The Role of Management in the Turnaround Process

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Abstract

This thesis is entitled The Role of Management in the Turnaround Process and is presented for the degree of Doctor of Business Administration at the University of Manchester by Ian Roberts in April 2015. Inquiry into turnaround has largely has been carried forward in two broad areas of study: strategy and management. Strategy research has attempted to identify a single or limited number of strategies which apply in all turnaround situations, while management studies have concentrated on managers themselves or some of the techniques they employ. Neither school has systematically analysed how turnarounds are actually implemented in dysfunctional organisations and both schools are weak in extant theory. As a consequence, a holistic explanation of the process leading from crisis to viability is lacking. This thesis addresses these lacunae in three ways. Firstly, it provides a systematic study of how professional turnaround managers implement the turnaround process over time. Secondly, it applies a unique and complementary mix of extant theory which addresses both cognitive and organisational aspects of strategy formulation and implementation. Thirdly, it presents a holistic turnaround model based on six core constructs which are argued to be necessary and sufficient to explain the dynamics of the turnaround process. The thesis adopts a mixed-methods approach. A survey is used in order to gather data from turnaround professionals on implementation methods. This data is then subjected to statistical analysis in order to identify the most important factors for implementation. These concepts are then blended into a conceptual framework which is tested for its explanatory and predictive power on a matched pair of turnaround case studies of two mid-sized UK manufacturing companies in the household goods sector, one of which executed a successful turnaround and one of which failed in the attempt. The model is able to explain and predict the outcome in both cases. The thesis is one of only a handful of turnaround studies which employs a rigorous case study research protocol. Its principal contribution is that of a middle range turnaround theory of the causal factors leading from organisational crisis to dissolution or viability.

Keyword(s)

Crisis; Cybernetics; Implementation; Management; Mental models; Strategic fit; Strategy; Turnaround

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