Exit strategy
Encyclopedia
An exit strategy is a means of leaving one's current situation, either after a predetermined objective has been achieved, or as a strategy to mitigate failure. An organisation or individual without an exit strategy may be in a quagmire. At worst, an exit strategy will save face; at best, an exit strategy will peg a withdrawal to the achievement of an objective worth more than the cost of continued involvement.
an exit strategy is understood to minimise losses of what military jargon
called blood and treasure (lives and material).
The term was used technically in internal Pentagon
critiques of the Vietnam War
(cf. President Richard Nixon
's promise of Peace With Honor
), but remained obscure to the general public until the Battle of Mogadishu, Somalia
when the U.S. military involvement in that U.N. peacekeeping
operation cost the lives of U.S. troops without a clear objective. Republican
critics of President Bill Clinton
derided him for having no exit strategy, although he had inherited an active military operation from his predecessor, President George H. W. Bush
. The criticism was revived later against the U.S. involvement in the Yugoslav wars
, including peacekeeping operations in Bosnia
and Kosovo
and the Kosovo war
against Serbia.
The term has been adopted by critics of U.S. involvement in Afghanistan
and especially Iraq
. President George W. Bush
was said to have no exit strategy to remove troops from Iraq, and critics worried about the number of Coalition
soldiers and Iraq
i civilian
s who would suffer injury or death as a result. President Barack Obama
also has not yet publicly announced an exit strategy for the troops in Afghanistan.
and strategic management
an exit strategy, exit plan, or strategic withdrawal, is a way to transition one's ownership of a company or the operation of some part of the company. Entrepreneur
s and investor
s devise ways of recouping the capital they have invested in a company. The most common strategy is the sale of equity to someone else through a trade sale
.
Transition companies
are professional mergers and acquisitions
companies that assist Middle Market business owners with their exit strategy. Services offered are often referred to as Transition Management
services.
From time to time, management may decide it is necessary to downsize its operations. This typically involves discontinuing less profitable brand
s, products
, product lines, or operating divisions.
Other types of exit strategy are:
Management buyout
or employee buyout (common in the manufacturing industry)
In warfare
In military strategyMilitary strategy
Military strategy is a set of ideas implemented by military organizations to pursue desired strategic goals. Derived from the Greek strategos, strategy when it appeared in use during the 18th century, was seen in its narrow sense as the "art of the general", 'the art of arrangement' of troops...
an exit strategy is understood to minimise losses of what military jargon
Jargon
Jargon is terminology which is especially defined in relationship to a specific activity, profession, group, or event. The philosophe Condillac observed in 1782 that "Every science requires a special language because every science has its own ideas." As a rationalist member of the Enlightenment he...
called blood and treasure (lives and material).
The term was used technically in internal Pentagon
The Pentagon
The Pentagon is the headquarters of the United States Department of Defense, located in Arlington County, Virginia. As a symbol of the U.S. military, "the Pentagon" is often used metonymically to refer to the Department of Defense rather than the building itself.Designed by the American architect...
critiques of the Vietnam War
Vietnam War
The Vietnam War was a Cold War-era military conflict that occurred in Vietnam, Laos, and Cambodia from 1 November 1955 to the fall of Saigon on 30 April 1975. This war followed the First Indochina War and was fought between North Vietnam, supported by its communist allies, and the government of...
(cf. President Richard Nixon
Richard Nixon
Richard Milhous Nixon was the 37th President of the United States, serving from 1969 to 1974. The only president to resign the office, Nixon had previously served as a US representative and senator from California and as the 36th Vice President of the United States from 1953 to 1961 under...
's promise of Peace With Honor
Peace With Honor
"Peace with Honor" was a phrase U.S. President Richard M. Nixon used in a speech on January 23, 1973 to describe the Paris Peace Accord to end the Vietnam War. The phrase is a variation on a campaign promise Nixon made in 1968: "I pledge to you that we shall have an honorable end to the war in...
