Organizational Structure of AirAsia

Organizational Structure of communication channelAsia1.0 Introduction nowadays, the use of culture engineering plays a vital role for businesses to compete and succeed. According to Laudon and Laudon (2010), al near the altogether firms and organizations use discipline technology to survive they send in information technology and systems because these investments lead return a lot of goods, much(prenominal) as an ontogenesis in productivity, a decrease in fol pitiables and an gain in revenue. Information systems provide information for managers which help them to make disclose decisions and improve operations. This assignment will look at the largest low represent carriers in Asia Pacific region AirAsia Berhad, which is kn give as AirAsia. In this pee-pee we will analyse how organization has getrfully utilise information technology and systems to improve their business. In addition, this paper will look to IT strategies of Air Asia and to nigh businesses processe s within organization where information systems were successfully implemented.Organization backgroundIf you pauperism to understand today, you submit to search yesterday. (Pearl Buck)Gener anyy, without bypast, in that location is no future and all(prenominal)thing in our life has his history. Thus, it is brief Air Asias background scratch of all, AirAsia was founded in 1993 by Malaysian government as a second port hoser to the major subject field air play along MAS (Malaysian Airlines) and AirAsia started operating after three years on 18th November 1996.During the following 5 years, AirAsia failed e genuinely year to bring pelf, as a result AirAsia had a great debt of about USD $ 37 trillion in 2001. However, this while is the sentence when the authoritative story of the largest low-cost respiratory tracts began. In 2001, Dato Sri Dr Tony Fernandes with ploughsh beners Dato Pahamin Rejab (former chairman of Air Asia), Dato Kamarudin Meranun, and Dato Aziz Bakar pur chased the AirAsia from Malaysian constituteer HICOM Holdings Berhad (now known as DRB-HICOM Berhad), for a symbolic price RM1 (USD 0.25 cents), and agreed to close the debts of the company. (AirAsia Annual Report, 2008, p.3)They started with an innovative name and address to make air travel cheaper and to a greater extent affordable to people that Now Every nonp atomic look 18il Can Fly. AirAsia was re- va look at and re- ensnareed and started invigorated life with ii Boeing B737 planes, approximately 250 rounds and had only tailfin destinations to Kota Bahru, Kota Kinabalu, Kuching, Labuan, Langkawi and Penang. According to AirAsia website, today after 10 years Air Asia has almost 100 air planes and flies to to a greater extent than 60 destinations from 23 countries. Additionally, Air Asia operates more than 3,500 flights a week and has around 8,000 staffs. In 2009 AirAsia ferried more than 22 million passengers and AirAsia is ASEAN (Association of South Asia Nations) ca rrier. (AirAsia Annual Report, 2009, p.4)It contri yete be clearly seen that AirAsia has do a tremendous success in air duct attention and it is interest to know what and how managers of AirAsia use to achieve this fantastic outcome. It will be get dressed forth subsequently in following chapters.Organization Vision and Mission.Nowadays every organization has mission and vision statements, which show what organization is (mission) and a judgment of what organization wants to be (vision). (Harrison and John, 2009) In addition, the mission statement of the organization must(prenominal) be broad because it is an umbrella which encompasses organizations programs and usefulnesss. (Angelica, 2001)1). AirAsias VisionContinue to be the terminal cost airline in every food merchandise we serve.2). AirAsias MissionTo be the best company to work for whereby employees are treated as startle of a big familyCreate a globally recognized ASEAN brandTo attain the lowest cost so that e very hotshot can fly with AirAsia affirm the steepest persona product, embracing technology to reduce cost and leaven assist level (AirAsia website) fear Strategies and succeeder movers.Without a strategy the organization is give care a ship without rudder, going around in circles. (Joel Ross and Michael Kami)Air Asia Success factors.AirAsia has achieved a tremendous success since its renovation. Because of some success factors AirAsia gets some free-enterprise(a) advantages in airline competition. By using it AirAsia is the best lowest cost airline company in South Asia. The lynchpin point of Airasias success factors is to deliver low fares is to consistently keep cost low. Providing low costs needs the high efficiency in every part of the business. Thus, every part of organization, every system process, everything must incorporate best industry practices. AirAsiaa success factors can be analyzed in the core determine of the organization. AirAsia gets emulous advantages and makes their business successful by using these key strategies safety device First golosh is the most vital criteria in every part of the organization operations safety is the area where AirAsia will never agree on. each(prenominal) conditions, which determine by regulators in the countries where AirAsia operates, are complied by the largest low fare airline. Furthermore, partnering with the worlds most renowned maintenance providers to be ensured that AirAsias airplanes al ship itinerary in the best condition.High Aircraft Utilisation The AirAsia airplane captains ability, to make a fast-flying turnaround of 25 minutes which is the fastest in the region, is more handy for customers to travel. It has resulted in high aircraft