Restructuring / Turnaround Strategies Case Study

The Turnaround of Morgan Stanley

Abstract:
In 2005, the $ 52 billion- Morgan Stanley was among the largest financial services companies in the world. It was also the 30th largest U.S. corporation with 53,760 employees across the globe. Morgan Stanley was popularly called the ‘white shoe’ investment bank due to its association with major corporations and wealthy individuals.

Since 2005, Morgan Stanley, once the leader in investment banking and public stock offering underwritings was losing its leadership position to other US financial services firms. CEO Philip Purcell (Purcell) had been asked to leave Morgan Stanley under a cloud of corporate mis-governance. John Mack was appointed as the new C.E.O. in June 2005.The case talks about various initiatives launched by Mack to turnaround the company and improve its image.

Pedagogical Objectives:

• To understand
• The concepts associated with business organisation of financial services companies
• The issues related to the leadership styles of the C.E.O.s
• The issues related to legal and governance problems faced by a company
• The concepts associated with employee morale and motivation.
• The concepts associated with decentralisation of authority and decision making
• The pros and cons of revival initiatives launched by Morgan Stanley’s new C.E.O. John Mack

Keywords : John Mack; Dean witter; Philip Puurcell; Restructuring / Turnaround Strategies Case Study; investment banking; equity underwriting; retail brokage; asset management