INTRODUCTION Background Malaysia Airlines commenced its operations in 1987 after the The

airline changed its name from Malaysian Airline System.

airline began in 1947 as Malayan Airways, being renamed Malaysian Airways after Malaysia gained independence. After that, it changed its name once more to Malaysia-Singapore Airlines and thereafter ceased its operation. It was then divided into Malaysia Airlines and Singapore Airlines. Malaysian Airline System Berhad (MYX: 3786), DBA Malaysia Airlines (abbreviated MAS), is the government-owned flag carrier of Malaysia. Malaysia Airlines operates flights from its home base, Kuala Lumpur International Airport, and its eastern hub in Kota Kinabalu. It has its headquarters on the grounds of Sultan Abdul Aziz Shah Airport in Subang, Selangor. Despite a financial restructuring exercise in 2006, Malaysia Airlines maintains a strong presence in Southeast Asia, East Asia, South Asia, Middle East and on the Kangaroo Route between Europe and Australia. Malaysia Airlines also operates transatlantic flights from Kuala Lumpur to Buenos Aires, via Cape Town. It operates transpacific flights from Kuala Lumpur to Los Angeles, via Taipei.

1.2

Problem Statement

Tough times for MAS Talk of being No. 1 in Asia is premature, returning to and sustaining profit must be priority. ALL is not well with Malaysia Airlines (MAS). While the situation is dire, it is not impossible for the airline to recover its fortunes but it needs some nifty strategic changes and deft execution. While key officials say they want the airline to be Asias top one by 2015, they dont say clearly in terms of what. MAS is already among the best in the world in terms of service but that does not spell profit with the airline slipping into an operating loss of RM267mil for the first quarter of this year. This airline has been through tough times, slipping into massive losses at several points during its history. With help it has come back from the brink of failure but it has not been able to show the kind of sustained profitability that other airlines such as Singapore Airlines have exhibited. MAS fortunes have deteriorated so much that low-cost carrier AirAsia overtook it in terms of market value earlier this year and seems set to widen its lead as it made a profit in the latest quarter while MAS reported a substantial loss.

MAS has a good product going by the continuing rave reviews for its cabin services. That alone is not enough to make it profitable. As with any business, you arrive at a profit or loss after subtracting costs from revenue. For an airline, the revenue is dependent on capacity and how much it grows or reduces its routes, the load factor which is a measure of capacity utilisation, and the crucial pricing through which you maximise revenues. This is to be juxtaposed with costs, of which the major and most volatile one is oil prices on which the jet fuel price depends. Sometimes, your cost savings justify a cutback in routes but a prudent airline will also consider the long-term impact of such a move because you dont want to constrain future growth. First unprofitability Prior to the Asian Financial Crisis in 1997, the airline suffered losses of as much as RM 260 million after earning a record-breaking RM319 million profit in the financial year 1996/1997. The airline then introduced measures to bring its P&L back into the black. For the financial year 1999/2000, the airline cut its losses from RM700 million in the year 1998/1999 to RM259 million. However, the airline plunged into further losses in the following year, amounting to RM417 million in FY2000/2001 and RM836 million in

FY2001/2002. With these losses, the airline cut many unprofitable routes, such as Brussels, Darwin, Honolulu, Madrid, Munich and Vancouver.The airline recovered from its losses in the year 2002/2003. It achieved its then-highest profit in the year 2003/2004, totaling RM461 million. 2.0 PURPOSE STATEMENT The purpose of this report is to evaluate Malaysian Airline System Berhad in order to identify the strengths and weaknesses. From my observation based on my report and research that I have done, MAS build up a good commitment to achieve goals in the future. They have their tough times but they still can make profit after that. They have their four basic needs which is planning, organizing, leading and controlling (POLC) to improve their skills on the teamwork and the services. 3.0 SCOPE

The evaluation of the MAS is based on products, customer services, location and organization members. 3.1 Products The products are evaluated in term of quality,variety,prices and labeling prices of the products. Check on http://temptations.malaysiaairlines.com/ for more details.

3.2

Customer Services The customer services are evaluated based on staff services toward the customers whether they knowledgeable, friendly, prompt and courteous. Arrange people and other resources work together in structured way to accomplish objective goal of the MAS Airlines.

3.3

Location The location is evaluated by identifying their competitors, whether the place is strategic and they provides their good services. By doing the observation and interview the workers we will look into their competitors such as Air Asia that offering almost similar products and accessibility of the services.

3.4

Organization Members Organization members are evaluated based on the committee members in the organization. How they manage their company towards achieving goals. . Other exiting arrangements include the granting of exclusive concession agreement to a newly incorporated company to market the passenger capacity made available by MAS on scheduled international services.

4.0

SOURCES AND METHODS OF DATA COLLECTION 4.1 Primary Sources Two methods are used to collect the information for the report. The two methods are questionnaires and interviews. 4.1.1 Questionnaires The purpose of questionnaires is to gather information from the customer and workers of MAS AIRLINE SYSTEM on

specifications and services, customer services, location and issues.

4.1.2 Interviews An interview was made at MAS Customer Services KLIA on ------with the Managing Service of MAS , Miss Roslina bt Ali to acquire information on workers, services, issues, key development to success, background, products , location and organization members of MAS. 4.2 Secondary Sources Two methods are used to collect the secondary sources which are brochures and pamphlets, and also internet reviews.

4.2.1

Brochures and Pamphlets We also used brochures and pamphlets to obtain more information on services of MAS AIRLINE SYSTEM. The brochures and pamphlets were obtained form Kuala Lumpur International Airport (KLIA) which they provides catalogue and articles from the office of management MAS AIRLINE SYSTEM to satisfied the customer needs to acquire information about their services. In that also it guide us how to book and plan of the flight, Enrich members may redeem their Enrich Miles for Temptations products and we can gather the information of specifications of the cabin and services. All these reference materials are used for more specific and clear information about their owners, workers and customer so that we could evaluate their company.

4.2.2

Internet Reviews Internet reviews were also used as our resources to get more information on the services and productivity of the MAS AIRLINE SYSTEM BHD company. The company web sites was browsed to obtain more information regarding MAS services and their management. Heres the link of MAS Airline that we obtained to gather more information and as a reference : http://en.wikipedia.org/wiki/Malaysia_Airlines http://investing.businessweek.com/businessweek http://thestar.com.my/columnists http://www.hicbusiness.org