In developing Malaysia economy the airline industry has played a vital role. In the past decades, the Malaysian aviation sector has experienced a period of strong growth, with the high growth rates of passenger traffic at both domestic and international terminals. However, in the year 2014 Southeast Asia’s aviation industry has faced a record number of tragedies. Three planes out of which two based in Malaysia, the third was Indonesian affiliate of a Malaysia-based group have actually disappeared with no survivors. These three air tragedies point to several alarming trends that has raised the question of whether flying in Southeast Asia peninsular is totally safe.

This paper analyses the current situation of both AirAisa and Malaysia Airlines. The first part of the paper provides case background including both companies’ vision, mission and services provided. Following that the case problems are identified. After that both companies’ SWOT analysis are given. This is followed by the current strategies that the companies are using to counter the problems faced. Afterwards an evaluation of these strategies is given. Finally, more recommendations and conclusion of the paper are provided.

2.0 Case Background

2.1 AirAisa

Asia's top airline was developed with the vision of creating flying possible for everyone. Since 2001, AirAsia has rapidly broken travel customs around the world and has increased to become the world's greatest. It has a route network that spreads through to over 20 nations. They have set to take low-cost flying to an all new high with their belief, "Now Everyone Can Fly" with their associate companies, AirAsia X, Thai AirAsia, Indonesia AirAsia, Philippines' AirAsia Inc and AirAsia Japan. AirAsia.

Vision: “To be the largest low cost airline in Asia and serving 3 billion people who are currently underserved with poor connectivity and high fares.”

Mission: “To be the best company to work for whereby employees are treated as part of a big family. Create a globally recognized ASEAN brand. To attain the lowest cost so that everyone can fly with AirAsia. Maintain the highest quality product, embracing technology to reduce cost and enhance service levels” (AirAsia, 2015).

2.2 Malaysia Airlines

Malaysian Airline System is a public limited company founded in Malaysia. In addition to airline services, the company is also providing cargo and maintenance services. It operates in 6 areas and covers over 100 different locations. The company’s headquarter is in Kuala Lumpur, Malaysia.

Vision: To be the preferred global MRO organization.

Mission: To deliver excellent aerospace engineering services, provide value to our customers, maximize returns to stakeholders and be the employer of choice (Malaysia Airlines, 2015).

In the past year, Southeast Asia’s aviation industry has suffered an unprecedented number of tragedies. For Malaysian aviation, 2014 has been an unimaginably horrible year. Three planes out of which two based in Malaysia, the third was Indonesian affiliate of a Malaysia-based group have apparently gone down with no survivors. These three air disasters point to several disturbing trends that raise the question of whether flying in peninsular Southeast Asia is completely safe.

MH370: The disappearance of Malaysia Airlines Boeing 777 on March 8. Flight 370 with 239 people aboard from Kuala Lumpur to Beijing vanished without trace.

MH17: All 298 passengers and crew aboard Malaysia Airlines Flight 17 were killed when the Boeing 777 was shot down over rebel-held eastern Ukraine on July 17. The plane was flying from Amsterdam to Kuala Lumpur.

QZ8501: An Indonesia AirAsia flight with 162 people aboard, most of them Indonesians, disappeared on 28 December 2014, crashed into the Java Sea off Borneo. The contact with Flight 8501 was lost about 42 minutes after the single-aisle, twin-engine A320-200 jetliner took off from Surabaya airport in Indonesia for Singapore (“Missing AirAsia flight”, 2014, Dec 28).

3.0 Identification case problem

3.1 AirAsia Flight QZ8501

Possible causes

The airplane was climbing at “beyond normal” speed before it pitched into the Java Sea. Investigators have ruled out terrorism after reviewing the black boxes and are considering human error, technical malfunction and inclement weather as possible causes for the steep climb and the crash (Rachel, 2015). According to Indonesian Reports, AirAsia Flight 8501 crash possibly caused by icing (Otto, & Pasztor, 2015). According to Indonesian investigators, the co-pilot of AirAsia Flight QZ8501 was controlling the plane before it crashed (Berenson, 2015). Before the communication with the aircraft was lost pilots asked to change course to avoid bad weather (AirGuide, 2014). The pilot asked permission to climb but was refused due to traffic in the area, giving him no choice but to fly through storms. There was a failure of the air traffic control system (Noakes, 2015). There was confusion about how, or even if, AirAsia had a permit to fly the route on that particular day (Baker, 2015). Indonesia's acting director general of transportation, told the AP there was no distress signal. AirAsia noted that the pilot and co-pilot had a combined 8,000+ flying miles as experience and that the plane had just undergone maintenance last month (AirGuide, 2014).

