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MAS Blue Sky Strategy

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This case study is prepared to fulfill the requirement of completion of Business Strategy under UNIRAZAK MBA Program. It is fully use for an academic purpose. The team leader is Samuel Lai and it is …

This case study is prepared to fulfill the requirement of completion of Business Strategy under UNIRAZAK MBA Program. It is fully use for an academic purpose. The team leader is Samuel Lai and it is completed in 2010.

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  • 1. PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 2. Project Team KJ0810358 AYESHA AHMED KJ0810438 OSMAN BIN DAWATAN KJC0850091 CHIN PEK YUEN KJC0850092 HOR WAI MUN KJC0850122 SAMUEL LAI SIEW WENG KJC0850138 RITZERAYNN BIN RASHID KJC0850186 SHAZLINA BINTI HUSSIN PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 3. Agenda • Introduction of Malaysia Airlines • The market (IATA) • Business Turnaround Plan 1 • Business Transformation Plan 2 • External Matrix • Internal Matrix • External-Internal Matrix • SWOT • Alternative Strategy • Quantitative Strategy Planning Matrix • Blue Sky Strategy • Questions and Answers PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 4. Introduction • Malayan Airways started in 1937 when Straits Steamship Co., Singapore joined Ocean Steamship and Imperial Airways (British) • First operate airline from Kuala Lumpur to Singapore, Ipoh and Penang in 1937 • Awarded Cumber Batch Trophy for zero accident record in 1957 • Malayan Airways converted to Malaysian Airways in 1963 after established Malaysia (Peninsular Malaysia, Singapore, Sabah & Sarawak) • Malaysian Airways converted to Malaysia Airlines due to political differences between Kuala Lumpur and Singapore in 1972 • Malaysia Airlines expanded network to 47 overseas destinations between 1980s and 1990s • Malaysia Airlines suffered losses RM 260 million in 1997 (Asian Financial Crisis) • Malaysia Airlines enjoyed profit RM 461 million in FY2003/2004 • Malaysia Airlines reported losses RM 1.3 billion in 2005 resulted Dato’ Sri Idris Jala was appointed as CEO to bring back profitability PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 5. The Market (IATA) PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 6. The Market (IATA) PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 7. Dato’ Sri Idris Jala Initiative PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 8. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 9. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 10. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 11. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 12. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 13. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 14. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 15. Business Turnaround Plan 1 – Dato’ Sri Idris Jala Malaysia Airlines won many awards based on BTP 1 initiative • 5 Star Airline Awards 2007 - Skytrax • World’s Best Cabin Staff 2007 – Skytrax • Best Airline Cabin Service Worldwide 2007 - Smart Travel Asia • 2nd Best Economy Class Service 2007 - Skytrax • 3rd Best Economy Catering 2007 - Skytrax • 4th Best First Class 2007 - Skytrax • 4th Best Business Class 2007 - Skytrax PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 16. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 17. Business Turnaround Plan 1 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 18. Business Transformation Plan 2 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 19. Business Transformation Plan 2 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 20. Business Transformation Plan 2 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 21. Business Transformation Plan 2 – Dato’ Sri Idris Jala PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 22. External Matrix Key Factors Weight Rating Score External Opportunities Continuously demand growth 0.20 4.00 0.80 Academic & Training expansion 0.18 3.00 0.54 Aircraft maintenance & service expansion 0.09 3.00 0.27 Subtotal 0.47 10.00 1.61 External Threats Fluctuation of fuel cost 0.25 4.00 1.00 Foreign currency fluctuation 0.15 2.00 0.30 Strong competition from low cost carrier worldwide 0.13 3.00 0.39 Subtotal 0.53 9.00 1.69 Total 1.00 19.00 3.30 PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 23. Internal Matrix Key Factors Weight Rating Score Internal Strengths Innovative business strategy plan 0.20 4.00 0.80 Strong commitment by stakeholders to support BTP 0.08 4.00 0.32 Global serving customers over 100 destinations worldwide 0.05 3.00 0.15 Capability serve 40,000 passengers daily 0.08 3.00 0.24 International recognization of quality service (World Best Airline Crew 2008) 0.15 4.00 0.60 Subtotal 0.56 18.00 2.11 Internal Weakness High maintenance cost for old aircraft. 