Subject category:
Strategy and General Management
Published by:
Columbia CaseWorks, Columbia Business School
Version: September 6, 2012
Revision date: 11-Apr-2023
Length: 10 pages
Data source: Published sources
Abstract
Most firms fail because they are mismanaged. In a distressed firm, managerial errors are compounded by failing to take corrective actions fast enough. New leadership is usually required, since the managers who dug the hole are rarely suitable for leading the way out. When faced with a distressed company, the turnaround team must decide whether the firm shows enough potential to justify the effort of restructuring.
Teaching and learning
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Abstract
Most firms fail because they are mismanaged. In a distressed firm, managerial errors are compounded by failing to take corrective actions fast enough. New leadership is usually required, since the managers who dug the hole are rarely suitable for leading the way out. When faced with a distressed company, the turnaround team must decide whether the firm shows enough potential to justify the effort of restructuring.