Consequences

Analysts believe the incident could deter some passengers from using the airline, at least in the short term, with an outsized impact on its bottom line. There will definitely be a short-term impact on demand. Decline in AirAsia's 2015 passenger traffic will result in reduction of 2015 net profit. Investors concerned about the incident's impact sold shares of the company. AirAsia's 13-year-old reputation will offset the negative perception arising out of this incident. AirAsia will have an even bigger impact because it's a low-fare carrier. There can always be a perception that low-costs may mean a carrier is cutting corners on safety (AirGuide, 2014).

3.2 Malaysia Airlines Flight MH370

Possible causes

Marc Dugain says Flight MH370 was shot down by the United States Air Force after the military feared the plane had been compromised. Nigel Cawthorne suggested in his book "Flight MH370: The Mystery,” that MH370 was mistakenly shot down in a joint military training operation between the U. S. and Thailand military forces. Tim Clark said he believed MH370 was under the control of someone until the end (AirGuide, 2014). Malaysian government had said it believed the plane had been deliberately diverted by someone on board (Beech, et al. 2014). It was not only a technical mystery but demonstrates several weaknesses of the current technical, regulatory and organizational infrastructure of international civil aviation. Safety critical communication connectivity was not global and as seamless as generally perceived, neither are air traffic services (Stefan, 2014).

All indications show skies were clear. Loss of both engines is possible, but plane could glide for up to 20 minutes, giving pilots plenty of time to make emergency call. Traditional hijacking seems unlikely given that plane captors typically land at an airport and make some type of demand. Two suspects on passenger list were using stolen passports - one Italian and one Austrian. Both passports were stolen in Thailand. Two large jet crashes in late 1990s - a SilkAir flight and an EgyptAir flight - believed to have been caused by pilots deliberately crashing planes (Sinclair, 2014).

3.3 Malaysia Airlines Flight MH17

It was alleged that pro-Russian separatists shot down the aircraft using a surface-to-air missile as it was flying over a potential war zone in eastern Ukraine. The Federal Aviation Administration (FAA), United States’ national aviation authority, issued a Special Federal Aviation Regulation and Warning on the 23rd of April 2014 cautioning airlines against taking a direct flight path over certain areas in Ukraine as a result of it being a potential war zone. Despite warnings issued from the FAA a number of airlines chose to ignore such warnings and accepted the risk of flying over Ukrainian Airspace; resulting in the loss of MH17. There was speculation that the Flight MH17 had taken a shortcut across the disputed region of eastern Ukraine to save fuel. There is possibility that Malaysian Airlines were applying a minimum level of safety regulations whilst they were attempting to resolve their financial situation (Dr. Hodgson, 2015).

3.4 Hackers Hit its Website

In January 2015, Malaysia Airlines said that its website had been “compromised”. Users going on the airline’s website were directed to a page touting messages from a group claiming to be aligned with Islamist extremism. The browser window, reading “ISIS WILL PREVAIL,” stood over a page displaying the image of an aircraft along with the message “404- Plane Not Found.” Malaysia Airlines assures customers and clients that its website was not hacked and this temporary glitch does not affect their bookings and that user data remains secured (Stampler, 2015).

Consequences

Following the shooting down of MH17, search costs requiring millions of dollars added a huge financial burden on the airline. During the second quarter, Malaysia Airlines’ flights were an average 73.7% full, compared with 80% a year earlier (Noakes, 2014). Many people have expressed greater concern regarding their security and safety being compromised whilst flying. Damaging its brand and its business reputation, and accelerating the urgency for radical change (Schuman, 2014). The airline is losing between $1 million and $2 million a day through lost ticket sales and likely could survive only six more months if that continues (Veysey, 2014). The brand's long-term future now appears in doubt. Many of the passengers had fear and doubt as to whether the airline would be safe to fly with in the future. Passenger bookings declined and those who had booked earlier tried to cancel and refund their tickets. Average weekly bookings had declined 33 percent with numerous flight cancellations immediately after the shooting down of flight MH17 (Dr. Hodgson, 2015).

4.1 AirAsia SWOT Analysis

(Kiasutrader, 2015).

4.2 Malaysia Airlines SWOT Analysis

(Anika et al. 2014).

5.0 Current Strategies

5.1 AirAsia

1. Search and rescue operation: A massive search and rescue operation was started for AirAsia flight QZ8501. At this time, search and rescue operations were in progress and AirAsia was cooperating fully and assisting the rescue service (AirGuide, 2014).

