Blair et al. (1991) offers a guideline of how to conduct successful restructuring that can result to desired outcomes. These guidelines are: to ensure the company has enough liquidity to operate during implementation of a complete restructuring; produce accurate working capital forecasts; provide open and clear lines of communication with creditors who mostly control the company’s ability to raise financing; and update detailed business plan and consideration.
After getting right these essential steps in restructuring a business there is a need to have key functions reengineered. Reengineering of the key functions shall include: stay bonus, sale of underutilized assets like brands or patents, outsourcing of operations from effective third party, moving of operations to lower-cost locations, reorganization of functions such as sales, marketing, and distribution (Shivdasani, 1997). Additionally, there is labor contracts renegotiation to reduce overhead, reduce interest payments by refinancing of corporate debt and lastly there ought to be major public relations campaign through investing in massive advertisements to reposition the company with consumers (Shivdasani, 1997).
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