Case Study: LEISURENET: an unfit empire

Title
LEISURENET: an unfit empire 

Author
Townsend, S; Thomas, A 

Pages
27 

Product Type
 

Reference #
704-066-1 

Teaching Note
 

Institute
Wits Business School, University of the Witwatersrand 

Setting
South Africa 

Year
2004 

Keywords
Corporate governance; Ethics



Summary/
Abstract
On the evening of 6 October 2002 'Mr Fix-It', Peter Flack, a Partner in Coronation FRM, a firm of corporate turnaround specialists, was preparing for his testimony at the hearing into the collapse of LeisureNet, a company with the majority of its interests in the fitness industry, and he wanted to prepare properly for the next day. LeisureNet had been placed under provisional liquidation exactly two years ago, with contingent liabilities of almost Rand 1 billion. Flack, in his capacity as acting CEO (Chief Executive Officer) at the time, had been involved in making that final decision to close down the company - a decision that had a ripple effect on the lives of thousands of people. At the time, it was the biggest corporate crash ever in South Africa. The question of what exactly had gone wrong at LeisureNet was certain to be raised the next day at the hearing. Coronation FRM believed that every organisation required four basic ingredients for success: (1) leadership; (2) a strategic plan; (3) a management team capable of implementing the strategic plan; and (4) an action plan which broke the strategic plan down into measurable bits. On the face of it these ingredients appeared to be in place in LeisureNet's heyday, but were they really?

 

Back


Follow us on LinkedIn LinkedIn

The Impact of AABS Video

"The impact of AABS Video" was filmed at the Gordon Institute of Business Science, Johannesburg and at the University of Cape Town Graduate School of Business, Cape Town during the AABS Members Meeting and Conference 2011.

 

View The Imact of AABS Video

AABS is proud to announce our new project: African Agribusines Network (AAgri.net). Visit the website.

Reports on the AABS Members Meeting 2011 and Responsible Management in Africa Conference 2011