...Kepler Universität Linz Institut für Controlling und Consulting Altenberger Straße 69 4040 Linz Austria Stefan.mayr@jku.at Keywords: Corporate responsibility, corporate restructuring, enterprise crisis, bankruptcy 1238 Abstract Discourse regarding ethics and corporate responsibility arose in the last years linked with an increasing number of accounting fraud scandals. The recent financial crisis has had a lasting negative influence on corporate profits. Companies have had to satisfy the interests of several stakeholders, such as its employees, banks, customers and the community, and at the same time successfully manage the consequences of the crisis. An empirical qualitative study which was conducted in Austria in 2008 is presented in this paper aimed at investigating business ethics and crisis management. The stakeholder theory will be used as a reference framework. This paper concludes with lessons that can be learned and political recommendations and policies put forth to grant failed businesses a second chance. 1. Introduction In the past few years, an increasing number of fraud cases and accounting scandals is linked to fierce discourse with respect to ethics and corporate accountability. Business ethics has likewise become a current research subject in science (Homan/Lütge, 2005; VHB, 2008). Discussions concerning corporate responsibility can be examined from different standpoints such as theological, philosophical or economical perspectives, and moreover...
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...Maidenform Restructuring: An Analysis of its Benefits and Negative Effects Introduction Maidenform is an intimate apparel manufacturing company that specializes in women’s undergarments. It recently revealed a massive restructuring plan in order to reduce on its forecasted losses for the first quarter of the year. This essay aims at providing an in depth analysis of the Maidenform restructuring plan with particular attention on the extensive effects of the process. The Restructuring Plan The restructuring will take place over 2013. Over the year, the company plans to close all unprofitable segments of businesses. These unprofitable lines require considerable resources but still yield an unappreciable level of profits. Additionally, Maidenform plans to close the Charm brand along with its 10 retail stores along with ‘de-emphasizing.’ These plans will reduce overall sales by close to US$20 million over the financial year 2013. Maidenform plans to channel all resources from the exited businesses to its key priorities. On the other hand, the company intends to undertake aggressive marketing. It also wants to reduce its stock keeping unit (SKU) that it offers by about 20 percent before the year lapses. In essence, the strategy revolves around narrowing of operations to include profitable segments of the business only. It plans to reduce overhead costs by $5 million via Maidenform’s supply chain. Most corporate restructuring plans occur so that the firm...
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...ONE 1.0 INTRODUCTION 1. Background of the study Restructuring is A general term for major corporate changes aimed at greater efficiency and adaptation to changing markets. Spin-Offs, Recapitalisations, Strategic Buyouts and major management realignments are all developments frequently associated with corporate restructurings (Financial & Investment Dictionary, Barron’s, 2000). The verb restructure has one meaning: to reconstruct or form anew or provide with a new structure. Restructuring is significant modification made to the debt, operations or structure of a company. This type of corporate action is usually made when there are significant problems in a company, which are causing some form of financial harm and putting the overall business in jeopardy. The hope is that through restructuring, a company can eliminate financial harm and improve the business. (Investment Dictionary, Investopedia 2002). Restructuring is a method of raising organisational efficiency by questioning every stage of key operational processes to see if they still achieve what is required of them in terms of cost, quality service and speed. Restructuring is the corporate management term for the act of partially dismantling and reorganizing a company for the purpose of making it more efficient and therefore more profitable. It generally involves selling off portions of the company and making severe staff reductions. Restructuring is often done as part of a bankruptcy or of a takeover by another...
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...1. Should he or the others attempt to respond to negative reactions to the composition of the new Executive Committee? What should they say? To whom? When? How? It is extremely important that Voser respond to the negative reactions to the composition of new Executive Committee. He should respond because the composition of the committee does not reflect the organization's mission of Diversity and Inclusion (D&I). The committee composition is not in line with Shell's corporate culture. The employees of Shell are beginning to show signs of dissatisfaction, distrust, anger and disbelief. This situation has to be carefully handled and managed by Voser to prevent it from worsening. It can easily become much worse if not handled properly and promptly. Voser's commitment to D&I has now been questioned. Therefore I believe he should try to gain the trust of his employees again by attempting to clarify his position. Voser needs to hold a meeting with senior and middle level of management where he should address and clarify his position and actions. He needs to communicate his efforts and achievements of getting D&I implemented. Voser should explain how hard he worked towards achieving the objective of implementing diversity and inclusion in organization. He needs to mention all of the difficulties which came in his way of achieving his objective and commitment while discussing the actions and major steps he took to make D&I a reality. Voser left no stone unturned in his commitment...
