The Meaning of Identification of True Causes of Organizational Crisis

Drago Dubrovski

Management, 2010, vol. 5, issue 1, 037-052

Abstract: An analysis of the true causes for the emergence of a crisis or serious troubles in the company is of extreme significance, since those domains, regarding which the effects are to be limited or done away with, are identified by utilizing the analysis. Dealing with erroneous causes represents a further useless loss of time, money and efforts, which only makes the critical situation more acute. Although there may be a state of crisis in the company, it can also be affected by various interrelated external and internal causes, the essence of which lies in the management of the company or their mistakes, which can be divided into three big groups, each of them prevailing in a certain economic period. In the empirical part of this paper, by using the sample of 107 domestic companies, three defined hypotheses have been examined and confirmed. The final finding is that global crisis cannot be the only factor leading to serious troubles or acute crisis in an individual company, as such an unfavorable situation is also a consequence of management mistakes, particularly the omission of correct and timely acting.

Keywords: crisis; internal causes; management mistakes; global crisis (search for similar items in EconPapers)
Date: 2010
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