One of the risks that TransGlobal Airline is facing is competition. There is stiff competition in its market, and it is running some of its operations. Other airline organizations are offering the same services as TransGlobal Airlines. Therefore, the effects lead to other internal risks such as change adoption. Some efforts are being implemented to enhance the research and development department (Madsen and Stenheim, 2015). The end goal is to ensure new technology innovation, granting the company an upper hand in its market. Another risk being encountered is that of increasing demand. While the cost of some commodities such as gasoline is on the rise, there is an equivalent increase in the number of passengers in need of TransGlobal airline services. The situation presented is a risk due to the limited number of resources in the firm that can address the consumers’ demand while satisfying their utility level.
A balanced scorecard is a tool that is implemented in performance strategy management. It is structured so that the managers of an organization can keep track of some of the activities taking place in an organization, especially in situations where there is a need for project management. Learning and growth, business processes, customer perspective, and financial data are the four main components of a balanced scorecard. Competition is a risk that corresponds to the business processes component in the balanced scorecard (Madsen and Stenheim, 2015). More so, the risk is appertaining to an increase in demand related to the component of learning and growth. That is because as the demand for the products and services offered by TransGlobal airline is on the rise, there is growth that is taking place. However, there is a limitation in the availability of the resources that can be used to meet the rising demand both and the moment and in the long run.
The risks identified can be placed into two main categories. Operational is the first group of risks, and it is mainly related to those that interfere with the daily activities taking place in an organization. An increase in demand is the risk that falls under the category since the manufacturing, supply chain functionality, and production processes of TransGlobal Airlines are the ones that are negatively affected. The other category is risk is strategic, which correlates with those that affect the organization’s functionality. In general, it encompasses the risks that affect a company internally and externally, making it hard to achieve the set goals and objectives v. Competition is the strategic risk in the scenario since it makes it impossible for the company to gain market shares that will provide them with both an absolute and competitive advantage in their line of production.
Competition has the probability of having a high risk. Other organizations in the airline business have an active research and development department. More funds and resources are allocated towards ensuring their measures have been put in place to acquire the needed competitive advantage. More so, there are customization f products to meet the client’s demands and gain market shares. An increase in demand is a medium risk from forecasting (Riahi and Khoufi, 2016). That is because the organization can address the issue on an internal level. The transGlobal airline can implement manufacturing measures that can be used to increase their demand. Therefore, it will not be hard for them to address the issue of demand through an adjustment of their supply chain. The solution can be implemented at the moment of use as a contingency plan for future risk events.
References
Madsen, D. & Stenheim, T. (2015). The Balanced Scorecard: A review of five research area. American Journal of Management 15(2), 24-41.
Riahi, O., & Khoufi, W. (2016). Effects of Fair Market Value on Company’s Reputation. International Journal of Accounting and Economics Study, 4(1), 36.
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