Crafting Turnaround Business Model
Green Plantation Company Ltd
Green plantation Ltd has been operating in Sri Lanka since 1920 as a government owned Plantation
Company. Currently, it has four plantations in different geographical areas namely Kandy, Matale, Galle
and Chilaw. Each plantation has its own investments namely Tea, Rubber, Cinnamon and Coconut
respectively. The Green Plantation Ltd had recorded losses during the last 5 years of time due to number
of managerial issues not found yet, and therefore, the Chairman has appointed a panel of auditors to
review and produce a report on managerial issues currently exist. The issued report had found following
circumstances exist in Green Plantation Ltd.

All the plantation companies record their income and expenses their own and do not report to
the head office located at Colombo.

The Chief Administration manager does not know anything about those of plantation companies
and he has said that those plantation managers had been given full authority to run the
companies as they wish, and it is enough him to meet those managers at annual business
meeting only.

Lower level employees are not in permanent carders and informal groups of employees
frequently clash with plantation managers for their rights. They always claim for overtime
payments by producing bogus reports.

Plantation managers had found a sever issue of not having supportive managers to supervise
lower level staff, and it had made rooms to lower level staff to do plenty of malpractices.

All the harvests are sold at cheaper price due to not having a proper marketing and sales
system, and the plantation managers had said to auditors “ it is not our duty to do marketing,
we are only supervisors”.

Overhead cost factors are very high even though it records a sales growth compared to last
financial year referred to all four investments.
Market performances of investments ( In the region)
investment
Sales growth
Market share
Growth
Close competitor’s
share growth
Coconut
12%
2%
7%
Rubber
13%
1%
6%
market
Tea
5%
27%
19%
Cinnamon
5%
12%
7%
However, it has found that this company has a big potential of local and foreign market, and
government support has been a definite advantage to expand its future businesses. But this company
needs to do a proper systematic organizing process to implement the new plans. The entire financial
controlling activities have not been properly planed due to complete decentralization. However, still
there are nearly 1500 of workers being well skilled in agricultural sector activities. But it has only
cultivated 60% of lands owned to Green Plantation Ltd. One of the consultants had given a report to
management board by reviewing the potentials and productivity improvement opportunities to Green
Plantation Ltd recently. One of the key matters was to focus higher productive cultivations based on
climate conditions in respective areas. But, plant managers refused it by stating that they need to have
multi diversified product ranges to survive the income and avoiding the risk of depending on one corp.
However, a new idea was aroused referring diversifying to new businesses by using the same lands and
labors to grow the future business opportunities.
Finally top management agreed to provide machineries and other supports for the new business
projects and renovate the existing businesses of each plant. The progress report of investment portfolio
analysis reviewed that overhead costs centers are at a high level due to repetition of same expenses
pertained to HR, Administration and Supply Processes. The capacity utilization has been found as
minimal point due to seasonal effects and overstaff in off-session situations. It was found that the
customers do largely bargain over the Green Plantation on price and they have exploited the market
opportunities what Green Plantation should have penetrated by producing branded output to local and
foreign market. The policy of being focused to generic type of products has desperately impacted to
Green Plantation in terms of value margin. Usually, Green Plantation contacts to any available buyer
during the season to sell the harvested items at going rate price. When this matter was questioned to
plantation managers, the simple response was “otherwise, it requires warehouse and it would find some
extra cost and labor requirement”.
Note: You are supposed to come up with a comprehensive business key issue analysis and key strategic
and functional contexts to be addressed in proposing long-term solutions. You may introduce a
turnaround business model for this case study.