Ways Companies die

Sun, Apr 13, 2014

Management Tips

For a human being to die one of several things need to happen:
1. Brain must stop
2. Heart must stop
3. Kidneys must fail

Again these events would occur from hundreds of possible diseases and accidents.

Similarly my question is what needs to happen for a company to die?
1. account payable is so much bankrupty is the only way out
2. in the P/L statement loss is so much with no hope that any further investment can revive it. Closure is the only option otherwise account payable for salaries and rent will increase causing death type 1 which is most painful.
3. Dispute that becomes irreconcilable between management and staffs or between the board members. Then closure is the only only way out.

Does every company that died, die in one of the above 3 ways? Like in the case of human death I believe hundreds of reasons can lead to one of the above three root causes.