8-2 Executive Summary: Safety Issues in Company B 1
Executive Summary: Safety Issues in Company B.
Myrnia Brown
SNHU/MBA 620
James Walter
April 21, 2024
8-2 Executive Summary: Safety Issues in Company B 2
8-2 Executive Summary: Safety Issues in Company B
Introduction:
While researching the current data and accuracy of Company B, I found that two of their
aircraft have been out of commission for the last few months due to mechanical issues and FAA
safety violations. The following research, repairs, and chastised flights have resulted in a 10%
drop in Company B’s revenue within the last month. Moderation expenses have added up close
to $80,000 to their operating costs and they have received negative customer feedback because
of some staff members’ mismanagement regarding this situation.
Analysis and Perspective:
Having two of the forty aircrafts out of commission because of mechanical issues and
safety violations is a major problem for Company B. It is important to take security and safety
precautions of the consumers seriously while being present in the aviation and travel industry.
TransGlobal Airlines made it transparent that they would like all of their employees to be trained
in the basics of FAA’s Safety Assurance System to ensure safe travel arrangements to their
customers. This shows just how laid-back Company B is regarding the safety of their clients,
according to Safety Assurance Systems. Organizations and its customers can be assured the
highest level of safety in National Airspace System by verifying that an aviation organization or
designee complies with and uses safety-related standards, regulations, and associated procedures
(FAA, 2020). These safety compliance issues have had a direct impact on Company B’s revenue
over the last month, resulting in a ten percent drop. This drop consists of expenses for research,
repairs, maintenance, and lack of flights available to their customers. In addition to this,
Company B’s operating costs increased by almost $80,0000 during the month.
8-2 Executive Summary: Safety Issues in Company B 3
For the initial performance evaluation, Company B did not show the best of promise to
start out with. Things such as decreased cabin noise, enhanced procedures for cleaning of the
aircraft, and the reservation system brought with it a $80k liability price tag that means more
risk. Transglobal will need to look at this and consider this amount of liability as well as
everything mentioned above regarding the mismanagement of these aircraft. Also, to take into
consideration is the ages of the aircraft themselves as the average lifespan of the aircraft should
be around 18 years of use. Company B has clearly shown the neglect it has for some of its fleet
and with a lot of them being up in age could cause Transglobal to make an even bigger
investment with Company B as they will have to refit them with new airplanes soon.
My suggestion would be not to proceed with the purchase of Company B. The initial buy-
in price plus the known probabilities of Company B significantly exceed the opportunity that
Company B is aiming to present. TransGlobal would take a great risk, with meager profit in the
end with the present probabilities of Company B and along with limited advantages that
Company B would yield TransGlobal. Thinking of these safety conclusions, I would like to
know if there is a reformation plan in place and what measures Company B is taking to enhance
the reliability and cleanness of their planes.