0.25 4.00 1.00 Low margin 0.10 1.00 0.10 Underutilization of fleet management 0.09 3.00 0.27 Subtotal 0.44 8.00 1.37 Total 1.00 26.00 3.48 PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 24. Internal-External Matrix (IE) PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 25. Strengths-Weakness-Opportunities-Threats Matrix (SWOT) Strengths Weakness 1. Innovative business strategy plan 1. High maintenance cost for old Strong commitment by stakeholders aircraft. to support BTP 2. Low margin 2. Global serving customers over 100 3. Underutilization of fleet destinations worldwide management 3. Capability serve 40,000 passengers daily 4. International recognization of quality service (World Best Airline Crew 2008) Opportunities Threats 1. Continuously demand growth (more 1. Fluctuation of fuel cost customers travel on air & many 2. Foreign currency fluctuation bankrupt airlines) 3. Strong competition from low cost 2. Academic & Training expansion carrier worldwide 3. Aircraft maintenance & service expansion PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 26. SWOT - Develop Alternative Strategies SO Strategies WO Strategies 1. Continuous Malaysian Hospitality 1. Maximization load factor by closely (S1, S2, S3, O1, O2) monitor seat ticket sales (W2, O1) 2. Revival Information System to 2. Systematically plan the flight facilitate sales and marketing (S1, schedule to ensure fuel cost S2, S3, S4, O1) efficiency (W1, W3, O1, O3) 3. Restructure marketing and communication (S1, S2, S3, S4, O1) 4. Upgrade knowledge centre into technical service provider (S1, S4, O2) ST Strategies WT Strategies 1. Increase load factor using carrot 1. Establish Risk Management and stick approach (e.g. offer Division to specialist hedge cost discounted seat to attract customer (W2, T1, T2) visit its website for sharing and communicating) (S1, S3, T3) PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 27. Quantitative Strategic Planning Matrix (QSPM) PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 28. BLUE SKY STRATEGY – A SUBSET OF BTP2 PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 29. BLUE SKY STRATEGY Overview The exploration of maximize utilization of current resources in the competitive marketing with creation of creativity innovation and a subset of BTP 2 that creates the competitive force to strengthening the current situation towards the same goals. Value of Blue Sky • Branding the value of the company • Locate the competition irrelevant • Unify the resource for efficient productivity • Evaluate the key index for continuity improvement PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 30. BLUE SKY STRATEGY – Branding Malaysian Hospitality PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 31. BLUE SKY STRATEGY – Branding Malaysian Hospitality Publicity Malaysian Hospitality - Offer brand sponsorship to international mass communication media Example, Triumph in the Skies is story telling about Solar Airways Branding eco-friendly - Installing winglets on Boeing 737s and 757s to save fuel and reduce emission (Continental Airlines) - Use biofuel for Airbus A380 to further save fuel - Use carpet from InterfaceFlor because 100% cycable and less maintenance and cleaning Corporate gift - Continuing communicate the brand between MAS and customers PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 32. BLUE SKY STRATEGY – Information System Collaboration PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 33. BLUE SKY STRATEGY – Information System Collaboration Kiosk - Set up kiosk machine at high traffic of customers to drive sales Example, CIMB – Oldtown White Coffee - Offer the convenient or purchase air ticket - Communicate to customers about events and promotion PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 34. BLUE SKY STRATEGY – Information System Collaboration Online partnership - Advertise at high traffic visitors to communicate about MAS Portal and Mobile Service - Target online website is google.com and facebook PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 35. BLUE SKY STRATEGY – Revitalization Marketing & Communication PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 36. BLUE SKY STRATEGY – Revitalization Marketing & Communication Business partnership communication - Working together with merchant bank to drive sales and brand communication. Example, HSBC Platinum for MAS 1st Class Ticket Educational value - Invite academic centres to share the strategy management - Openly encourage schools visit to promote MAS Hospitality Seasonal sale - Offer low fare and discounted fare to drive sales and load factor - Improve cashflow and reduce borrowing to finance the business Transactional analysis - Analyze customer demographic and traveling experiences to fulfill the expectations - Forecast sales growth, improve marketing mix, gauge income level PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 37. BLUE SKY STRATEGY – Transform Technical Knowledge Centre PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 38. BLUE SKY STRATEGY – Transform Technical Knowledge Centre Upgrade to technical college - Apply education license to venture new business - Providing quality worker - Qualification expansion from diploma to PhD - Act as Government’s premier aviation lab for R & D purposes - Become self-financing centre Education diversification - IATA Quality and Safety Standard should be offered to GLC - Collaboration with specialize academic centre for innovative qualification. Example, Bachelor of Hospitality and Tourism Communication language centre - Offer affordable language courses (Malay & English) It is similar of The British Council function and business PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 39. BLUE SKY STRATEGY – Loyalty Program Expansion PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 40. BLUE SKY STRATEGY – Loyalty Program Expansion Recruitment drive - To get new customer - Grads Loyalty Program – University orientation day - Enrich Loyalty Program – television commercial on aircraft - Loyalty Service Centre at airport Publicity and awareness - Animation commercial at Internet media (The Star, Tourism Office, facebook, youtube, etc) Customer traveling analysis - Continuing communicate with loyalty customers about marketing mix Prioritize promotion and offer - Card holder will be prioritized for pre-booking PDF Creator - PDF4Free v2.0 http://www.pdf4free.com
  • 41. THANK YOU PDF Creator - PDF4Free v2.0 http://www.pdf4free.com

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