Strategic Analysis of Airasia

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Strategic Analysis of AirAsia

20442396

MGMT8700: Strategic Management

1

Strategic Analysis of AirAsia

20442396

MGMT8700: Strategic Management

2

Strategic Analysis of AirAsia

20442396

Contents
Executive Summary 1. Introduction
1.1 Purpose 1.2 Scope 1.3 Method 1.4 Background

4 5
5 5 5 5

2. Findings
2.1 Stakeholder Analysis 2.2 Strategic Transformation 2.3 Core Foundation 2.3.1 Mission 2.3.2 Values

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6 8 9
9 10

2.4 Strategic Intent
2.4.1 Vision 2.4.2 Strategic Objectives

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11 11

2.5 External Analysis 2.6 Internal Analysis 2.7 Competitive Advantage Analysis

12 15 19

3. Conclusion Reference List Appendix
Air Asia Financial Report 2009

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MGMT8700: Strategic Management

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Strategic Analysis of AirAsia

20442396

Executive Summary
This report outlines the strategic analysis of AirAsia Berhad, a leading low fare airline in Asia that adopts a no-frills, hassle-free, low fare business concept. AirAsia continually ensures the satisfaction of the needs of its various stakeholders, aggressively gains market share by undertaking various measures in line with its innovative and low cost strategy and seeks to add value by embracing technology, emphasizing on service and placing importance on employee satisfaction. The cost advantages created through high aircraft utilization, streamlining operations, maintaining a lean distribution system and applying a point-to-point network are then passed on to the customers. AirAsia’s mission and vision clearly articulate the company’s strategic intent and it is headquartered in Malaysia, which is a country that is stable and posting good economic growth. Malaysia, like the rest of the region, also has an increasingly affluent society that is technologically savvy and possesses a growing appetite for travel. The attractiveness and profitability of the low-fare airline industry has attracted many competitors, including traditional airlines launching low fare versions. AirAsia sustains its competitive advantage by leveraging on its competency in creating cost advantages across multiple value chains. Operational effectiveness and outstanding efficiency are its two main drivers of keeping costs low. It also creates value for its customers through its innovation and creativity, emphasis on safety, utilization of technology and the Internet, and in its continued efforts in ensuring employee satisfaction and increasing customer satisfaction by offering superior quality on its service. In summary, AirAsia has developed a considerable value chain in its approach, thereby adding value for the activities it has undertaken in its pursuit to provide low price air transportation services. Its strategic resources provide the basis for it sustaining a key competitive advantage and strategy execution. With these factors combined, AirAsia has displayed how synergies between management, employees and its environment can develop a competitive advantage that ensures phenomenal success and growth.

MGMT8700: Strategic Management

4

Strategic Analysis of AirAsia

20442396

1. Introduction
1.1 Purpose 1.1 Purpose
This report outlines the strategic analysis of AirAsia Berhad, a leading low fare airline in Asia. Through the analysis of the company’s stakeholders, key strategic issues, core foundation, strategic intent and internal, external and competitive environments, this paper identifies AirAsia’s core competences, competitive advantages and the environment in which it operates.

1.2 Scope
This report focuses mainly on the analysis of the internal, external and competitive environments of AirAsia.

1.3 Method
The information used in this report was derived predominantly from secondary sources including the Internet, academic journals and newspapers.

1.4 Background
AirAsia is the largest low fare airline in Asia. Established in Malaysia in 2001 and currently flying to over 40 destinations, the company adopts a...
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