Week 5 Team Assignment

Virtual Organization Strategy Paper

FIN/370 Finance for Business

Alan Gorlick

Strengths

The first step of this analysis is to identify the strengths that the new company will have if they merge. Project the advantages that the company will have over its competitors in an internal as well as external environment (Businessball, 2012).

The performance of Southwest Airlines is one of the best within the industry because they have focused on customer’s satisfaction allowing them to be one of the top ranked airlines in the market, creating a good reputation for their name. This performance and reputation definitely will be strengths to this merger because those attributes could be implemented into the Carnival cruises as well, and carry over the good service, quality, and skills needed to succeed in this market.

Southwest Airlines had total revenue of over 14.8B in 2011 whereas Carnival Corporation had 15.5B in the same year. However, the difference between their net incomes is considerable; Southwest airlines had a net income of 178 Million in 2011 while Carnival Corporation had a much bigger number topping over 4.1B for that same year. From the point of view of Southwest airlines it seems that it would be advantageous to merge with a company profitable as it is.

This merge is likely to produce a greater Return on Investment. Because these two companies are currently in a good financial position, and possesses qualified personnel that have been trained for their duties, most likely the transition will be smooth, and it has the potential to become an exciting, stimulating, and rewarding company because of the changes.

The major strength of this merge is that the new company will have access to provide customers with the same exceptional service that Southwest Airlines has delivered previously with the combination of offering packages that include cruises and airfares for customers interested in exploring the world.

Opportunities

Once Southwest Airlines...