Final answer:
The second step in a retrenchment strategy is recovery. This phase involves implementing strategic actions to reduce costs and stabilize the company, with the aim of returning to profitability and securing the company's future.
Step-by-step explanation:
The second step in a retrenchment strategy is recovery. A retrenchment strategy is a process a company uses when it needs to cut down or reorganize its operations, often due to financial hardship. After the initial phase of identifying the need for retrenchment and planning cuts, the recovery phase focuses on stabilizing the company's finances and returning to profitability. It may involve reducing expenditures, downsizing operations, or divesting non-core assets. This phase aims to create a more efficient and focused organization that is better able to compete in the marketplace.The recovery phase is crucial because it's where the actual implementation of the retrenchment occurs. During this phase, the company undertakes significant changes to its cost structure and business processes. Management seeks to strengthen the company's financial position while ensuring long-term viability. This may require hard decisions like layoffs, selling off parts of the business, or closing unprofitable divisions. The desired outcome is to emerge as a leaner and more dynamic company that can operate successfully with its newly streamlined assets and operations.Conclusion In summary, the main answer to the retrenchment strategy step following planning is recovery. This is a critical phase that focuses on operational and financial restructuring to bring the company back to a healthy state.