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...Use an example of your choice to discuss how ‘corporate restructuring’ transformed market, productive and financial performance. Companies quite often have a need to contract and downsize their operations, or redesign one of the aspects, which might be due to different reasons, such as external factors, increase level of competitiveness or to change company’s direction. All the changes that the company might implement are called corporate restructuring. Usually, corporate restructuring is used when a company’s original structure reached the point when it doesn’t generate the profit, and is no longer efficient. The main aim of a corporate restructuring is to raise company’s profitability and internal operations (Froud 2006). I decided to use Caterpillar example to analyse their need of corporate restructuring and its outcomes. Caterpillar Inc. is a $30 billion global company which is known as a manufacturer of large earth-moving equipment and large construction (Neilson & Pasternack 2005). Caterpillar survived from very difficult times in 1980s, mainly because its product reached maturity level, where customers were no longer interested in it and also the CEO of that company did not take into account very important factor – external environment. In 1980s a lot of companies lost their sales because global recession hit the economy and inflation rates grew very quickly. Therefore, Caterpillar’s structure couldn’t handle the pressure and had to be reorganised. Moreover, Caterpillar...
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...UNSW BUSINESS SCHOOL International Human Resource Management MGMT 5949 Student Id Number-Z5102653 Student Name-Yash Patwari Case analysis on- Global Diversity and Inclusion at Royal Dutch Shell I declare that this assessment item is my own work, except where acknowledged, and has not been submitted for academic credit elsewhere, and acknowledge that the assessor of this item may, for the purpose of assessing this item: * Reproduce this assessment item and provide a copy to another member of the University and/or * Communicate a copy of this assessment item to a plagiarism checking service (which may then retain a copy of the assessment item on its database for the purpose of future plagiarism checking). I certify that I have read and understood the University Rules in respect of Student Academic Misconduct. Signed by- Yash Patwari Case Overview Royal Dutch Shell is an Oil and Gas company created in 1907 through the alliance of the oil company Royal Dutch Petroleum Company and the British Shell Transport and Trading Company. Since mid-1990’s Shell started giving attention to Diversity and Inclusion (D&I). Shell has been placing great interest on D&I since that time. The company was restructured in 2005 and Jeroen Van Der Veer became the first CEO of the company. During that time rising oil prices helped Shell’s expansion projects. Since the 2000s Shell had been building its D&I around three areas: Talent, Leadership, and Competitiveness...
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...Strategic Management Human resources can play a very large role in a company during corporate restructuring or during a merger/acquisition. Many companies depend on human resources for recruitment, retention, training, development, employee performance management, regulatory compliance, and when it comes to dealing with compensation and benefits for employees. This paper will describe human resources role as a strategic partner in corporate restructuring of a health care facility as well as human resources functional responsibilities as mentioned above. When a corporation is in the process of being restructured, they must depend greatly upon their human resources management to recruit and retain the employees for the company. Corporate restructuring can be a stressful time for everyone that is involved including all employees. Human resources must do their best to retain the employees who are currently employed. They do this by keeping them happy so that they stay with the company. Human resources must also hire new employees on an as-needed basis is a company is being restructured because they may be growing and new positions may be opening. When new employees are hired, they need to be trained accordingly. To be trained for a new position within a company requires the human resources to provide the necessary materials and personnel to properly train the individuals. Training usually consists of some type of classroom and paper materials, and so many hours of on-the-job...
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...bankruptcy in 2012 and subsequently entered the restructuring phase after three decades of consistent decline in its core film business (Kodak, 2015). It is evident from various sources that Kodak’s failure in seizing the opportunity in the rising digital photography market stem from its organization’s internal structure’s failures. It will be explored in this essay the driving factors that led to its restructuring and emergence from bankruptcy in 2013. Kodak had enjoyed decades of success, notably achieving US$10 Billion sales in 1981, from dominating the film photography market since George Eastman founded the company in...
