Overview When Performing An Evaluation To Determine Performa

Overviewwhen Performing An Evaluation To Determine The Performance Or

Performing an evaluation to determine the performance or health of a company requires identifying and assessing current or potential risks it may face. This process involves conducting a comprehensive risk assessment to understand the business environment better. In this context, a report should be prepared detailing the identified risks, their implications, and strategies for mitigation, specifically for TransGlobal Airlines.

The report should include the following key components:

• Identification of Risks: Select two risks facing TransGlobal Airlines, ensuring at least one of them is high-impact. For each risk, specify which component of the balanced scorecard it corresponds to.
• Risk Classification: Classify each risk as either operational or strategic.
• Evaluation of Risks: Assess whether the probability and impact of each risk are low, medium, or high. Provide a justifiable explanation for these assessments.
• Mitigation Strategies: Propose strategies for risk prevention or mitigation tailored to each identified risk.

The report should be concise, spanning 1 to 2 pages, formatted with double spacing, 12-point Times New Roman font, and one-inch margins.

Paper For Above instruction

Risk assessment is a vital process in understanding and managing the potential threats that could impact a company's operational and strategic objectives. For TransGlobal Airlines, a comprehensive risk analysis involves identifying critical risks, understanding their implications within the business framework, evaluating their severity, and determining effective mitigation strategies.

Identification of Risks

The first step involves recognizing the primary risks facing TransGlobal Airlines. One significant operational risk is the potential for technological failures, such as system outages affecting booking or dispatch systems. Such failures can disrupt flight schedules, damage customer trust, and incur substantial financial losses. The second risk, that is high-impact and strategic in nature, is the threat of regulatory changes in international aviation policies. Sudden shifts in regulations can require costly adjustments in compliance measures, fleet management, and operational procedures, thereby threatening the company’s market position.

The operational risk of technological failures corresponds to the Internal Processes component of the balanced scorecard, which emphasizes operational efficiency and internal controls. Conversely, the strategic risk tied to potential regulatory changes aligns with the Learning and Growth component, as it influences long-term strategic planning and adaptation.

Classification of Risks

The technological failure risk relates to operational risk because it directly impacts the everyday functions and internal processes of the airline. On the other hand, the potential impact of regulatory changes is classified as strategic risk due to its influence on the company's broader strategic direction and market positioning.

Evaluation of Risks

In assessing the probability and impact of these risks, technological failures are considered to have a medium probability due to the ubiquitous nature of IT systems, but their impact is high if they occur, as they can halt operations and cause financial losses. Therefore, they are rated as medium probability and high impact. Regulatory change risk is less frequent but can have a high impact if new regulations are enacted unexpectedly, threatening the airline’s compliance costs and market access. The probability of regulatory changes is medium, given the historical volatility in aviation policies, with a high impact if such changes occur.

These evaluations are justified by industry data showing that IT failures are common but usually manageable with proper maintenance, while regulatory shifts are less predictable but potentially more disruptive, especially for international carriers like TransGlobal Airlines.

Mitigation Strategies

To mitigate technological failure risks, TransGlobal Airlines should implement robust IT infrastructure with regular system updates, backup protocols, and disaster recovery plans. Staff training on emergency procedures can also reduce operational downtime during technical issues. For regulatory risks, strategic foresight and engagement are crucial. The airline should maintain active dialogue with regulatory authorities and participate in industry lobbying efforts to anticipate policy changes. Additionally, developing flexible operational frameworks can allow rapid adaptation to new regulations, minimizing disruption and ensuring compliance.

Conclusion

Effective risk management for TransGlobal Airlines involves a proactive approach to identifying critical operational and strategic risks, evaluating their likelihood and impact, and establishing comprehensive mitigation strategies. Prioritizing technological resilience and regulatory agility can significantly enhance the company's ability to navigate uncertainties, safeguard assets, and sustain competitive advantage in the dynamic aviation industry.

References

• Anderson, K. (2018). Risk Management and Aviation Safety: A Practical Approach. Aviation Publishing.
• Baker, T., & Smith, R. (2020). Strategic risks in the airline industry. Journal of Business Strategy, 41(2), 45-53.
• Gillen, D., & Lall, S. (2018). Regulation and risk in international aviation. Transport Policy, 65, 123-132.
• Henderson, R., & Gordon, D. (2019). IT systems resilience in air transport. International Journal of Information Systems, 30(4), 467-480.
• Kim, H., & Kim, S. (2021). Navigating regulatory changes: Strategies for airlines. Transportation Research Part E: Logistics and Transportation Review, 146, 102173.
• Marcus, S., & Randon, P. (2017). The impact of operational risks in airline performance. Airline Management Journal, 27(3), 94-104.
• O'Connell, J. & Williams, G. (2019). Strategic Management in the Airline Industry. Public Transport International, 60(2), 24-27.
• Singh, A., & Patel, K. (2022). Mitigating cyber risks in aviation. Cybersecurity and Safety Journal, 8(1), 33-41.
• Thomas, M., & Lee, H. (2020). Risk assessment frameworks for airlines. Safety Science, 129, 104796.
• Williams, P. (2018). Regulatory challenges and strategic responses in aviation. Global Transport Infrastructure, 15(4), 56-64.