thcorporating Stakeholder Impacts into Business Sustainability Analyses and Decisions Jack's Apps Company researches, develops, and sells traditional applications (i.e., apps) for middleaged mobile phone device users. In an attempt to tap into the large young adult app market to boos sales and advertising revenues, Jack's CFO, Daniel, is considering hiring students from area high schools and universities to drastically increase the innovativeness of the company's apps. Specifically, Daniel hopes that Jack's new student employee pool will make Jack's next wave of phone apps inventions popular with young adults by providing innovative services, such as exchanging payments for late-night food deliveries, arranging informal dating and other social gatherings, exchanging perspectives on different professors, and identifying unusual debit card purchase patterns to assist with early fraud detection notification. Based on cost estimates from Jack's finance team and surveys of its new target customers (i.e., New Customer Financial Survey), Daniel estimates that this new customer marhet would increase Jack's annual net income by $10,000,000. In addition to the New Customer Financial Survey, Jack's management team conducted a Business Sustainability Analysis, Specifically, the stakeholder engagement portion of the Business Sustainability Analysis revealed that four of Jack's most important stakeholder groups (advertisers, regulators, employees, and customers) would react strongly-some favorably and others unfavorably-to the decision to push its app business in the direction of the young adult market. Specifically, 10% of its existing advertisers would drop Jack's as a client, thereby reducing its annual advertising revenue of $10,000,000. Also, confidential discussions with competitors suggest that the new fraud detection app would require sensitive customer information that Jack's would be unable to protect perfectly from data hackers, thereby resulting in annual fines of $1,500,000 from regulators. In addition, employee 3. Conceptual Connection: Which of the following considerations that Jack's Apps Company management might be wise to consider before making a final decision on whether or not to pursue the young adult apps market. 1. The reliability of the nonfinancial measures included in the Business Sustainability Analysis (e.g., the degree of excitement for a more diverse workforce and whether this excitement would drive additional sales as indicated). 2. The reliability of the New Customer Financial Survey regarding additional sales of new apps in the target young adult market. 3. Whether these four stakeholders were the four most important ones or whether a different, unidentified stakeholder group might possess strong stakeholder expectations with financial implications for Jack's App Company that were not identified in the Business Sustainability Analysis. 4. Whether or not local high schools and universities actually have a large number of technologically trained young and/or female potential employees AND, if so, that they actually want to work for Jack's App Company as management included as an assumption in its analysis. existing advertisers would drop Jack's as a client, thereby reducing its annual advertising revenue of 10,000,000. Also, confidential discussions with competitors suggest that the new fraud detection apl would require sensitive customer information that Jack's would be unable to protect perfectly from data hackers, thereby resulting in annual fines of $1,500,000 from regulators. In addition, employee engagement meetings indicated that they would strongly favor the expansion into the young adult market. Daniel estimates that improved employee morale would significantly increase their productivity and creativity, thereby increasing annual sales revenue by $2,000,000. Finally, focus groups with existing customers revealed that they would highly value the increased workforce diversity of Jack's hiring a large number of talented young female employees with an expertise in technology. Daniel estimates that this positive customer sentiment would translate into an additional $3,000,000 in annual traditional apps sales. Required: 1. Using the New Customer Financial Survey and the Business Sustainability Analysis, calculate the net change in Jack's Apps Company's net income that would be expected from pursuing the young adult app market. 2. Jack's Apps Company the new young adult market for its future apps. 3. Conceptual Connection: Which of the following considerations that Jack's Apps Company management might be wise to consider before making a final decision on whether or not to pursue the young adult apps market