Strategy of purposeful business reduction


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The business reduction strategy is used when the company requires regrouping of forces after the long period of growth. The purposeful reduction of business is necessary if organization aims to increase its efficiency when recessions or cardinal changes in economy take place, for example economy structural reorganization. Realization of this strategy often goes painfully. However the business reduction strategy is the same strategy of company development as growth strategies. In certain circumstances it is impossible to avoid business reduction, as it is the unique strategy of business renovation.		Play Demo
Liquidation strategy is the last case of reduction strategy and is carried out when the firm cannot make the further business. The strategy of "harvesting" means the refusal of a long-term business planning in favor of the maximal incomes in short-term prospect. This strategy can be applied to unpromising business which cannot be sold profitably, but can bring profit during harvesting. This strategy means reduction of expenses for purchases and for labor. "Harvesting" strategy is deliberated for gradual reduction of the business to zero and for achievement of maximal total revenue during the reduction. The strategy of cutting down means that organization closes or sells one of its divisions to arrange long-term changes within the basic business. Often this strategy is sufficient for diversified companies when it is necessary to obtain resources for development of more perspective business is carried out. Strategy of expenses decreasing which basic idea is a search of possibilities to reduce costs and performing of actions necessary for expenses reduction (production costs, productivity increasing, reduction of hiring and even personnel dismissal, phase-out of the non-profitable goods and closing of non-profitable capacities).
	The elaborating of proper business reduction strategy is a complicated work which requires collaboration within different specialists from company management and it should be performed in short terms. This work, as well as any other team business collaboration can be facilitated by *real-time task management software*. VIP Task Manager is task and time management groupware which can be used for various purposes within one company.
It can be easily used within any department or for cross-department collaboration because VIP Task Manager features: Tasks (sales plans, business processes, procedures etc.) planning Tasks assignment to employees, reporting and work performance tracking Multiple users real-time simultaneous database access Task List, Task Tree, Scheduler(Calendar) modes Customizable task attributes and workflows Access rights management Instant e-mail and in-systems notifications Read also a new article about process management - project management client-server software for Windows		Play Demo