2. Response right from the top: The airline's founder Tony Fernandes has joined the search efforts. From the start, Fernandes publicly took responsibility, visited victims' families. Fernandes directly tweeted about the incident, its updates and what he and his team were doing (Forbes, 2014).

3. Updated Information: AirAsia immediately announced that all official updates would be communicated on its Facebook page. AirAsia has established an Emergency Call Centre that is available for family or friends of those who may have been on board the aircraft. The number is: +622129850801. AirAsia releases further information as soon as it becomes available. Updated information also be posted on the AirAsia website, www.airasia.com (AirGuide, 2014).

4. The brand changed colour to reflect the seriousness of the matter: Within minutes of the first update on the incident being posted, AirAsia changed the colour of its logo on its Twitter page from its festive red to a sombre grey. And a little while later changed its Twitter background image to just a plain black image.

(Lalla, 2014).

5. Changed its focus: AirAsia did not just change the look of its web presence, it changed its very focus. Within hours of the incident, not only did it have a prominent message with updates on its website home page, but it removed all promotional messages from its home page. Being the holiday season, as one would expect there were a bunch of such messages up in the morning. However no paid Search ads from AirAsia on Google around flights in the region. Clearly the campaigns were paused soon after the incident (Lalla, 2014).

6. Focus on passengers and their families: Tony Fernandes said that he will be there through these hard times. We will go through this terrible ordeal together. He adds: “Keeping positive and staying strong. My heart bleeds for all the relatives of my crew and our passengers. Nothing is more important to us" (Lalla, 2014).

7. Constant Pricing strategy: While some passengers may avoid taking (AirAsia) flights in the short-term, AirAsia's low-cost proposition will be continued (“AirAsia tipped to”, 2015).

5.2 Malaysia Airlines

Crisis Management: Malaysia Airlines issued a statement within hours of losing contact with Flight MH370 demonstrating responsibility and taking the lead as an official source of information. The message was straightforward and truthful. The airline also published emergency contact information through alongside media statements including press contacts (Petrolino, 2014).

Meantime, Khazanah Nasional Berhad (“Khazanah”) announced a 12-point enabling plan for returning Malaysian Airline System Berhad (“MAS”) to sustained profitability and revive Malaysia’s national flag-carrier.

1. Creation of NewCo to house New MAS, delist and relist: Delist MAS (“OldCo”) by end of 2014. NewCo will critically involve a significantly corrected cost and operational structure and workforce, properly benchmarked to competitive industry practices and norms. NewCo is targeted to return to profitability within 3 years of delisting, and to relist within 3 to 5 years, that is between the end of 2017 and the end of 2019.

2. Funding of up to RM6.0 billion on a strict conditional basis and a reduction of net gearing to approximately 120%: The total funding package is estimated at RM6 billion ($1.9 billion). The share buyback will account for RM1.4 billion; "restructuring and retrenchment" will cost RM1.6 billion; and then another RM3 billion in capital will be injected into the new company over a three-year period through 2016. The carrier will also reduce its net gearing - the net debt over shareholders' funds - from its current range of 290% to between 100% and 125% through debt-to-equity swaps. The plan is to relist the firm within three to five years to allow Khazanah partially to sell down the firm and recoup its investment.

3. Reset the operating business model through a more regionally-focused network, lower cost structure and greater emphasis on revenue yield management. The carrier's new business model is to be based on a rationalized network that will be more "regionally focused," relying on one world alliance airlines and other code-share partners for global connections. The network will rely more on routes that have a high proportion of origin and destination traffic, particularly in the ASEAN (Association of Southeast Asian Nations) region, rather than transit traffic.

4. Consolidate headquarters and operations from Subang to KLIA: One of the conditions of the MAS Recovery Plan is for MAS to move its HQ and principal operations from Subang to KLIA.

5. Strengthening of the assurance, integrity and safety functions: Another condition of the MAS Recovery Plan will be the strengthening of key control and operational systems.

6. Review and, where appropriate, renegotiate supply contracts: It is intended that New MAS will honour all properly benchmarked contracts under OldCo.

7. Leadership: The transition period between OldCo and NewCo over the months to 1 July 2015 will see significant changes to leadership, which will be executed in an orderly fashion. Ahmad Jauhari Yahya will continue to lead OldCo as the Group CEO during this period until 1 July 2015, when NewCo is envisaged to come into force.

8. Right-sizing the workforce to an estimated 14,000 employees at NewCo: This is a net reduction of 6,000 or 30% from the approximately 20,000 current staff in OldCo. It is estimated that NewCo will require a workforce of approximately 14,000.

