Features of Industrial Sickness

Features of Industrial Sickness:

(1)   Socio-economic problem: Industrial sickness is a serious socio-economic problem, which is result of unplanned industrial growth. It is a universal problem. In India, majority of sick units are small units. They are a serious problem in the economy.

(2)   Outcome of various causes: Industrial sickness is the net result of variety of financial, technical, managerial, personnel and marketing causes faced by industrial units.

(3) Universal problem: Industrial sickness exists among large-scale and small-scale units, public sector and cooperative sector enterprises. It is a universal problem.

(4) Visible symptoms: Industrial sickness is visible by various symptoms such as financial difficulties, low profitability, inability to pay interest and loan installments.

(5) Serious consequences: The consequences of industrial sickness on employees, consumers, investors, management and the national economy are serious. In addition, banks and term lending institutions come in difficulties due to industrial sickness.

(6) Preventive approach: Industrial sickness can be removed through preventive measures. Such approach is better than positive measures for the revival of a sick unit through turnaround package or corporate restructuring.

(7) Gradual process: Industrial sickness takes place in a gradual manner and not suddenly/overnight. Various stages are involved in this process. They include normal unit tending towards sickness, beginning of sickness and confirmed sickness with normal features. Preventive measures during incipient sickness are useful for avoiding sickness.