TURNAROUND

STRATEGY
PRESENTED BY GROUP 9
ADITYA ANAND 19P184
ANIRUDH CHAUHAN 19P18
SHEFALI VERMA 19P221
SHUBHAM VERMA 19P224
VARDAAN MAKHIJA 19P233
VISHAL SHARMA 19P23
WHAT IS TURNAROUND?
The process of bringing an organization from sickness
(declining economic performance for an extended period)
to health (a profitable operation) is called turnaround

DEFINING A SICK FIRM

ACCUMULATED
LOSSES IN ANY FAILED DEBT
FORMULATE A
YEAR TOTALLING REPAYMENT IN 3
STRATEGY TO
50% OR MORE OF CONSECUTIVE
FIGHT IT
ITS AVERAGE NET QUARTERS
WORTH
 INTERNAL CAUSES
PRODCT FAILURE

UNSUSTAINABLE
POOR
DEBT/EQUITY 1
DIVERSIFICATION
RATIOS 2 6

3 5

4
INEFFICIENT FUNCTIONAL OBSOLETE
MANAGERS & TECHNOLOGY
EMPLOYEES
INERTIA IN THE TOP
MANAGEMENT
 EXTERNAL CAUSES
1 COMMODITY PRICE SHOCKS

2 MAJOR TECHNOLOGICAL CHANGE

LOW COST COMPETITORS

3
5
POLITICAL
INTERVANTIONS
4 ADVERSE MARKET ENVIRONMENT
 TURNAROUND STRATEGIES
HUMAN
HUMAN
RESOURCE
RESOURCE
STRATEGIES
STRATEGIES

FINANCIAL
FINANCIAL MARKETING
MARKETING
STRATEGIES
STRATEGIES CLASSIFICATION
CLASSIFICATION STRATEGY
STRATEGY

STRATEGIC/ASSET
STRATEGIC/ASSET OPERATIONAL/
OPERATIONAL/
RESTRUCTURING
RESTRUCTURING PRODUCTION
PRODUCTION
 FINANCIAL
HR STRATEGIES
STRATEGIES

DOWNSIZING EFFORTS CONVERSION OF DEBT

INTO EQUITY
CHANGE IN TOP
MANAGEMENT POSTPONEMENT OF
(QUOTED AS A SUCCESSFUL DEBT MATURITY
TURNAROUND STRATEGY)

COST CUTTING
STAFF RELOCATION
(PRODUCTION,
SELLING, ADMIN.,
OPEN DOOR POLICY
FINANCING, R&D etc.)
INWARD FOCUSED
INWARD FOCUSED
 MARKETING OPERATIONAL
STRATEGIES STRATEGIES
BETTER DEMAND
FORECASTING INVENTORY
MANAGEMENT
ENHANCED FOCUS ON
CUSTOMER SERVICE INCREASED CAPACITY
UTILIZATION
INNOVATIVE
OFFERINGS WASTE REDUCTION

BETTER CRM PROCESS

IMPROVEMENT &
MORE OUTWARD MODERNIZATION
FOCUS THAN INWARD
 ASSET RESTRUCTURING
STRATEGIES

ASSET INVESTMENT ASSET DIVESTMENT

DIVESTMENT OF
STRATEJIC ALLIANCE AND
SUBSIDIARIES / DIVISIONS
JOINT VENTURES
NON CORE ASSETS
ACQUISITIONS ( IF THE
FIRM IS NOT SEVERELY
NON CASH GENERATING
DISTRESSED)
ASSETS
CAPITAL EXPENDITURE
UNPROFITABLE ASSETS
(NOT IF SEVERELY
DISTRESSED)
 INDIA POST INTRODUCTION

• Established in 1766 in the British India

• Offered mail service to all over the country
• An important component of Indian economy
• Number of post offices rose from 23000 in 1947 to 154822 in 2012
• Out of total post offices in India 1,39,040 numbers post offices are in rural areas
which accounts for 89.78% of India’s total post office and remaining 15,782
numbers of post offices situated in urban areas which is only 10.22% of total
numbers of post offices.
• Since early 1990s started facing problems
 CAUSES OF DECLINING PROFITABILITY
OF THE COMPANY

INTERNAL EXTERNAL

• High pay-and-allowance
• The infrastructure is
costs
• Mismatch between product- inadequate in newly
developed urban pockets and
service and price charge
• Mismanagement of in rural areas
• The entry and expansion of
manpower
• Lack of diversification of private sector and other
public sector operators mail,
business
• Outdated technology banking and insurance
• There is a lack of sectors present threat to India
Post.
performance based culture
• Digitization of communication
along with poor monitoring
network also had adversely
systems and ineffectual
impacted India post
internal marketing.
 Recommendations

• The pricing structure has to be revamped as such heavy losses cannot be

sustained. Differential pricing based on location can be considered with the
rural areas getting a subsidy. The other centres would have to be made to pay
the full cost.

• Post office spaces should be leveraged to earn rent. As financial inclusion

includes non-banking products, these can be sold in post offices by the mutual
funds or their agents.

• The existing staff can be trained to sell financial products like insurance and
mutual funds in rural areas and a commission earned by the department.

• The post offices can be integrated with the eNAM initiative where terminals
can be kept in these offices for use by farmers. Further, dak sewaks can be
used to also form a link with the agricultural markets (eNAM) as they have
direct interface with farmers and can be given the responsibility of spreading
awareness as well as be the link with the market prices.