9. Strengthen industrial relations and internal alignment: New measures and practices, includes introducing an Employee Consultative Panel to better align staff, employees‟ unions and management.

10. Reskilling, job creation and redeployment: Khazanah will invest in a Corporate Reskilling Centre, to be located in the Subang area, specifically to address the reskilling of the appropriate MAS staff who do not migrate to NewCo.

11. Appropriate Government support on key initiatives including: Subject to Parliamentary and other approvals (as may be applicable), the enactment of appropriate enabling legislation, including a standalone Act specific to MAS, with a finite period, to facilitate the restructuring in a comprehensive and timely manner.

12. Continuous communications and stakeholder engagement (Rebuilding a National Icon: The MAS Recovery Plan, 2014).

In addition to this strengthening of the assurance, integrity and safety functions, reskilling and job creation, continuous communications and stakeholder engagement are good strategies that will help them to overcome the issues and to implement the restructuring plan. The change of leadership will also help them to move the right direction but the leader should be a person who has the capabilities to overcome the current situation.

6.0 Evaluation of strategies

6.1 AirAisa

1. Search and rescue operation: This operation was successful with the help of many counties and has found corpses and flight parts in Java Sea (Lalla, 2014).

2. Response right from the top: CEO responded quickly which was a perfect decision because it usually disseminated through the corporate communications team and PR agencies. This real, personal approach was refreshing. This openness and direct communication from the top was widely appreciated by the public. As a result, the possible negative effect on its brand can be minimized and will help to retain its customers (Lalla, 2014).

3. Updated information: There has been accurate and frequent communication and an authentic, heart-felt compassion. This effective communication avoided any potential confusion from third party sites and opened up a two-way form of communication, rather than the company releasing official (but static) statements. Determine who the critical decision makers are and who will serve as the spokesperson and inform all players of their roles (Lalla, 2014).

4. The brand changed colour to reflect the seriousness of the matter: This reflected in how the brand presented itself, and this change too was noticed and complimented by folks in social media. It reflects an attention to detail and management concern that sets AirAsia apart in terms of crisis communications (Lalla, 2014).

5. Changed its focus: Its main focus was to handle the situation. This helped them to overcome the crisis more easily without affecting its brand image (Lalla, 2014).

6. Focus on passengers and their families: CEO personally reassured his staff that he would be with them and try and personally connect with as many as possible as they together went through this most difficult time of their lives. This will help them to retain its customers and to develop the trust on the brand (Lalla, 2014).

7. Constant Pricing strategy: Keeping the same low prices will help them to retain its customers and to protect its reputation in future (Lalla, 2014).

According to Daniel Tsang, an aerospace analyst with Aspire Aviation, this was an excellent case of a crisis being handled well. They have shown its customers that things are being taken care of in a hands-on manner. It was a smart strategy, according to Hamish McLean, a professor who specializes in risk and crisis communication at Griffith University in Australia. McLean told Bloomberg Television that Fernandes understands the social media can save reputations in a crisis. According to McLean if handled differently, the headlines about AirAsia could have been radically more negative (“AirAsia tipped to”, 2015). Therefore, it has proven that the company has produced a great case study of how to handle a delicate crisis situation. AirAsia serves as a reminder to others that emergencies can occur at any point in time.

6.2 Malaysia Airlines

But even with so many arguments in favour of the rebranding of the airline, there is still an apparent reticence to do so on the part of the Malaysian government. As in so many rebranding cases, the initial attraction of starting again from a blank page which can appear so attractive at first sight and begins to fade with more careful reflection (Ritson, 2014). Hence this might not be a good strategy for MAS.

Malaysian Airlines' brand image is currently tarnished but brand equity has two component parts. The first is simple brand awareness, the second the more complex brand associations that form brand image. While clearly there is an enormous challenge ahead to restore the image of the carrier, it is crucial not to forget about the hundreds of millions of pounds it would take to build up a similar level of brand awareness for new airline (Ritson, 2014). Therefore this strategy might not help them to overcome the current situation.

Will the new restructuring be enough? Analysts were quietly optimistic when contacted by Airfinance Journal, citing the big reduction in workforce, which is a politically difficult move. They also added the latest restructuring will be the deepest yet, and the formation of Newco would allow it to renegotiate existing contracts (Ritson, 2014). Hence this might not be enough for to overcome the current situation.

