Factors influencing Brazilian sugar and ethanol refineries’ failure

Abstract

Purpose This study aims to examine the dimensions of organisational failure in the Brazilian sugarcane and ethanol refineries, as reported in judicial recovery plans. Design/methodology/approach This paper follows a qualitative, inductive approach that uses content analysis to examine the details of recovery plans. Besides, a cause-and-effect relationship diagram is proposed, making it possible to identify the interconnections between the identified variables. Findings There is evidence that organisational failures are not a linear outcome. Organisational failures are complex and occur because of several factors, often interdependent and operating at different levels. Research limitations/implications Organisational failures basically have three interrelated levels: the macro-level (external environment), the meso-level (organisational environment) and the micro-level (associated with the decision-maker). The relationship between these levels is not trivial and involves coordinated research efforts. Practical implications Organisations must consider all types of failure levels when developing business reorganisation plans. Reorganisation plans are more than a formal document to achieve judicial recovery, as they should incorporate strategic factors. Social implications Organisational failures are regularity in organisations’ day-to-day. Understanding failure’s sources is vital to design firms’ strategies and public policies. Originality/value The study of organisational failure involves the analysis of complex and multidimensional phenomena. Judicial recovery plans are the means for companies to get a second chance. To that end, this paper addresses the sources of organisational failures through the lens of judicial plans.