7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

1/6

SICKNESS IN

SMEsDIAGONSIS AND REMEDIES

BY AMRITRAJ D.BANGERA

7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

2/6

DIAGNOSIS TO FIND OUT REASONS FOR SICKNESS IN

SMES

The following seven steps will enable a proper diagnosis of the

organizational sickness

1. Interviewing the people across the organization to have a general feel of

the problem that leads to the sickness.

Workers Suppliers

Customers

2. Hold fact finding sessions to list the known/possible factors contributing to

the sickness.

3. Hold discussions with department/divisional heads to assess the nature &

depth of the department problems

Production

Quality

Conduct of business in various department/divisions

7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

3/6

DIAGNOSIS TO FIND OUT REASONS FOR SICKNESS IN

SMES

4. Setup feedback/monitoring/audit control systems to periodically assess

the performance, deviations and the needed corrections.

5. Implement the use of modern management tools, techniques, information

technology to improve the bottom-line.

JIT Cost control

TQM

Budgetary control/inventory control

6. Plug the loopholes and make the present deficiencies to achieve optimal

production and improved efficiencies.

7. Adopt Business Process Reengineering to do the right things and to

achieve major breakthroughs in

Cost

Quality

profits

7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

4/6

REMEDIAL MEASURES

1. Establishment of a proper management information system for providing

early warning signal from within.

2. Financial institutions and banks should initiate necessary corrective action

for sick or prone to be sick units based on diagnostic studies.

3. Attempt should be made to restore sick units to financial health. If not itshould be wound up.

4. Excessive concern over unemployment resulting from the closure of sick

unit is unwarranted. In such case setting up of national fund for the

purpose and providing retraining for the workers.

5. Setting up special institution The Broad for Financial and Industrial

Reconstruction a single window clearing agency.6. Responsible management for mismanagement of a firm must not be given

any assistance from financial institutions even for new venture.

7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

5/6

REMEDIAL MEASURES

7. In any scheme of reconstructing of sick units all the stock holders should

bear sacrifice on equitable and just basis.

8. Company taking over a sick unit must have the technology, capital and skill

to save it.

9. Debt-equity ratio ought to be realistic. Fiscal policy, too, requiresrationalization.

10.Incentives should be provided to professional managers helping in reviving

sick units.

11.Treatment of capital-intensive units prone to sickness has to on a different

footing than tackling of sickness in industry in general.

7/28/2019 Diagnosis to Find Out Reason for Sickness in SME by Amritraj D Bangera

6/6

THANK YOU