According to Ritson (2014) there is no doubt that MAS appears bloated in terms of staff compared with its rivals. According to The Airline Analyst, AirAsia has 143 aircraft and about 5,867 employees. In comparison, MAS has about 20,000 employees and 147 aircraft. If the airline can implement the job cuts, it should help MAS reduce its negative cash flow, but it will be interesting to see how MAS will "reset" its existing model.

According to Ritson (2014) there is a clear hint through the restructuring announcement is that it will lose some of its long-haul capacity, which suggests the airline will start shedding some of its wide bodies, the aircraft that typically service those routes. According to the AeroTransport database, the airline has 17 A330-300s and six A380s. Only six of its A330s are leased - the airline owns the rest of the aircraft. If MAS is keen to get cash quickly, then we might see a further six A380s hit the market.

According to Ritson (2014), consolidate headquarters and operations from Subang to KLIA will allow MAS to consolidate its operations, improve working conditions and signify a new beginning under New MAS.

According to Ritson (2014) the migration to NewCo will nonetheless provide an opportunity for New MAS to reset and renegotiate supply and other contracts, based on market norms and benchmarks. Rebranding would be an easy but it will be unfortunate if wrong steps are taken in the wrong direction.

Crisis Management: According to Petrolino (2014) Malaysia Airlines was not thinking of the families – they probably were not even thinking about how this would appear. They were in survival mode. They did not act swiftly enough, nor did they stay on top of the issue, providing updates, or even just communicating there were not any updates to be made. They were not adequately prepared. The different parties seemed to work completely independently of each other. There was no collaboration between all sectors of an organization.

7.0 Recommendations and Reasons

7. 1 Recommendation for AirAsia

They need to build up its brand advantage continuously. As the low cost carrier and with its long history, AirAisa needs to lead its position in the airline industry in future in terms of safety operation and services. In the past years they have gained a high brand value (Air China, 2015). I believe this is a good strategy because they can keep on strengthening its brand and make constant efforts to be innovative in their service to satisfy their customer needs by using its brand advantage. In order to do this they need to work hard to make the brand of AirAisa attractive to customers and maintain the customer loyalty. This will be an easy strategy them to implement which will bring good results.

7.2 Recommendation for both companies

1. Working on Training

They should develop training for all personnel involved in all facets of mitigation: airport operations, flight crews, ground crews, government workers, etc. Additionally they should recommend training programs for such entities as flight schools, airline operators and other organizations responsible for airport and aviation operations. They need to offer valuable incentives for pilots to undergo quality recurrent and safety training, while also eliminating loopholes or incentives that compromise safety (Eschenfelder, 2009).

They need to address employees because employees are often forgotten in any crisis response and are an afterthought in a public relations campaign. The airlines need to make sure that all employees know what is being done to address consumer concerns about safety and service issues, as well as, what is expected from them (Johnson, 2014). Therefore they need to address their employees before, during and after the crisis in order to handle this type of difficult situations.

2. Improve Safety and Regulations standards

Safety is extremely important for both companies. Safety guidelines must be based on scientific management, proactive prevention and effective control. They need to have a solid foundation of safety work in building of crews, engineers and flight operation teams with the proper rules and regulations. They should develop the policy and regulation equivalent to that in place with other aviation hazards. Regulations and policy could address the need for training plans by air operators; speed limits such as 250 knots below 10,000; flight profiles which reduce risk in high bird concentration area, etc. Policy should be comprehensive and examine all facets of the hazard (Eschenfelder, 2009).

In order to do this they need to be proactive by discussing what additional and new safety precautions the industry and individual airlines are doing in the aftermath of these highly publicized disasters. Too often, an industry waits for regulators and politicians to address a crisis before providing their solutions. (Johnson, 2014). Such policy would serve as the ‘standard’ for aviation operations in the presence of wildlife hazards. Hence they need to institute a system of checks and balances to ensure that pilots have a sufficient safety net from human error. These airlines need a step ahead and discuss how they are going beyond what is legally required with more comprehensive safety measures. This strategy will help to change customer perceptions.

3. Change perceptions:

Customer orientation is the core of these businesses concept. All business activities should rely on the target customers they serve. They should care for their customers by monitoring the market and understand that by winning customers. Their entire business operations and activities should be aimed at providing superior service for customers. They must foster the business concept of customer orientation and make it first priority in order to satisfy the unhappy customers and increasing customer demands. They should propose a service philosophy of Trust, Convenience, Comfort and Satisfaction, which can gain prominent results in practice. They need to achieve universal acceptance by the public, they are required to build a value proposition that is market oriented and fostered by a philosophy that focuses on customer demand (Air China, 2015).