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... Vol. 01 – Issue: 01 (Jan - Jun 2011) CORPORATE RESTRUCTURING - A FINANCIAL STRATEGY Vikas Srivastava1 Ms. Ghausia Mushtaq2 ABSTRACT This paper serves the very purpose of defining the corporate restructuring as a financial strategy adopted towards the financial development and enhancement of an organization suffering from a major set back at any level of operation. Technological advancement and environmental or political – legal changes and polices enable the companies to move in the direction routed by the changing environment of the new era. There is a lot of competition in almost all respect as the there is not only the survival of the fittest but also the wittiest. In phase of rapid industrialization, only those organization will survive which will create and able to deliver the maximum value as satisfaction to their customers. The corporate restructuring, as the financial strategy, will make an effect on the overall cost of capital or will have an effort to bring it to the lowest so that the changes with respect to various operational and functional activities of the organization will be taken care of by the organizational changes. Corporate restructuring is one of the most complex and fundamental phenomena that management experiences. Each company has two opposing objectives from which it has to choose: to diversify or to refocus on its core business. Financial restructuring involves the redeployment of corporate assets through divestures of business lines...
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...O C C A S I O N A L PA P E R 178 IMF-Supported Programs in Indonesia, Korea, and Thailand A Preliminary Assessment Timothy Lane, Atish Ghosh, Javier Hamann, Steven Phillips, Marianne Schulze-Ghattas, and Tsidi Tsikata INTERNATIONAL MONETARY FUND Washington DC 1999 © 1999 International Monetary Fund Production: IMF Graphics Section Typesetting: Alicia Etchebarne-Bourdin Cataloging-in-Publication Data IMF-supported programs in Indonesia, Korea, and Thailand : a preliminary assessment / by Timothy Lane . . . [et al.]. — [Washington DC : International Monetary Fund], 1999. p. cm. — (Occasional paper, 0251-6365); no. 178 Includes bibliographical references. ISBN 1-55775-783-6 1. Indonesia—Economic policy. 2. Korea—Economic policy. 3. Thailand—Economic policy. 4. International Monetary Fund—Indonesia. 5. International Monetary Fund—Korea. 6. International Monetary Fund—Thailand. I. Lane, Timothy D. (Timothy David), 1955- II. Occasional paper (International Monetary Fund); no. 178. HC447.I44 1999 Price: US$18.00 (US$15.00 to full-time faculty members and students at universities and colleges) Please send orders to: International Monetary Fund, Publication Services 700 19th Street, N.W., Washington, D.C. 20431, U.S.A. Tel.: (202) 623-7430 Telefax: (202) 623-7201 E-mail: publications@imf.org Internet: http://www.imf.org recycled paper Contents Preface I Overview Timothy Lane and Marianne Schulze-Ghattas References II Background to the Crisis Javier Hamann...
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...fishery authority decided to carry out downsizing for the fishing company. Discuss the effects of such step on the welfare of the fishery community in the area. INTRODUCTION Downsizing refers to the permanent reduction of a company's workforce and is generally associated with corporate reorganization, or creating a "leaner, meaner" company. Downsizings such as these are also commonly called reorganizing, reengineering, restructuring, or rightsizing. Regardless of the label applied, however, downsizing essentially refers to layoffs that may or may not be accompanied by systematic restructuring programs, such as staff reductions, departmental consolidations, plant or office closings, or other forms of reducing payroll expenses. In essence, restructuring efforts attempt to increase the amount of work output relative to the amount of work input. Downsizings such as these are also commonly called reorganizing, reengineering, restructuring, or rightsizing. Regardless of the label applied, however, downsizing essentially refers to layoffs that may or may not be accompanied by systematic restructuring programs, such as staff...
