Recommendation For Company AirAsia and Malindo Air

Our recommendation based on Mickinsey 7’S Implementation framework. As per

space matrix for AirAsia they in Aggressive mode and for Malindo Air they in

defensive mode. Impact from COVID-19 both company had struggled to survive in

this industries. Below are the 7’S implementation framework of Mickinsey:

A. Strategy

Current strategy for both company had to focus domestic route. As other countries do

not enter their border for any visiting due to COVID-19 include Malaysia. Customer

want to fly is limited by both companies have their own unique promotion to attract

customer.

AirAisa have domestic route using Boeing 737 while Malindo Air using ATR which

have more less operation cost for domestic routes. This will give more benefits to

Malindor Air.

Others strategy is to make mass media marketing such as campaign for their

international flight discount for future travelling. In this way both company could have

advance cash flow and could survive in this economic crisis.

B. Structure

Both company had struggled to compete between domestic flight. Diversified their

business could minimize their impact due to COVID-19. As AirAsia have taken

intiative to enhance their others industries such as in Logistic (teleport) ,Marketplace

(airasia.com) ,Digital bank and insurance (big pay & Tune Protect), and lifestyle &

Entertainment (Santan, T&co,Our shop) have give more advantages to give added

value and profit to company. While Malindo Air only focus in their Airlines industries.
Therefore for AirAsia they give more attention for their others industries and for

Malindo Air they should find others industries they could invest such as convert their

flight to cargo flight as per current statistic cargo flight demand had increased due to

customer more convenient to purchase thru e-marketing platform.

C. System

A lot of flight being cancels due to the COVID-19 Impact. Both companies should

come with new management information system for effective communicate between

staff and top management due to any complaints.

Airasia return policies are convert the amount paid for your current flight booking into

a Credit Account which can be redeemed for a new flight booking in the next 730

days or customer could change their flight date without additional charges to any

date before 31 October 2020. They do not implement refund in term of cash.

Malindo Air return policies is provide redemption voucher that must be completed

within 12 month of the date issuance and period of travel is up to 11 month ahead of

date of redemption. They also do not implement refund in term of cash.

Thus both company should have efficient system to handle customer complaint

especial during this global pandemic in order to ensure their reputation do not tarnish

for refund policies.

D. Style

Airasia and Malindo have their own style. Airasia. Each airlines gave their unique way

to attract their customer and maintain their loyalty. Both airlines should maintain

current style to sustain in this economic crisis.

Airasia is well known with tag line with everyone can fly which the promotion based

on “Low Cost Carrier”. Malindo Air is unique due to being categorized as Malaysia

premium airlines which provide in flight entertainment and connectivity and have

special benefit for corporate customer.

Therefore in current situation is good for both airlines maintain their style for treating

their customer.

E. Shared Value

Airasia and Malindo is public listed company. Shareholders concern both companies

stability in this economic crisis and they required they shareholders support and

investment toward their companies.

Airasia have taken initiative to make aggressive action to make market push for

domestic flight in order to maximize their revenue such as campaign RM12 for

domestic flight and had increased the Month of month revenue (MoM) to 30%. While

Malindo air have scrutinized their operation cost and ensure minimum cost operation.

Both airlines have struggled to maintain their shareholders trust for investment. Key

to survive with this current economic depends on their shareholders. Thus, both

companies must retain current operation with minimum cost operation to ensure

more revenue.

F. Staff

Staff is valuable asset to the company. Airasia and Malindo have taken action to

minimize impact economic crisis to their staff.

Airasia have taken action to retrenchment their staff to ensure this company could

survive. Currently Airasia have 1,900 cabin crew members, 172 pilots, and 50

engineers and they estimate to retrench of 250 of their staff. Airasia had no other

choice from organizational restructuring.

Malindo Air had instructed about 70% of its staff to take unpaid leave. This involves

3,400 of its total 4,900 workforce. Malindo Air is the first airlines to instruct for bulks

workforce to go unpaid leave and currently no retrenchment being announce.

G. Skill

AirAsia and Malindo Air have their own skills to attract and managed their customer.

In current situation both companies should employ expertise to enhance their skills to

manage the current operation and their customer.

AirAsia have taken action from their planning that are AirAsia 3.0 & Leveraging their

data to create platforms. AirAsia 3.0 are AirAsia ecosystem comprises the Group’s

core airline network operations, travel and lifestyle commerce platform, financial and

insurance services, logistics services, as well as lifestyle & entertainment affiliates

This skills need to be enhance by expertise to ensure the efficiency.

Malindo Air currently have taken drastic action to instruct about 70% to take unpaid

leave and depends on 30% of their workforce to manage their operations. This 30%

workforce should have excellent skills and required expertise to advise them to

ensure the operation is efficient with minimum cost operation.