Management Consulting Case Study-Military Aircraft Industry

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Case Scenario-
A client who sells military aircraft is concerned that their stock is losing value. How might you assist them in raising their share price while looking into the reason for the decline?

Suggested Approach-
Understanding that the value of a share depends on predicted earnings in the future. This awareness will directly result in a framework for profitability (revenue/cost).

You should discuss both the income and expense sides as probable causes for declining earnings (and share price).
Reduced military funding has led to a decline in the military aircraft sector. A debate about expenses would take centre stage in this climate, limiting opportunities to increase income.

There are several ways to reduce costs, including eliminating facilities, automating more of the process, employing components that are more interchangeable among plane types, improving inventory management, and training workers to be more productive.

Here, it's important to think widely. Keep in mind that expenses depend on a variety of factors, including the workers' work habits, the available technology, and their competence

In this specific instance, the client was advised to try to combine with a lesser business in order to get some economies of scale. It was simple to see that not all of the market's five players would endure a market contraction when informed of this fact. Six months after the customer bought a smaller competitor, the share price began to increase.

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By Vandana Gaur


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