What distinguishes operational restructuring from financial restructuring?

The distinction between operational restructuring and financial restructuring lies primarily in their focus and objectives. Operational restructuring is mainly concerned with improving the efficiency and effectiveness of a company's operations. This can involve streamlining processes, enhancing productivity, reducing costs, and optimizing resource allocation to drive better performance and competitiveness in the market.

In contrast, financial restructuring typically revolves around modifying the capital structure of a company, which may include debt restructuring, altering equity ownership, or changing the financial obligations to improve liquidity and solvency. Thus, the clear emphasis of operational restructuring on refining and enhancing the operational aspects of a business—rather than on its financial arrangements—makes it the correct choice.

The other options mix components that do not align with the core focus of operational restructuring. For instance, market expansion relates more to business strategy than directly improving operations. Altering ownership structure is a characteristic of financial restructuring, as is increasing debt, which again falls under financial adjustments rather than operational improvements.