Malaysia in the aftermath of economic crisis Malaysia Airlines had from a surplus to a deficit. The MAS has changed over to state enterprise and inaugurated a new CEO from the government. He started the business turnaround plan was changed MAS system. Since then the business turnaround plan and efforts record a surplus and they cancel small income root in order to make more profit. In addition, they were converted from ‘Point to Point’ to ‘Hub and spoke’. The hub and spoke model is almost all of the airline’s aircraft flies on spokes between destinations and the hub, with very few direct flights between other destinations. (“What is the Hub and Spoke Model?,” n.d., para. 1). The MAS Way provides the framework for our Business Turnaround Plan: 1. Flying to win customers- MAS will reconfigure our network and our product portfolio to ensure that they have the tools and capabilities to be a top-tier player in each of the markets we serve. 2. Mastering operational excellence- MAS will build a unique operating capability unmatched by our peers. 3. Financing and aligning the business on profit and loss- MAS will relentlessly increase profits with the support of a world-class finance function that ensures true financial accountability, transparency and performance orientation in our business. 4. Unleashing talents and capabilities- MAS is committed to their people. They strongly believe that the MAS employees and managers have both the passion and talent to achieve whatever goals we set for ourselves. 5. Winning coalitions- MAS know that they cannot achieve their goals alone. MAS need the resolute support of the Government, its employees, managers, customers, suppliers, agents and investors. (Malaysia airlines, 2006) While MAS has award-winning products and services, competitive cost base, and only slightly below average load factors, they yields are dramatically lower than their competitors. Therefore, they immediate problem is one of low cash and low yield and, in the medium term, they will face a cost challenge. Malaysia Airlines will transform itself over the next five years into a Five Star Value Carrier (FSVC) and they has focused on five steps that it terms the ‘Virtuous Cycle of Profitable Growth’. (Grant, Butler, Hung & Orr, 2011, p. 409). There are 5 bold steps which make up the FSVC Virtuous Cycle of Profitable Growth: 1. 5-Star: MAS must maintain the high quality products and services offered (5-Star) and these have to be constantly matched to the specific needs of our customers. 2. Lower Costs: MAS must reduce structural and operational costs. 3. Competitive Fares: With a lower cost base, MAS will be able to offer low and competitive fares to our customers, and still be able to make a profit 4. Get more customers, more revenue: With high quality products and services at low competitive fares, more passengers will choose to fly on MAS. 5. Grow network, build capacity: With more revenue and profit, MAS can invest in growing network and building capacity. MAS will open up more routes and acquire more planes, and this leads to sustainable, profitable growth. (Malaysia airlines, 2008)
MAS to maintain a 5-star airline need to provide quality service that is most important. The reason that customers with a comfortable flight and satisfy the requirements is important for high quality services. For example, if the flight attendants wear Malaysia traditional clothes, customers will be more able to inform MAS. It is brand strategy. Structure and operational costs in order to reduce the number of employees is recommended. For instance, most of domestic airlines are provide service a fee snacks and drinks while flying, many people did not get service in short distance. In short distance flight to customers who need provides service that seems to be the one of strategy. Airlines think that offer a simple snack respect for the customers. However, most adults who use domestic flights, they...
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