These airlines need to have a publicity campaign with a series of television commercials stressing the safety of airline travel compared to other modes of transportation, particularly automobiles. In these commercials the airlines should mention the advances in technology that have been made that ensure even greater safety when traveling the skies. Some of the new technologies should be highlighted. A newspaper and social media campaign with the same message should be done in conjunction with the television commercials (Johnson, 2014).

Airlines must work to create a quality experience for the customer from the moment they step on the plane to the moment they pick up their luggage. By doing this, consumers will believe that the quality of service they receive during a flight is also reflected in how the airline is ensuring safety during the flight.

7.3 Recommendations for Malaysia Airlines

1. Use Kurt Lewin's Change Model

Since Malaysia Airlines has a restructuring plan, they need to follow the Lewin’s change model to implement the plan successfully. The following steps need to be followed.

Unfreeze: In this step, MAS needs to reduce the forces that are striving to maintain the status quo and dismantle the current mind set. One of the best ways to motivate people to change is to first get people to see the need for change. The need to educate employees in regards the pressures for change is a first step. Get the relevant staff and management involved in the process. Get the message out about who, what, when, where, how, and why changes and improvements are required. Maintain regular and frequent communication lines open with all employees (Kurt Lewin 3 Phases Change Theory, 2014).

Transition: Bring required changes to the individual, departments, or organization. Have plenty of time and plenty of communication. Employees need time to take things in and through the continual communication they will feel more involved and connected to the process. Immediately address any barriers of negative people, and keep things real and coming back to how it relates to the business and the need for change. Provide empowerment for people that is matched to consequences, and their readiness to change. Make use of milestones and measurements. Be open to continual negotiation (Kurt Lewin 3 Phases Change Theory, 2014).

When reducing the employees, the company needs to give information to employees about the business problems and provide some sense that layoffs may be necessary. Speak with a qualified employment law attorney with experience in layoffs. Non-discriminatory practices are a must in layoffs, so who should lay off must be painstakingly determined. If layoffs are necessary, company should communicate it as quick as possible so people can immediately apply for unemployment and start their job search. Company should treat people with dignity (Susan, n.d.).

Freeze: Freezing is still necessary in the continuity of operations. It is necessary before moving on to the next stage of unfreezing again. This is because freezing eliminates confusion for people who may not be sure of what needs to be done if things were not locked in to become standard operating procedure. Be sure to recognize and celebrate success as a standard part of the change process. Use force-field analysis to identify and eliminate barriers to the change sticking, whilst maintaining a forward looking focus on the new installations. Establish performance and reward systems for monitoring the influencing the change consistency. Maintain regular review meetings with key staff and adapt the organisation’s meeting structure and agenda to support the improved status and processes (Kurt Lewin 3 Phases Change Theory, 2014).

This model works whether the changes are strategic and incremental or reactive or anticipatory change. This model provides an outline that assists us to visualize, plan and manage each of the stages of change. I see each stage of this model as being able to be planned, as implementable, and as auditable for achieving successful change management program implementation and business improvement results. Therefore this will help MAS in order to implement its restructuring plan.

2. Follow the AirAisa’s Crisis Management Model

Malaysia Airlines can utilize AirAsia’s recent response as a real-time example. Here are the top five steps for developing a crisis communications plan.

1. Be prepared. Have a crisis communications plan in place BEFORE a crisis occurs. While it’s impossible to plan for everything, having the framework in place ensures a swifter and more effective response. Determine who the critical decision makers are and who will serve as the spokesperson and inform all players of their roles.

2. Get trained. No matter a company size or status, the leadership team should be properly media trained as spokespeople, which will pay off dividends in the midst of a crisis. They need to be prepared by taking the time to practice responses to difficult questions before speaking to the media.

3. Be accountable. Brands involved in the crisis from the start should take responsibility. By giving a genuine and timely response, people will be quicker to forgive.

4. Take action. In the aftermath of a crisis, a company must figure out how to rebuild its brand to regain the public’s trust.

5. Revisit and revise. As a company evolves, new crisis situations will arise and messaging will evolve. A crisis communications plan should be a living document that company revisit annually (Bonello, 2015).

This model will help MAS to overcome the possible future crises because this is a proven successful model implemented by AirAisa. Several analysts have given positive feedback about this model. Since MAS has several issues with its crisis management, this model can be utilized to overcome these difficulties.

