Just as a competent medical practitioner needs to understand the causes of a disease, a competent turnaround manager must understand the causes of the company's decline.

Much like human beings, companies are perpetually faced with all kinds of viruses or threats to their health, some are internally created whilst others are externally generated. The human body is always battling all these threats so as to maintain the equilibrium of health or homeostasis. Likewise, an organisation that is able to successfully address both internal and external problems (from operational hiccups to market threats) will bound to enjoy corporate health and longevity.

The troubled company usually gets attacked by two types of problems - internal and external viruses.

Many of the internal viruses are generated by the company and are actually within the company's control. They are usually associated with weak management and poor financial system. The onslaught of such viral attacks can lead to bad or untimely business decisions, poor financial control and other related problems. The medical analogy for eliminating internal viruses may merit the use of surgery such as downsizing, restructuring or change.

For example a poll of the members of the Turnaround Management Association, people whose job is to rescue troubled businesses revealed that while 22 percent of turnaround professionals cited increased competition as a reason for business failures, a full 58 percent squarely put the blame on faulty management decision-making. Similarly, other studies have found that internal, rather than external causes are behind up to 90 percent of company failures. Peter Tourtellot, former chairman and now a turnaround manager himself noted that one of the most common mistakes was that troubled companies did not listen to their customers. He also found that communication was sadly lacking in most of the troubled businesses.

Business journalist, Bruce G. Posner cited some of management's most embarrassing mistake. "What kills companies," he said, "has less to do with insufficient money, talent, or information than with something more basic: a shortage of good judgment and understanding at the very top."

External viruses being macro in nature are often beyond the company's control. The entire industry or marketplace or even the whole country may be stricken by the same type of external viruses. The attacks can be silent, swift and often appear non-threatening at the beginning. Examples of external viruses include economic recession, change in technology and consumer behaviour, political turmoil, natural disasters and terrorist attacks.

Such external viruses are harder to eliminate and predict. Sometimes, even having a strong management team is inadequate to cope with external viruses as the corporate culture is unable to manage change expediently. The remedy is to foster a strong and healthy corporate culture that is the immune system of the company.

Thus the best prognosis is to identify the viruses, predict their potential damage and eradicate them before they are able to penetrate, attack and wreak havoc to your system.