Corporate Restructuring

2725 Words May 18th, 2013 11 Pages
Asian Journal of Technology & Management Research [ISSN: 2249 –0892]

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
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01 – Issue: 01 (Jan - Jun 2011)

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Strategic Alliance Franchising IPRS Holding Companies

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Management Buy Out Leverage Buy Out Liquidation

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Reverse Merger Equity Crave Out

The restructuring process can be divided into two broader parts as detailed below:

II.1 HARDWARE RESTRUCTURING It involves redefining, dismantling, or modification of the existing structure of the organization Identification of core competency Flattening of organization layer Downsizing Creation of self directed teams Benchmarking

II. 2 SOFTWARE RESTRUCTURING Communication Organizational Support Trust Stretch – liberating and energizing element of managerial context Empowering people Industry Foresight Training

III.0 REASONS FOR RESTRUCTURING

1. Globalization of business caused restructuring because in this era only the lowest cost producers can survive. 2. Change in fiscal and government polices like deregulation/decontrol has led many companies to go for newer markets 3. Information technology motivates many companies to adopt new technology for technological advancement of the company.

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Asian Journal of Technology & Management Research [ISSN: 2249 –0892]

Vol. 01 – Issue: 01 (Jan - Jun 2011)

4. Irrational divisionalisation of an organization into smaller
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