8.0 Conclusion

Although Malaysian aviation industry had a strong growth, AirAisa and Malaysia Airlines have suffered an unprecedented number of tragedies in the past year. The possible causes of these accidents include climbing at beyond normal speed, terrorist attack, human error, technical malfunction, inclement weather, pilots fault, hijacking and taking wrong routes. As a result of this brand and reputation have affected, ticket sales decreased, passengers had fear and doubt about the safety and passenger bookings declined.

The SWOT analysis of the both companies have identified that the companies have several strengths and opportunities. However the recently the companies have faced many challenges, threats and weaknesses. The analysis have shown that Malaysia Airlines has more challenges and weaknesses compared to AirAisa.

AirAisa’s current strategies include search and rescue operation, responded right from the top, provided updated Information, the brand changed colour to reflect the seriousness of the matter, changed its focus to crisis management, focused on passengers and their families and had a constant pricing strategy. The evaluation have shown that the crisis management of AirAisa was perfect. Malaysia Airlines strategies had crisis management strategies. They have started restructuring plan including changing the brand name, reducing employees, resetting the operation model, changing the leadership, improving the safety, reskilling and continuous communication. The evaluation of the Malaysia Airlines showed that the company’s crises management was very weak compared to AirAisa. The restructuring plan could help to overcome the current situation but it requires huge amount of money.

There are six different additional recommendation to these companies in order to overcome the current situations. AirAsia needs to build up its brand advantage continuously and Malaysia Airlines needs to use Kurt Lewin's Change Model and follow the AirAisa’s Crisis Management Model. In addition to this both companies need to focus on employee training, improve safety and regulations standards and need to change customers’ perceptions. In my opinion, both companies can overcome the current situations if they follow their current strategies as sell as the recommendations given in this paper.

9.0 References

AirAsia. (2015). About Us: AirAisa.com. Retrieved February 08, 2015, from http://mae.malaysiaairlines.com/profile.html

AirAsia tipped to surmount first major crisis. (2015). vNews. Retrieved February 20, 2015, from http://www.vnews.mv/34003

Air China. (2015). Corporate Culture: Air China Awards and Prizes. Retrieved March 03, 2015, from http://www.airchina.com/in/en/about_us/corporate_culture/airchina_philosophy/airchina_philosophy.shtml

AirGuide. (2014). AirGuide for the Frequent Flyer Magazine. Pyramid Media Group, Inc. ISSN 1542-4707. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Anika, M., Rashed US, S. M., Makid, H. K. M., Naima, G. & Abedin, J. M. (2014). Malaysia Airlines - A comprehensive study on the challenges, scopes & strategic approaches (Term Paper). American International Universality – Bangladesh (AIUB). Retrieved February 20, 2015, from http://jilapipech.blogspot.com/2014_08_01_archive.html

Baker, C. (2015). Concerning Issues. Asian Aviation Magazine: Asian Press Group. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Baker, C. (2014). Exceptional Experience. Asian Aviation Magazine: Asian Press Group. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Beech, H., Jiang, C., Rauhala, E. & Rayman, N. (2014). Questions Remain as Malaysia Declares Fate of Missing Airliner. EBSCO. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Berenson, T. (2015). Co-Pilot Was Flying AirAsia Flight When It Crashed. Retrieved February 08, 2015, from http://eds.a.ebscohost.com.newdc.oum.edu.my/eds/detail/detail?sid=ca5a523d-fcb7-4884-90ec-8daa768764ed%40sessionmgr4004&vid=0&hid=4103&bdata=#db=bth&AN=100705390

Bonello, R. (2015). Crisis Communication: 5 Critical Steps to Take, Modeled By AirAsia’s Recent Actions. Retrieved March 05, 2015, from http://identitypr.com/blog/2015/01/crisis-communication-airasia/

Dr. Hodgson, S. (2015). MH17: Did safety come first? Zayed University: Middle East Journal of Business, Volume-10, Issue -1.

Eschenfelder, P. (2009). Successful Strategies for Aviation Wildlife Mitigation. 2009 Bird Strike North America Conference, University of Nebraska – Lincoln. Retrieved February 28, 2015, from http://digitalcommons.unl.edu/birdstrike2009/5/

Forbes. (2014). AirAsia Boss Tony Fernandes Joins Search For Missing Plane. Forbes Inc. Retrieved February 10, 2015, from http://lms.oum.edu.my/loginft.php

Frizell, S. (2014). Malaysia Airlines Apologizes for Insensitive Twitter Promotions. EBSCO. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Harris, D. (2014). Analysis: Fourth time the charm for Malaysia Airlines? Airfinance Journal: Euromoney Institutional Investor PLC. 01432257.

