The reorganisation decision test: A risk analysis model to increase competitiveness
Cristina Stroie, Adriana Duțescu, Ionela Florea Munteanu, Kamer-Ainur Aivaz
Keywords:
Insolvency, Risk Profile Analysis Model, Reorganisation Plan, Reorganisation
Decision Test, Competitiveness
Abstract:
This article provides a fresh perspective on the essential question: company reorganisation or
bankruptcy? Competitiveness constantly reshapes business environments and strategic
planning objectives. Any important management tool for increasing competitiveness should be
based on effective risk analysis models that can integrate business reorganisation capabilities.
Relevant findings regarding the process of choosing an optimal reorganisation pattern are
discussed, and the conclusions are based on a study of a representative sample of insolvent
companies that conducted a reorganisation. This inductive research process presents valuable
insights and findings based on qualitative and quantitative analyses of the characteristics of
insolvency procedures, proposing an original risk profile analysis model called the
Reorganisation Decision Test (RDT). Cronbach’s alpha test, the principal component analysis
(PCA), and the receiver operating characteristic (ROC) curve analysis were used to analyse the
results and refine the company’s risk profile. The RTD was compared with the Altman Z-score
to assess whether this classical bankruptcy prediction model is relevant in business
reorganisation decisions, a topic that has not yet been thoroughly researched. The shortage of
studies, data, and statistics in this area represents a challenge as well as an opportunity.
Furthermore, an important information gap has been bridged using statistical indicators that can
contribute to public macro-economic disclosures in this field. This model can also add value to
professionals in the field of insolvency and provide valuable insights for various decisionmaking
users.
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 10.7441/joc.2023.02.05
Stroie, C., Duțescu, A., Munteanu, I.F., & Aivaz, K. (2023). The reorganisation decision test:
A risk analysis model to increase competitiveness. Journal of Competitiveness, 15(2), 78-95. https://doi.org/10.7441/joc.2023.02.05
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