Malaysia Airlines (A) Harvard Case Solution & Analysis

Introduction

The paper attempts to describe the branding strategy for Malaysia Airlines in North America while highlighting the current trends in the airline industry. The paper provides a description of the situation analysis for Malaysia Airlines in identifying the current brand identity of the airliner. Moreover, the paper attempts to focus on the interpretation of internal analysis of the company and helps in evaluating the target market along with the consumer behavior for Malaysia Airlines. Furthermore, the paper emphasizes on discussing the competitive analysis for the airliner and proposes the strategic initiatives and tactics of the company. Lastly, the paper outlines the unique selling proposition while it reviews and measures the proposed plan.

Situation Analysis (North America)

Malaysia Airline is a member of a One World Alliance which is the third largest alliance around the world after Star Alliance and Sky Team with over 507 million passengers. Malaysia Airlines joined the One World Alliance in February 2013. The aim of One World Alliance is to provide good service quality at low cost to the world’s frequent international travelers. The Airliner operates in more than 850 destinations around the world in six continents. The Malaysian government owns 70% of the shares of the company through the government sovereign wealth fund known by the name of Khazanah Nasional. Currently, the company has 96 fleets amongst which the average age of the aircraft is 4.3 years (Malaysia Airline, 2014).

The flag carrier reported a loss in its second quarter of 2014 for MYR 305.7 million which approximates up to $97.2 million. The company has been facing critical situation in terms of financial losses as their loss in 2014 has aggravated the sum of the previous three year losses. This also results in the sixth consecutive quarterly loss for the company (Business Insider, 2014). Many of the Malaysia Airline flights in North America are running nearly empty. The main reason for the loss in revenues has been the two recent incidents of MH370 and MH17 in which one carrier was found missing from the radar and the passengers were presumed dead, while the other carrier was shot down by terrorist groups in the Ukraine and Russia border killing 537 people in total. This reduced the confidence of customers on Malaysia Airlines. The operations of the Malaysia Airline is losing over $1.6 million a single day and about $2.16 million a day in burning its cash reserves (Mashable, 2014). The company has nearly 20,000 employees around the world amongst which the company would make one third of the job cut from its total number of employees. The company and the government realized after several months of the crash that the company needed changes to pursue achieving its future goals and objectives (Govindasamy & Daga, 2014).

Identity

Who is Malaysia Airlines?

Malaysia Airline is the flag carrier airline of Malaysia which was founded in the year 1937 by the name of Malaysia Airways. However, soon after the independence of Malaysia the company changes its name to Malaysia Airlines. The operating of the flights takes place from Kuala Lumpur International Airport (KLIA). The company initiated its business through flying on domestic routes; however, in less than a decade the company started its first international flight. A major milestone for the company was achieved when it received its first Airbus A380-800 aircrafts in the year 2012. The On World Alliance has allowed the company to expand into different regions and destinations. Currently, the company has been covering 850 destinations around the world with a presence in over 150 countries. In the last decade, the company has received more than 100 awards for its excellent service and highly rated in-flight experience of customers.

The core values of the company have been described below:

  • Flying to win customers
  • Achieving operational excellence
  • Consistent Profitability
  • Collaboration
  • Devising winning strategies

What Malaysia Airlines can offer?

In the light of the increased competition in the Low Cost Carrier (LCC) market of aviation and also due to the full services carriers by the Middle Eastern airline companies, Malaysia Airlines have developed their business plan which focuses on the services that it wants to provide to its customers. The current business plan focuses on the new vision of the company, a recovery plan to recover from the consecutive year losses, and a game changer plan to capture the market...........................

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In the first six weeks on the job, the new CEO Malaysia Airlines (MAS), has developed an ambitious plan to turn, including an aggressive job cuts and route exceptions, but MAS largest shareholder, Khazanah Nacional, a sovereign wealth fund, the goal helps to grow Malaysian economy. If Khazanah encourage job and route cuts in the MAS, and how the government would respond to them? Moreover, if the new CEO at MAS to be declared publicly about their intentions?
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by Nabil N. El-Hage, Leslie S. Pearson Source: Harvard Business School 16 pages. Publication Date: November 17, 2008. Prod. #: 209024-PDF-ENG

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