ABSTRACT

This chapter discusses the termination of organizations as distinctive and active entities; that is, when they neither provide products nor render services—they cease to function. The fundamental question in the study of pathology, whether in biological organisms or in organizational entities, is the meaning of death. The notion of organizational death is therefore rather complicated, since in reality the end of an organization may come in quite different forms, some of them still are controversial among scholars as they were twenty-five years ago. In the business sector organizations come to an end mainly due to a state of insolvency or of bankruptcy. Bankrupt organizations are likely to disappear from the business scene once their assets, tangible and intangible, are given away to the creditors. Organizational takeover is another well-known strategy of hiding a business firm under the cover of a different organization, most likely a rival, by means of acquisition or merger.