Johnson, D. E. (2014). PR Strategy for the Beleaguered Airline Industry. Retrieved March 04, 2015, from http://www.commpro.biz/public-relations/crisis-communications/pr-strategy-beleaguered-airline-industry/

Kiasutrader. (2015). AirAsia X - Walking On The Prudent Side. Retrieved February 20, 2015, from http://klse.i3investor.com/blogs/rhb/41531.jsp

Kurt Lewin 3 Phases Change Theory. (2014). Change Management Consultant. Retrieved March 05, 2015, from http://www.change-management-consultant.com/kurt-lewin.html

Lalla, A. (2014). What brands can learn about crisis management from AirAsia. The Economic Times. Retrieved February 20, 2015, from http://blogs.economictimes.indiatimes.com/et-commentary/what-brands-can-learn-about-crisis-management-from-airasia/

Malaysia Airlines. (2015). Company profile: masENGINEERING. Retrieved February 08, 2015, from http://mae.malaysiaairlines.com/profile.html

Missing AirAsia flight is third Malaysia air disaster in 2014. (2014, Dec 28). The Associated Press: Haaretz.com. Retrieved February 08, 2015, from http://www.haaretz.com/news/world/1.634098

Malaysia Airlines to be delisted. (2014). Asian Aviation Magazine: Asian Press Group. Retrieved February 20, 2015, from http://lms.oum.edu.my/loginft.php

Noakes, G. (2015). Air safety in the spotlight. Travel Trade Gazette UK & Ireland: UBM Information Ltd. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Noakes, G. (2014). Malaysia Airlines to keep Heathrow slots. Travel Trade Gazette UK & Ireland: UBM Information Ltd.

O'Reilly, L. (2014). Malaysia Airlines mulls rebrand after MH370 and MH17 disasters. Marketing Week (Online Edition): Centaur Communications. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Otto, B & Pasztor, A. (2015). AIRASIA Flight 8501 Incident, 2014. Wall Street Journal (Online), 1/6/2015, p1.

Petrolino, L. (2014). Crisis Communications Lessons from Malaysia Airlines. SPIN SUCKS. Retrieved February 20, 2015, from http://spinsucks.com/communication/crisis-communications-malaysia-airlines/

Rachel, J. (2015). AirAsia Flight 8501 Climbed ‘Beyond Normal’ Speed, Officials Say. Retrieved February 08, 2015, from http://eds.a.ebscohost.com.newdc.oum.edu.my/eds/detail/detail?sid=6f7a27f5-20f4-4d4f-9247-884fb74d3801%40sessionmgr4001&vid=0&hid=4103&bdata=#db=bth&AN=100516811

Rebuilding a National Icon: The MAS Recovery Plan. (2014). Khazanah announces 12-point MAS Recovery Plan. Khazanah Nationals. Media statement. Retrieved February 08, 2015, from www.khazanah.com.my

Ritson, M. (2014). Malaysia Airlines -- fix don't nix the brand. Marketing Week (Online Edition). Centaur Communications.

Susan, M. (n.d.). 7 Tips for Compassionate Layoffs. Retrieved March 1, 2015, from http://humanresources.about.com/od/layoffs-downsizing-strategies/qt/7-tips-for-compassionate-layoffs.htm

Schofield, A. (2014). Malaysia Airlines' state owner sets agenda for sweeping changes. Aviation Week & Space Technology: Penton Media, Inc. 00052175, Vol-176, Issue-31. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Schuman, M. (2014). Malaysia, the World's Unluckiest Airline, Will Now Struggle to Survive. EBSCO. MAS Ultra - School Edition. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Sinclair, P. (2014). The search for MH370. New Zealand International Review: New Zealand Institute of International Affairs.

Stampler, L. (2015). Hackers Hit Malaysia Airlines Website. EBSCO. Retrieved February 08, 2015, from http://lms.oum.edu.my/loginft.php

Stefan A, K. (2014). Legal Considerations about the Missing Malaysia Airlines Flight MH 370. Air & Space Law; 2014, Vol. 39 Issue 4, p235-244, 10p

Toh, M. (2015). ANALYSIS: QZ8501 crisis deals blow to AirAsia strategy. Flight global. Retrieved February 20, 2015, from http://www.flightglobal.com/news/articles/analysis-qz8501-crisis-deals-blow-to-airasia-strategy-407480/

Veysey, S. (2014). Malaysia airlines leads the pack in year's big losses. Business Insurance: Crain Communications Inc. 00076864, Vol. 48, Issue 16.

Adam Khaleel

Sunday, December 20, 2015

Module Name: Strategic Management

Contents

1.0 Executive Summary