Successful Implementation of Turnaround Strategies in the Manufacturing Sector in Harare, Zimbabwe- Impediments and Challenges Faced
International Journal of Accounting, Finance and Risk Management
Volume 1, Issue 1, November 2016, Pages: 1-10
Received: Aug. 29, 2016; Accepted: Oct. 20, 2016; Published: Nov. 8, 2016
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Bongani Ngwenya, Department of Postgraduate Studies, Faculty of Business, Solusi University, Bulawayo, Zimbabwe
V. Sibanda, Department of Postgraduate Studies, Faculty of Commerce, National University of Science and Technology, Bulawayo, Zimbabwe
C. Zana, Department of Postgraduate Studies, Faculty of Commerce, National University of Science and Technology, Bulawayo, Zimbabwe
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The concept of turnaround strategy seeks to bring back profitability in a declining business. In Zimbabwe, ever since the government adopted multi-currency system industries have failed to realise any meaningful positive performance. The manufacturing sector was the most affected. It is against this background that the researchers sought to explore the extent of successful implementation of turnaround strategies in the manufacturing sector in Harare over the period 2009 to 2014 on back drop of impediments and challenges faced. The study employed triangulation approach design as it was found to be the most suitable. A stratified random sampling was used to select companies for the purposes of the study across the 14 sub-sectors of the manufacturing sector in Zimbabwe. A minimum of 2 respondents per company was selected. Data was collected using questionnaires which were administered physically and electronically. In-depth interviews were also conducted for chief executive officers and managing directors. The findings of the study were that companies in the manufacturing sector implemented turnaround strategies that were focussed on cutting down costs, with retrenchments yielding no positive results. Toxic organisational cultures, misaligned organisational structures, working capital constraints, old and dilapidated machinery, liquidity crisis, and choking government policies have been identified as major internal and external challenges affecting implementation of turnaround strategies. The study recommends that top management in the manufacturing industry should conduct concrete situational analysis in order to obtain in-depth understanding of the underlying problems facing their organisations. Competent management should also be put in place. The manufacturing companies are also recommended to engage services of turnaround specialists, establish strategic alliances, engage all stakeholders and also strive to seek cost competitiveness. The study further recommends that the government should take an active role in ensuring that an enabling environment has exist to allow firms in the manufacturing sector to recover from the economic decline.
Turnaround Strategies, Manufacturing Sector, Performance, Cost of Capital, Strategic Alliances, Internal and External Environment
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Bongani Ngwenya, V. Sibanda, C. Zana, Successful Implementation of Turnaround Strategies in the Manufacturing Sector in Harare, Zimbabwe- Impediments and Challenges Faced, International Journal of Accounting, Finance and Risk Management. Vol. 1, No. 1, 2016, pp. 1-10. doi: 10.11648/j.ijafrm.20160101.11
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