Browse Definitions :
Definition

exit strategy

Contributor(s): Ivy Wigmore

An exit strategy is a planned approach to terminating a situation in a way that will maximize benefit and/or minimize damage.

The idea of having a strategic approach can be applied to exiting any type of situation but the term is most often used in a business context in reference to partnerships, investments or jobs.

Understanding the most graceful exit strategy for establishing partnerships should be part of due diligence and vetting potential suppliers and service providers. In cloud services, for example, termination or early-withdrawal fees, cancellation notification and data extraction are just a few of the factors to be considered.

An entrepreneur's plan for exiting a startup might include selling the company at a profit or running the business as long as the return on investment (ROI) is attractive and simply terminating it when that ceases to be the case. In the stock market, an exit strategy might include a stop-loss order that instigates a sale when the value of a stock drops below a specified price.

In an employment context, exit strategies are becoming increasingly important not just for corporate executives but for all employees. People change jobs much more frequently than they did in the past, whether voluntarily or involuntarily through firing, downsizing or outsourcing. An employee's exit strategy might include negotiating a severance agreement,, updating a resume, maintaining lists of potentially helpful contacts and saving enough money to cover a period of unemployment.

No matter what the context, creating an exit strategy should be an important part of any contingency plan and risk management strategy.

See also: supplier risk management

This was last updated in December 2014

Continue Reading About exit strategy

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • risk management

    Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings.

  • compliance as a service (CaaS)

    Compliance as a Service (CaaS) is a cloud service service level agreement (SLA) that specified how a managed service provider (...

  • data protection impact assessment (DPIA)

    A data protection impact assessment (DPIA) is a process designed to help organizations determine how data processing systems, ...

SearchSecurity

  • identity provider

    An identity provider is a system component that is able to provide an end user or internet-connected device with a single set of ...

  • firewall

    A firewall is software or firmware that enforces a set of rules about what data packets will be allowed to enter or leave a ...

  • encryption

    Encryption is the method by which information is converted into secret code that hides the information's true meaning. The ...

SearchHealthIT

SearchDisasterRecovery

  • business continuity plan (BCP)

    A business continuity plan (BCP) is a document that consists of the critical information an organization needs to continue ...

  • disaster recovery team

    A disaster recovery team is a group of individuals focused on planning, implementing, maintaining, auditing and testing an ...

  • cloud insurance

    Cloud insurance is any type of financial or data protection obtained by a cloud service provider. 

SearchStorage

Close