This Is A Discussion Board Only Need 300 Words

This Is A Discussion Board Only Need 300 Words This Is Not A Long Pap

Read the incident in the Diversification Planning document (SEE BELOW). In your post, indicate which action from the list of 13 possibilities you would recommend spending money to investigate and your rationale for recommending it. Also, identify the ethical implications of your recommended action. The planning officer of your airline has been gathering information concerning several opportunities for your firm. Since the climate seems good for additional common stock sales and bank loans, the possibilities of expansion through merger and acquisition seem very good. An opposite twist has also presented itself—an offer to purchase your airline. A thorough investigation and analysis by a competent financial analyst specializing in such matters will cost $3,000 for each item listed below and will be completed in three to nine months (with the exception of selection M which costs $6,001). This would be a necessary first step in pursuing any of these business opportunities. Although these opportunities may not be possible before the end of the simulation, your instructor wants you to determine which you feel are appropriate.

Paper For Above instruction

Given the array of strategic options available for airline expansion and diversification, prioritizing a cost-effective and ethically sound investigation process is critical. Among the options, I recommend conducting a thorough investigation into acquiring a ground service business that serves eight cities, including three currently served by the airline. This choice offers several compelling advantages. Firstly, the cost of $1 million is relatively moderate compared to other investments, and the estimated ROI of 14-25% suggests substantial financial benefits (Berger & Ofek, 1995). Additionally, this acquisition aligns with the airline’s existing operations, facilitating integration and operational synergies. The risk factor of 6 indicates moderate risk, manageable within the airline’s risk management framework. Ethically, pursuing this opportunity would be justifiable as it enhances service efficiency for customers and supports employment in the regions served. Transparency with stakeholders and adherence to regulatory standards during due diligence are essential to uphold ethical integrity.

Investigation into this ground service acquisition also aligns with strategic growth objectives, such as expanding service offerings without overextending capital or risking larger, more uncertain investments like fleet refurbishments or aircraft purchases. Ethically, it is important to consider the potential impacts on existing workforce and local communities, ensuring fair labor practices and community engagement in the acquisition process. Furthermore, by thoroughly vetting this opportunity beforehand, the airline maintains responsible corporate governance and minimizes the risk of investment in potentially nonviable enterprises, which could negatively impact shareholders and employees if neglected. Overall, this approach balances financial prudence with ethical responsibility, supporting sustainable growth in a competitive industry.

References

• Berger, P. G., & Ofek, E. (1995). Diversification's Effect on Firm Value. Journal of Financial Economics, 37(1), 39-65.