Respond to the posts of at least two other learners, analyzing the potential risks and benefits of the action the learner recommended. Then, decide whether you would still select your recommendation or go with one of the other learner’s recommendation.
Post 1
There are two options which I feel would be in line with Zephyr Airlines’ stated cost-leadership/conservative approach, e.g., options G and H. Many of the other options carry an unacceptable risk factor, which goes against our philosophy. Option G, the Fixed Base of Operations, carries a risk factor of 5 but also the potential for a serious ROI (10-33%). This option would also allow us to repair some of aircraft at the hub, which agrees with our consistent commitment to maintenance, safety, and quality.
Option H, the training simulator, helps us train our pilots to be at the forefront of technology, and carries a risk factor of 4. While it is slightly lower risk than Option G, it also accordingly has a lower potential ROI of 15-20%.
In this case, while I feel Option H is the more conservative of the two, as a team member for Zephyr in this case I would push for Option G. It is still relatively conservative at risk factor 5, has a strong potential for solid ROI, and arguably increases our brand presence at the same time it significantly makes operations easier. Ethically I believe it would be a good decision because it will allow us to hire more people and would provide opportunities for advancement for some of our team members. Our decision to hire the relative with significant business contacts for a major position left some of our employees unhappy that someone was not promoted from within. This choice provides the ability to increase morale
Post 2
Diversification Planning
As the planning officer of Zephyr my airline company I will investigate the following in the order of importance.
• I would recommend that we lease three jets to operate exclusively for a large air-package service firm because
o Leasing the jets gives us flexibility to get out of the business if it turnouts not to be profitable as we expected.
o A four-year contract with automatic adjustment to fees to reflect current cost fuel which means that our profit margin is stable without effects of fluctuation from fuel costs.
o ROI is reasonable at 20% and risk factor is low.
Total cost of investigative analysis wound cost Zephyr $3,000. Ashe-Edmund recognizes that the business diversification is branching into new business opportunities, and not necessary selling out the entire company or adding an extension of the old services. Zephyr has maintained a successful cost strategy that has increased the company’s profitability and stockholder’s worth. Although it is tempting to tempting to present reasons not to sell the company I don’t believe the existence of Zephyr is in question by the board.