), but remained obscure to the general public until the Battle of Mogadishu, Somalia
Somalia
Somalia , officially the Somali Republic and formerly known as the Somali Democratic Republic under Socialist rule, is a country located in the Horn of Africa. Since the outbreak of the Somali Civil War in 1991 there has been no central government control over most of the country's territory...
when the U.S. military involvement in that U.N. peacekeeping
Peacekeeping
Peacekeeping is an activity that aims to create the conditions for lasting peace. It is distinguished from both peacebuilding and peacemaking....
operation cost the lives of U.S. troops without a clear objective. Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
critics of President Bill Clinton
Bill Clinton
William Jefferson "Bill" Clinton is an American politician who served as the 42nd President of the United States from 1993 to 2001. Inaugurated at age 46, he was the third-youngest president. He took office at the end of the Cold War, and was the first president of the baby boomer generation...
derided him for having no exit strategy, although he had inherited an active military operation from his predecessor, President George H. W. Bush
George H. W. Bush
George Herbert Walker Bush is an American politician who served as the 41st President of the United States . He had previously served as the 43rd Vice President of the United States , a congressman, an ambassador, and Director of Central Intelligence.Bush was born in Milton, Massachusetts, to...
. The criticism was revived later against the U.S. involvement in the Yugoslav wars
Yugoslav wars
The Yugoslav Wars were a series of wars, fought throughout the former Yugoslavia between 1991 and 1995. The wars were complex: characterized by bitter ethnic conflicts among the peoples of the former Yugoslavia, mostly between Serbs on the one side and Croats and Bosniaks on the other; but also...
, including peacekeeping operations in Bosnia
Bosnia and Herzegovina
Bosnia and Herzegovina , sometimes called Bosnia-Herzegovina or simply Bosnia, is a country in Southern Europe, on the Balkan Peninsula. Bordered by Croatia to the north, west and south, Serbia to the east, and Montenegro to the southeast, Bosnia and Herzegovina is almost landlocked, except for the...
and Kosovo
Kosovo
Kosovo is a region in southeastern Europe. Part of the Ottoman Empire for more than five centuries, later the Autonomous Province of Kosovo and Metohija within Serbia...
and the Kosovo war
Kosovo War
The term Kosovo War or Kosovo conflict was two sequential, and at times parallel, armed conflicts in Kosovo province, then part of FR Yugoslav Republic of Serbia; from early 1998 to 1999, there was an armed conflict initiated by the ethnic Albanian "Kosovo Liberation Army" , who sought independence...
against Serbia.
The term has been adopted by critics of U.S. involvement in Afghanistan
Afghanistan
Afghanistan , officially the Islamic Republic of Afghanistan, is a landlocked country located in the centre of Asia, forming South Asia, Central Asia and the Middle East. With a population of about 29 million, it has an area of , making it the 42nd most populous and 41st largest nation in the world...
and especially Iraq
Iraq
Iraq ; officially the Republic of Iraq is a country in Western Asia spanning most of the northwestern end of the Zagros mountain range, the eastern part of the Syrian Desert and the northern part of the Arabian Desert....
. President George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
was said to have no exit strategy to remove troops from Iraq, and critics worried about the number of Coalition
Coalition of the willing
The term coalition of the willing is a post-1990 political phrase used to collectively describe participants in military or military-humanitarian interventions for which the United Nations Security Council cannot agree to mount a full UN peacekeeping operation...
soldiers and Iraq
Iraq
Iraq ; officially the Republic of Iraq is a country in Western Asia spanning most of the northwestern end of the Zagros mountain range, the eastern part of the Syrian Desert and the northern part of the Arabian Desert....
i civilian
Civilian
A civilian under international humanitarian law is a person who is not a member of his or her country's armed forces or other militia. Civilians are distinct from combatants. They are afforded a degree of legal protection from the effects of war and military occupation...
s who would suffer injury or death as a result. President Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...
also has not yet publicly announced an exit strategy for the troops in Afghanistan.
