBL framework: developing a decision matrix to incorporate public preferences into project planning and decision-making. but are also available at the local or community level. the TBL measures of success are best determined locally. equity and access to social resources.3 using a "narrative format" to solicit shareholder participation and comprehensive project evaluation. health and well-being. a community may consider an important measure of success for an entrepreneurial development program to be the number of woman-owned companies formed over . and social capital.5 For example. Hazardous waste management  Change in land use/land cover Social Measures Social variables refer to social dimensions of a community or region and could include measurements of education. However. as the geographic scope and the nature of the project narrow. The examples listed below are a small snippet of potential variables:  Unemployment rate  Female labor force participation rate  Median household income  Relative poverty  Percentage of population with a post-secondary degree or certificate  Average commute time  Violent crimes per capita  Health-adjusted life expectancy Data for many of these measures are collected at the state and national levels. the set of appropriate measures can change. Many are appropriate for a community to use when constructing a TBL.

social and environmental factors. Ultimately. dollar-denominated measure. but differ with regard to the way they measure the three categories of outcomes. Businesses The TBL and its core value of sustainability have become compelling in the business world due to accumulating anecdotal evidence of greater long-term . consists of 25 variables that encompass economic. it will be the organization's responsibility to produce a final set of measures applicable to the task at hand.9 Researchers in environmental policy argue that the three categories—economic.6 Minnesota developed its own progress indicator comprised of 42 variables that focused on the goals of a healthy economy and gauged progress in achieving these goals. These are not constrained by strict economic theory for measuring changes in social welfare. for example. Those variables are converted into monetary units and summed into a single. Proponents who have developed and applied sustainability assessment frameworks like the TBL encountered many challenges. policy or economic development project may have and to assess policy options and tradeoffs. Who Uses the Triple Bottom Line? Businesses.a five-year time period.7 There is a large body of literature on integrated assessment 8 and sustainability measures that grew out of the disciplines that measure environmental impact. social and environmental—need to be integrated in order to see the complete picture of the consequences that a regulation. how to make an index that is both comprehensive and meaningful and how to identify suitable data for the variables that compose the index. nonprofits and governments are motivated by the principles of economic. nonprofits and government entities alike can all use the TBL. Variations of the Triple Bottom Line Measurement The application of the TBL by businesses. The Genuine Progress Indicator (GPI). environmental and social sustainability. chief among them.

profitability. Cascade Engineering. one can see how they measure sustainability using the TBL concept. And instant meant waiting a minute or two. for example. reducing waste from packaging can also reduce costs. it disrupts the market and forces businesses in that market to radically change their business or suffer serious consequences. Proctor and Gamble. Among the firms that have been exemplars of these approaches are General Electric.10 Although these companies do not have an index-based TBL. . Unilever. A good example of a disruptive innovation is digital imagery. An instant photographic image was often called a “Polaroid” – after the world’s leading manufacturer of instant film and camera products. a private firm that does not need to file the detailed financial paperwork of public companies. has identified the following variables for their TBL scorecard:  Economic  Amount of taxes paid  Social  Average hours of training/employee  From welfare to career retention  Charitable contributions  Environmental/Safety  Safety incident rate  Lost/restricted workday rate  Sales dollars per kilowatt hours  Greenhouse gas emissions  Use of post-consumer and industrial recycled material  Water consumption  Amount of waste to landfill Disruptive innovation is a term coined by Clayton Christensen that describes a new product or service that is so innovative. For example. Until a very few years ago. 3M andCascade Engineering. virtual all photography was film-based.