ScenarioYou are a former Navy officer and fighter pilot who is now the controller of a division of TransGlobal Airlines, which utilizes a fleet of corporate jets for charter at several airports in the southeast part of the United States. Your divisions private charter clients include several Fortune 500 companies in the region. The Chief Financial Officer (CFO) has informed you that the company is considering the acquisition of two smaller aviation firms in the Caribbean specializing in chartered flights for luxury vacations using light aircraft (60 passengers or less). The CFO has tasked you with assessing the organizational benefits of acquiring these aviation firms. The CFO intends to develop a new business plan for the organization if your analysis recommends moving forward with the acquisition. After an initial assessment, the company has shortlisted two airlines they want to examine further for acquisition. To understand all aspects of the two airlines under consideration, you have visited each proposed site to assess their performance. The assessment includes creating and analyzing a balanced scorecard for each airline with all four componentsfinancial, internal processes, customers/market, and learning and growththat will impact the acquisition. In this milestone, you will use the given information to create balanced scorecards for Company A and Company B. PromptUse the to create a balanced scorecard for each company. Specifically, you must address the following rubric criteria: Use the data given in and to create a balanced scorecard for Company A. The balanced scorecard should highlight key performance indicators, such as net profit, annual growth, and market share, and include the four components:Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Internal Processes: Complete the internal processes section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Customers/Market: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Learning and Growth: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Use the data given in and to create a balanced scorecard for Company B. The balanced scorecard should highlight key performance indicators, such as net profit, annual growth, and market share, and include the four components:Financial: Complete the financial section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Internal Processes: Complete the internal processes section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Customers/Market: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs.Learning and Growth: Complete the customers/market section of the balanced scorecard template, identifying two of the most relevant key performance indicators.Explain your rationale for the KPIs chosen, with an explanation of the cause-and-effect relationship between the chosen KPIs. Share on Facebook Tweet Follow us Sample Answer Balanced Scorecards for Aviation Companies A and B Company A Balanced Scorecard Financial 1. Net Profit Margin – Rationale: This KPI measures the profitability of the company after all expenses have been deducted from revenues. It is crucial for assessing the financial health of the company and its ability to generate profits from its operations. – Cause-Effect Relationship: A higher net profit margin indicates effective cost management and operational efficiency, which can lead to increased investor confidence and potential for reinvestment in growth opportunities. 2. Annual Revenue Growth – Rationale: This KPI tracks the year-over-year growth in revenue, highlighting the company’s ability to expand its market presence and attract more clients. – Cause-Effect Relationship: Sustained annual revenue growth suggests effective marketing strategies and customer satisfaction, leading to increased market share and competitiveness in the luxury vacation charter segment. Internal Processes 1. On-Time Performance Rate – Rationale: This KPI measures the percentage of flights that depart and arrive on time, reflecting the efficiency of operational processes. – Cause-Effect Relationship: High on-time performance enhances customer satisfaction and loyalty, which can lead to repeat business and positive word-of-mouth referrals. 2. Aircraft Utilization Rate – Rationale: This KPI assesses how effectively the fleet is being used, indicating operational efficiency. – Cause-Effect Relationship: Improved aircraft utilization reduces costs per flight and maximizes revenue opportunities, thereby positively impacting profitability. Customers/Market 1. Customer Satisfaction Score – Rationale: This KPI gauges customer satisfaction through surveys and feedback mechanisms, essential for understanding client perceptions. – Cause-Effect Relationship: High customer satisfaction scores can lead to increased customer retention and referrals, directly impacting revenue growth. 2. Market Share Percentage – Rationale: This KPI measures the company’s share of the luxury charter flight market relative to competitors. – Cause-Effect Relationship: An increasing market share indicates successful differentiation strategies and can enhance brand reputation, leading to further growth opportunities. Learning and Growth 1. Employee Training Hours – Rationale: This KPI tracks the average number of training hours provided to employees, critical for maintaining high service standards. – Cause-Effect Relationship: Increased training hours can lead to improved employee performance, which enhances customer service quality and operational efficiency. 2. Employee Retention Rate – Rationale: This KPI measures the percentage of employees who remain with the company over a set period, indicating workforce stability. – Cause-Effect Relationship: Higher employee retention can lead to a more experienced workforce, positively influencing both customer satisfaction and operational performance. Company B Balanced Scorecard Financial 1. Return on Investment (ROI) – Rationale: ROI measures the profitability relative to the investments made in the company, providing insight into financial efficiency. – Cause-Effect Relationship: A higher ROI indicates effective use of capital, attracting potential investors and facilitating further expansions or acquisitions. 2. Gross Revenue – Rationale: This KPI tracks total revenue generated before any expenses, giving a broad overview of financial performance. – Cause-Effect Relationship: Increasing gross revenue demonstrates successful business operations and market demand, enabling reinvestment into service improvements. Internal Processes 1. Flight Completion Rate – Rationale: This KPI measures the percentage of flights completed compared to those scheduled, reflecting operational reliability. – Cause-Effect Relationship: A higher flight completion rate enhances customer trust and loyalty, leading to repeat bookings and positive brand perception. 2. Safety Incident Rate – Rationale: This KPI tracks incidents or accidents related to flight safety, crucial for maintaining operational integrity. – Cause-Effect Relationship: A low safety incident rate fosters customer confidence and mitigates legal risks, contributing to a strong market reputation. Customers/Market 1. Net Promoter Score (NPS) – Rationale: NPS measures customer willingness to recommend the company’s services, providing insight into customer loyalty. – Cause-Effect Relationship: High NPS indicates strong customer advocacy, which can drive new client acquisition through referrals and enhance market position. 2. Market Growth Rate – Rationale: This KPI evaluates the growth rate of the overall market for luxury charter flights, providing context for Company B’s performance. – Cause-Effect Relationship: Understanding market growth helps tailor business strategies to capitalize on increasing demand or adjust in response to market contractions. Learning and Growth 1. Innovation Rate – Rationale: This KPI measures the percentage of new services or improvements introduced over a specific period, indicating adaptability and creativity. – Cause-Effect Relationship: A higher innovation rate can lead to enhanced customer experiences and competitive advantages in a dynamic market. 2. Training Effectiveness Score – Rationale: This KPI evaluates the impact of training programs on employee performance through assessments or feedback. – Cause-Effect Relationship: Effective training correlates with improved employee competencies, leading to better service delivery and higher customer satisfaction levels. In conclusion, by utilizing these balanced scorecards for Company A and Company B, TransGlobal Airlines can effectively assess performance across crucial dimensions that will inform decision-making regarding potential acquisitions in the Caribbean charter market. This question has been answered. Get Answer
