This study of corporate turnaround was conducted for three reasons. Firstly, from a long-run social welfare perspective, we began in the belief that efforts to rescue ailing firms are, in general, worthwhile as the economic and social benefits outweigh the costs. Secondly, the significant and increasing incidence of firms that find themselves in situations of sustained performance decline indicates the growing importance of the problem. Thirdly, the notable absence of a theoretical framework of corporate turnaround. The principal objective of this study was the generation of a theoretical framework of corporate turnaround. The methodology employed to meet this objective was the style of qualitative research known as the grounded theory approach and since our units of data were cases of turnaround, aspects of the case study method were incorporated. In operationalising the chosen methodology, two lesser auxiliary objectives were defined. Firstly, to assess the utility of on-line computerised databases as a primary source of data for this type of research; and secondly, to assess the utility of computer-based qualitative data analysis software packages in this type of research. Through the analysis of the three case studies (the 'literature' case study and the two 'empirical' cases) a rich theoretical framework of corporate turnaround was generated and tested. Appropriate recovery strategies were found to be contingent upon six sets of contextual factors: the causes of decline; the severity of the crisis; the attitude of stakeholders; industry characteristics; changes in the macroeconomic environment; and, the firm's historical strategy. The content of recovery strategies was usefully decomposed into operational level actions (management change; improved controls; restructuring finances; decentralisation; reduction in production costs; investment in plant and machinery; and, improved marketing) and strategic level actions (asset reduction/divestiture; product/market reorientation; vertical integration; and, joint-ventures). A temporal or implementation dimension was also discovered. Successful actions to effect recovery fell into four distinct (but overlapping) stages (the management change stage; the retrenchment stage; the stabilisation stage; and, the growth stage). Finally, 53 propositions linking the concepts and categories within the framework were generated. In chapter eight, the theoretical framework was assessed in the wider context of the literature on strategy formation. The framework was found to ultimately belong to the rationalistic school of thought but also was argued to provide a means of integrating that school with the supposed alternative incremental school of thought. This integration was suggested on the basis of context. With respect to the two lesser auxiliary objectives of this study, we found firstly, that the data available from the on-line databases Reuters Textline and Predicasts PROMT to be extremely appropriate for this type of research. The hundreds of articles extracted provided a rich and diverse source of information for the two 'empirical' cases. Our second auxiliary objective was to assess the utility of computer-based qualitative data analysis software packages when used in conjunction with on-line data in grounded theory research. In general, we found the packages to be of limited use (rather than easing the process they tend to overcomplicate it) with much development required before they can make a significant impact on the conduct and quality of qualitative research. However, we found the package that we used (ATLAS) to be very much the exception to the rule.