Declining Causes and Turnaround Strategies in Taiwanese Small- and Medium Sized Enterprises

• Main Authors: Lee Peng, 李芃
• Other Authors: Quey-Jen Yeh
• Format: Others
• Language: en_US
• Published: 2006
• Online Access: http://ndltd.ncl.edu.tw/handle/77941149618994261923

碩士 === 國立成功大學 === 企業管理學系碩博士班 === 94 === Small- and Medium- Sized Enterprises (SMEs) have been the backbone of Taiwan’s economic development since 1960s. Compared to large enterprises in Taiwan, SMEs have higher possibility to end in failure due to limited resources and competitive global market. Therefore, Taiwanese SMEs are strongly recommended to understand how to survive the threat of business downturns and how to turn around the crisis situation. The present study develops a questionnaire to investigate the relationship between their declining causes and turnaround strategies. I tend to find out the turnaround strategies in responding to the internal and external declining causes. There are two major findings in the present study. 1. The Taiwanese SMEs tend to adopt the operating turnaround approaches to deal with the declines attributed to the internal causes; whereas they tend to adopt the strategic turnaround approaches to deal with those due to internal causes. i. The main internal causes are ‘Unqualified professional skills’ and ‘Overly high operating cost.’ The main responding operating approaches to those internal causes are ‘Enhance employees’ ability of administration,’ ‘Cost reduction,’ and ‘Reconsider the quality and operation procedure.’ ii. The main external causes are ‘Increasing competition,’ ‘Global and national economic downturns,’ ‘Difficulty in expanding distribution channels,’ and ‘Market economic downturn.’ The main responding strategic approaches to those external causes are ‘Effectively implement business policy,’ ‘Enhance R&D ability,’ ‘Actively respond to any external change,’ and ‘Have insight into future booms.’ 2. The Taiwanese SMEs tend to adopt two sorts of responding approaches to deal with the external causes. i. When SMEs deal with the business declines due to the controllable, external causes, they adopt market-oriented strategic approaches: ‘Analyze the main competitors,’ ‘Investigate why big clients change their interests,’ ‘Find out niche market to maintain basic profit,’ and ‘Have insight into future boom.’ ii. When SMEs deal with the business decline due to the uncontrollable, external causes, they tend to stay optimistic: ‘Actively respond to any external change.’