In business
In entrepreneurshipEntrepreneurship
Entrepreneurship is the act of being an entrepreneur, which can be defined as "one who undertakes innovations, finance and business acumen in an effort to transform innovations into economic goods". This may result in new organizations or may be part of revitalizing mature organizations in response...
and strategic management
Strategic management
Strategic management is a field that deals with the major intended and emergent initiatives taken by general managers on behalf of owners, involving utilization of resources, to enhance the performance of firms in their external environments...
an exit strategy, exit plan, or strategic withdrawal, is a way to transition one's ownership of a company or the operation of some part of the company. Entrepreneur
Entrepreneur
An entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative.The term was originally a loanword from French and was first defined by the Irish-French economist Richard Cantillon. Entrepreneur in English is a term applied to a person who is willing to...
s and investor
Investor
An investor is a party that makes an investment into one or more categories of assets --- equity, debt securities, real estate, currency, commodity, derivatives such as put and call options, etc...
s devise ways of recouping the capital they have invested in a company. The most common strategy is the sale of equity to someone else through a trade sale
Trade sale
A trade and or sale is a common way of exit to a trade buyer. This allows the management to withdraw from the business and may open up the prospect of collaboration on a larger projects....
.
Transition companies
Transition companies
Transition companies are professional mergers and acquisitions companies that assist middle market business owners in the transition from one person’s ownership to another...
are professional mergers and acquisitions
Mergers and acquisitions
Mergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or...
companies that assist Middle Market business owners with their exit strategy. Services offered are often referred to as Transition Management
Transition Management
Transition management is a service usually offered by sell side institutions to help buy side firms transition a portfolio of securities. Various events including acquisitions and management changes can cause the need for a portfolio to be transitioned. A typical example would be a mutual fund...
services.
From time to time, management may decide it is necessary to downsize its operations. This typically involves discontinuing less profitable brand
Brand
The American Marketing Association defines a brand as a "Name, term, design, symbol, or any other feature that identifies one seller's good or service as distinct from those of other sellers."...
s, products
Product (business)
In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce ' lead or bring forth'. Since 1575, the word "product" has referred to anything produced...
, product lines, or operating divisions.
Other types of exit strategy are:
Management buyout
Management buyout
A management buyout is a form of acquisition where a company's existing managers acquire a large part or all of the company.- Overview :Management buyouts are similar in all major legal aspects to any other acquisition of a company...
or employee buyout (common in the manufacturing industry)
See also
- SurrenderSurrender (military)Surrender is when soldiers, nations or other combatants stop fighting and eventually become prisoners of war, either as individuals or when ordered to by their officers. A white flag is a common symbol of surrender, as is the gesture of raising one's hands empty and open above one's head.When the...
- WithdrawalWithdrawal (military)A withdrawal is a type of military operation, generally meaning retreating forces back while maintaining contact with the enemy. A withdrawal may be undertaken as part of a general retreat, to consolidate forces, to occupy ground that is more easily defended, or to lead the enemy into an ambush...
- Iraq Study Group ReportIraq Study Group ReportThe Iraq Study Group Report: The Way Forward – A New Approach is the report of the Iraq Study Group, as mandated by the United States Congress. It is an assessment of the state of the war in Iraq as of December 6, 2006, when the ISG released the report to the public on the Internet and as a...
- Pyrrhic victoryPyrrhic victoryA Pyrrhic victory is a victory with such a devastating cost to the victor that it carries the implication that another such victory will ultimately cause defeat.-Origin:...
- No-win situationNo-win situationA no-win situation, also called a "lose-lose" situation, is one where a person has choices, but no choice leads to a net gain. For example, if an executioner offers the condemned the choice of dying by being hanged, shot, or poisoned, since all choices lead to death, the condemned is in a no-win...
- Total U.S. Withdrawal in the Vietnam War
External links
- 1993 White House press briefing - quoting Brent ScowcroftBrent ScowcroftBrent Scowcroft, KBE was the United States National Security Advisor under Presidents Gerald Ford and George H. W. Bush and a Lieutenant General in the United States Air Force. He also served as Military Assistant to President Richard Nixon and as Deputy Assistant to the President for National...
on exit strategy