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...How To Make Restructuring Work for Your Company Published: | October 1, 2001 | Author: | Stuart C. Gilson | Executive Summary: A bungled corporate restructuring can turn a good idea into disaster. In an excerpt from his new book, HBS professor Stuart Gilson outlines the keys for a successful corporate makeover. Plus: Gilson Q&A. About Faculty in this Article: Stuart Gilson is the Steven R. Fenster Professor of Business Administration at Harvard Business School. * More Working Knowledge from Stuart C. Gilson * Stuart C. Gilson - Faculty Research Page Editor's Note: The following excerpt is taken from the "Lessons of Restructuring" section of Gilson's introduction to Creating Value through Corporate Restructuring. Although the case studies in this book span a wide range of companies, industries, and contexts, some common issues and themes emerge. Taken together, they suggest there are three critical hurdles or challenges that management faces in any restructuring program: 1. Design. What type of restructuring is appropriate for dealing with the specific challenge, problem, or opportunity that the company faces? 2. Execution. How should the restructuring process be managed and the many barriers to restructuring overcome so that as much value is created as possible? 3. Marketing. How should the restructuring be explained and portrayed to investors so that value created inside the company is fully credited to its stock price? Failure to address any one of...
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...Restructuring in the Oil and Gas Industry: Implications for HR Practitioners BY ISAH MOHAMMED ABBASS Department of Political Science, Ahmadu Bello University, Zaria, Nigeria isaabbas@yahoo.com Abstract Management of people and organizations requires some specialist attributes. In managing these vital resources, there has to be a distinctive philosophy of providing and enhancing people-oriented organizational programmes. Restructuring is one of such activities or programmes. This activity is essentially designed to reconstruct or reorganize the structure of the business activities to suit objectives, purpose as well as circumstances of the job. Oil and gas industry is a potential sector of the business environment that is more prone to constant but periodic restructuring due to its dynamics. This Paper explores the structure and work environment in some oil and gas industry in attempts to reorganize or restructure them. These attempts are highlighted with implications for organizations’ employees, stakeholders as well as the HR Practitioners. An insight into the restructuring of PTI has been buttressed as a specific example on how the modern organizational perspectives have been put in place against the orthodox method in order to bring efficiency and effectiveness in the operational activities with resource centered HR Practitioners in focus. Introduction The theme: Restructuring in the Oil and Gas Industry: Implications for HR Practitioners is an engaging...
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...information (stock prices, bond prices, financial statements, corporate events, etc.) is observable to researchers. Through asset selloffs, the parent company takes out part or whole of assets in the wholly owned divisions or subsidiaries and sells to third party for cash or distribute the ownership shares to existing shareholders as stock dividend so that the new entity’s operation is separate from the parent’s. In a spinoff, a new corporate is created and its shares are transferred to existing shareholders on a pro rata basis and publicly traded on stock exchanges which may or may not be different from where the parent is listed. In contrast to non-cash-involvement characteristic of a spinoff, an equity carveout is an initial public offering (IPO) of a portion of the parent company to outside investors in exchange for cash. Usually parent firms hold a minority interest in the carved-out subsidiaries. Other than corporate restructuring characteristic as shown in a spinoff, an equity carveout transaction also involves management’s financing decision since cash plays a role in. In general, spinoff and equity carveout are regarded as the reversed transactions of stock offer and cash offer in merger deals, respectively. A rich body of previous research activity has been made on spinoff and equity carveout and brought about fruitful results. However, little has been done as to comparing these two corporate restructuring mechanisms...
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...Organizational Downsizing Techniques and Handling Layoffs Team 1 Christina Berardi Bridget Quinn-Carey Tung-Yueh, Lee Over the last two decades, organizational downsizing has been a key management strategy favored by many organizations attempting to cope with fundamental and structural changes in the shifting economy. In the mid-1980’s, downsizing was implemented primarily by companies experiencing difficult economic times (Gandolfi, 2006). Companies hoped to cut costs and improve performance. By the late-1980’s, it developed into a proactive restructuring strategy for a multitude of organizations. Furthermore, since then, organizational downsizing has now transformed the corporate landscape and changed the lives of hundreds of millions of individuals around the world (Gandolfi, 2006). There are several definitions that have been developed to effectively define the phenomenon of organizational downsizing. To sum it up in one sentence, organizational downsizing refers to a set of activities, taken on by the core management of an organization, designed to improve organizational efficiency, productivity, and competitiveness. It represents a management strategy that affects three components: (a) the size of the firm’s workforce, (b) the costs, and (c) the work processes. On the surface, downsizing can be interpreted as merely a reduction in organizational size, and the process is a chaotic and uncertain experience...
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