1. Poor management, typified by factors such as an overly autocratic chief executive, neglect of the organization’s core business and a weak board of directors
2. Inadequate financial control, particularly when the management accounting
3. Systems are poorly designed, management accounting information is not used by senior managers, and methods of overhead allocation distort costs
4. Competitive weaknesses due to products in decline and heavy emphasis on price competition
5. High cost structures, which may be the result of many factors, such as inability to take advantage of economies of scale or operating inefficiencies
6. Changes in market demand that the organization has not anticipated and cannot respond to
7. Adverse movements in commodity prices can be significant in certain industries
8. Lack of marketing effort can cause decline; when it is a major contributory factor it is usually related to weaknesses in the senior marketing staff, and associated with other fundamental problems such as price and product competition
9. Too many big projects involving major capital expenditure
10. Unwise acquisitions, such as buying organizations which themselves have a weak competitive position, or paying too much for them. However, the most common problem is poor management of the organisation once it has been acquired
11. Poor financial policies, particularly overtrading and/or inappropriate financial sources
12. Overtrading, so that sales grow at a faster rate than the organisation is able to finance from its cash flow and borrowings.