Highlights Excessive investment could be a mistake in corporate strategy. Implementation and evaluation of enactment a corporate strategy become critical subject matter. The integrity all parties within corporation defend sustainability corporations. Governance rules to avoid of malpractice's acts. The government promotes rules and models in implementation of good corporate governance (GCG).
Abstract This study aims to share the knowledge and practices behind the false corporate strategy implemented by the state-owned airline Garuda Indonesia due to multiple malpractices. Excessive investment should expand the scale and scope of the business but, otherwise, the strategy has accelerated management's chaos and disruption. The methodologies used in this study were mixed, combining case studies with descriptive and content analysis. The data taken was from 2009 to 2021, during this period, the state air flag carrier Indonesia has made excessive investments to procure 50 new aircraft from Boeing and an additional 10 units of Airbus by funding from the debts. This study found that Garuda went bankrupt because of excessive investment amplified by several mistakes in corporate strategy malpractices. The strategy to procure hundreds of aircraft is fine and precise, but some key persons took personal benefits from the transactions. In 2009, Garuda started extraordinary contracts, and by 2021 it was going into severe trouble. This study provides guidance and lesson learned for corporations that would have been considering doing business expansion due to wishing to increase the scale and scope of the corporation. This study enriches the literature on corporate strategies for future research.
Excessive investment failure corporate strategy: A case study of the bankruptcy of the state-owned Indonesia airline Garuda Indonesia
2022-05-05
6 pages
Aufsatz (Zeitschrift)
Elektronische Ressource
Englisch
Corporate strategy , Excessive investment , Airlines strategy , Governance , Procurement , Garuda Indonesia , BRI , Bank Rakyat Indonesia (State owned bank) , BNI , Bank Negara Indonesia (State owned bank) , LPEI , Lembaga Pembiayaan Ekspor Indonesia (State owned funding) , CTBC , PT Bank Chinatrust Indonesia , BCA , Bank Central Asia
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