Moderating effects of government assistance & turnaround strategies: a research on private manufacturing companies

There were many cases in corporate turnaround that had seen the influence of government assistance in influencing the process of recuperating ailing firms. However to what extent such assistance positively influenced the outcome of turnaround result are still lacking in the literature. The objective of this paper is to investigate the moderating effect of government assistance towards the improvement of business performance of turnaround companies. Analysis of logistic regression was used to investigate the effect of retrenchment and product-market refocusing strategy and the combination effect of government assistance as a moderator towards the improvement of business performance of turnaround firms. The sample consists of 135 exporter-manufacturing companies listed in the Exporter Directory of the Province of North Sumatra, Indonesia. The study found partial support in the moderating effects of government assistance and firm size and their influence in the relationship between strategy and successful turnaround. The study also found that Product-Market refocusing is one of the important strategies to be implemented during turnaround.

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Corporate Turnaround Turnaround Strategies ,

Logistic Regression Moderating Effect ,

Government Assistance ,