Business and Strategy Via Integration of Enterprise Risk Management: Air Transportation Case Study

Abstract

Business management requires both holistic and tailored strategy for every business since every corporation has its own unique characteristics and qualifications. Different qualifications create different risks, and different risks require customized approaches by managers. Air transport has always been seen as having an inherently strategic role. It has obvious direct military applications, but it is also highly visible and, for a period-and in some countries still-is viewed as a flag carrier, a symbol of international commercial presence. Air transportation is a key strategic asset in that it provides access to markets and thereby enables the economic development of nations and regions. However, the airline industry is exposed to risk which may affect operations, customers, corporate value, security, and safety. Risk can also be introduced to an enterprise through air transportation industry-based and organization-based changes, each of which may also bring changes in the type of risk. These present and emerging risks are the main reason for growing importance of enterprise risk management implementation in the airlines. The study begins with a definition of business, international business, and multinational enterprises. Following, international business history, its importance, characteristics, benefits, and problems are explained. In the second chapter, risk, risk management, and enterprise risk management are explained, followed by risks related to the airline industry in this study.