Thesis, Graduate (Master in Management)--University of the Philippines Mindanao, December 2008.

Confidential.

Southern Tropical Fruit Incorporated (STFI) is a medium-sized company with a total asset of Php 52 million. The company is a grower of pineapple and has expanded its operation to highland bananas and Senorita bananas for its only buyer, Del Monte Fresh Produce (Philippines)Inc. In 2004, the decision to diversify brought the company to its knees in 2007 with a net loss of PhP 1.3 million. Without a direction and vision but with much asset and financial strength, the company lost its way in the complexity of the forces of global environment (as in the case of weakening of US dollar resulting in a net loss of PhP 2 million) marred with internal weaknesses such as poor leadership and lack of internal controls. This strategic plan was conceptualized to correct and give direction to STFI, to set goals and concretize them in order to be implemented, set the company's internal controls and as a soul-searching activity, discover the values that held the company together and discover the reason for its existence. The findings of the analysis of external and internal environments had been quantified using the SWOT matrix and QSPM in order to arrive at a logical strategic option for STFI. The results of the analysis showed that the emerging strategy and most needed was to recover from its losses through recoup of its internal strengths i.e TURNAROUND strategy. The opportunities available for STFI will never be realized as long as the internal controls and management remained weak. Hence, turnaround strategy was recommended for implementation. The strategy outlined a 3-year program. Just like a soldier wounded in battle, it needs to be healed, strengthened and rearmed to regain its position in the battlefield. The first year of the implementation focused on cost-cutting measures, operational efficiency, policy formulation and setting of goals, reduction in non-performing assets and values integration. The financial and operational metrics were set to monitor the performance of the strategy. At the end of the year, a reckoning of the effectiveness of the TURNAROUND strategy was also designed either to pursue it or to go to the next mode of action ? DIVESTITURE strategy. The salient feature of divestiture strategy is to remove part of a business unit or whole business unit in order to stop the bleeding. This strategy focused on banana operations. The results of the internal and external analysis showed that the banana venture drained the company resources including the income of the profitable pineapple venture. In order to stop the bleeding, the company ought to amputate and seal the bleeding unit or drain the lifeblood of the company. It is therefore a must for STFI to summon its values of cooperation, trust and honesty and mutual aid in order to recover from the financial losses. Failure to meet the performance metrics using a balanced scoreboard means that the company will have to face a more painful treatment.