Case Study: Air Asia
TABLE OF CONTENTS
AIR ASIA’S STRATEGY
Internal environment Value Chain, Resources and Capabilities
External environment porters
Over all in brief Strength and weaknesses internal environment (what said above)
Over all brief Opportunities and threats external environment (Porters)
Air Asia is Asia’s largest airline that provides low cost airfares which is based in Malaysia. It was first established in the year 1993; however, it started its operations on the 18th of November, 1996. In 2001, the airline was purchased by Tony Fernandes’s company named Tune Air Sdn Bhd and was able to recreate the indebted airline to be one of the most well known airlines, famous for its cheap, efficient and low cost airlines for everyone. Hence, their slogan ‘Now everyone can fly.’ Air Asia has been gaining heaps of profits since 2002 and is able to launch new routes from it’s main hub in Malaysia; Kuala Lumpur International Airport in a lightning speed to many destinations at a possible promotional low price of US $1.
Although Air Asia is established as an airline that provides top class air services, Air Asia focuses a lot of their financial situations through stock control. The company Air Asia will continue to be an ongoing success as demographically there is a large increase in the number of travelers worldwide, this trend will continue to increase which result to an open opportunity that Air Asia can take advantage with their specials offers and flights accommodations makes their company peoples’ number one choice in air fares. Ever since Air Asia has been recognized, they have been acknowledged by satisfied customers and thus, have received many awards for being such an outstanding air flight company. There are many awards that they achieved consisting of; being a low cost airline for many years, achieving a place of top 3 in the best newly listed company and being a great help to business’s in delivering cargos. (Air Asia Website Awards). In the business of Air Travel, Air Asia experiences multifarious competition. The main and biggest competitors are companies like Air New Zealand Limited, Virgin Blue, Qantas Airways Limited, Jetstar and MAS. These competitors represent companies who take care of transport and focus on Air travels (IBISWorld 2011 page 24).
Therefore, the purpose of this case study is to critically analyze the strategies that are pursued by the company; Air Asia and how they implement this strategy to achieve the organizations’ strategic goals. Furthermore, on the basis of this analysis, there will be some recommendations on strategies to the company board for future action which will be justified by succinct reasons for these recommendations.
AIR ASIA’S STRATEGY
Firstly, Air Asia is an Asian based airline that has a mission aiming towards: * Creating a friendly and family environment for employees so that that they feel they are working for the best company * Being globally accepted as an ASEAN brand
* Making sure that they provide the lowest cost airfares to their consumers so that everyone can fly * And making sure that the highest quality of product is utilized as well as using technology to cut the cost and improving the service levels offered. Therefore, with all these goals that Air Asia aims to achieve, there must be a strategy that Air Asia has to exploit. Strategy can be defined as “an integrated and coordinated set of commitments and actions designed to exploit core competencies and gain a competitive advantage” (Hanson, Hitt, Ireland and Hoskossin, 2011). To decide which strategy this particular airline uses, an articulate examination of the characteristics of the industry must be conducted so that the competitive forces...
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