utilisation, better airline and staff productivity and cut costs.Low Fare, No Frills Providing to guests to rent the choice of buying exclusively on the watch meals, snacks and drinks from in-flight service at an affordable price.Streamlined Oper ations The important key of the AirAsias success is to make processes are sincere as possible.Leans Distribution carcass Offering a commodious and innovative range of distribution transmit to make booking and travelling easier.Point to Point Network Applying the point-to-point earnings keeps operation simple and lower costs. Most of the AirAsias flights are short drag on (four-hour flight radius or less) which helps to keep lower costs.Company Business Strategy.The Business Strategy of AirAsia is To continue to be the lowest cost short-haul airline in every market it serves, delivering real organic growth d one offering the lowest airfares at a uprofit.This strategy focusing in six main strategic thrustsLeanest Cost StructureEfficient and simple point to point operationsAttracting and retaining hardworking and smart people heating system for continuous cost reductionMaximise Shareholders ValueResilient profit growth through our lower cost baseExpansion of the AirAsia mes hing in a prudent and disciplined mannerInvest and enhance the AirAsia brand to sum up investors returnsSafetyComply with the highest International Aviation Safety Standards and practicesKeep operations simple and transparentEnsure the security of our throng and GuestsPassion for Guests SatisfactionMaintain simplicity in every diligencePractice the unique and friendly AirAsia experience at every chanceRecognize the linkage between guests satisfaction and long-term success transparencyTransparency in decision-making and information sharingOptimum disclosure higher(prenominal) than industry normsTimeliness in disclosing informationHuman Capital phylogenyInvest in some(prenominal) hard and soft skillsRecognize all our People as contributors to our successReward excellence and individual contributionsMaintaining one brand crosswise the GroupAnalysis of the current Business environment. labor Analysis Porters Five Forces Model.1. Bargaining Power of SupplierFirst of all, it can be clearly seen that the main AirAsias supplier is the airplane suppliers. Generally the causality of airplane suppliers is very strong because of monopolisation in airplane manufacturers there are only two types of airplanes Boeing and Airbus. The switching cost for airplane suppliers is very high due to expensive needs to substitute airplanes, for example it will be very costly for AirAsia to change airplanes and train employees to be employ of new airplanes. To be honest, nowadays, only several(prenominal) airline manufactures exist in airline industry, thereof the cater of airplane suppliers is very fantastic. If we look to former(a) suppliers, such as, fuel, food and other suppliers, it is clear that their power is not so strong because AirAsia can change them and it will not affect to costs. The increase in price can be risky for these suppliers because AirAsia can deliver working with them.2. Bargaining Power of BuyerGenerally, the power of customers is always high beca use there is no any switching cost for customers to change from one airline company to another, however in this sheath, it can be opinion that the output of AirAsia is very unique and fantastic in South Asia region. In addition, there will be switching cost for customers who want to change AirAsia to another airline company, as a result the bargaining power of buyers is low.3. Threat from SubstitutesIn South Asia region there are several possible substitutes for airline industry, such as trains, buses, cars or ships. However, the prices for other substitutes are more expensive or at the same level, comfort, time expense and other factors during the travelling are more worse than in irline travelling. Nowadays, air travelling is faster, cheaper and more comfortable, as a result menace of substitutes is crack uply low.4. Threat from New EntrantsAirline industry is very expensive for new organizations to entrance into this industry. New organizations must have a big gravid, stron g support from government and must correspond for some requirements for airline organizations. on that point are difficult barriers for new organizations, for instance cost advantages of existing airline organizations, brand loyalty of customers, high switching costs for customers and government restrictions. Therefore, the threat from new entrants is low.5. Rivalry IntensityIn general, the competition between airline organizations in Malaysia is not very strong. There is only one contest for AirAsia in Malaysian airline industry is Malaysian Airlines (MAS) which can be considered as a friendly rival. Thus, the intensity of rival is low in Malaysian airline industry.3.3 AirAsia Competitive Advantage.The strategic positioning has several ways in which the company can achieve agonistical advantage. For instance, offering standardised benefits for a lower cost to customers or retain cost but offer greater benefits for customers. In the case of May intrust, the strategy used by the company is to preserve the value of banking products and services, while offering great benefits and value, as well up as the good quality of their products and services.Focusing on the sorting and quality of their products and services, Maybank exercise their competitive advantage. In particular, through its subsidiaries Maybank provides a wide and diverse range of products and services. That allows its customers to use multiple services in one banking host. By entrusting their money to the time-tested bank, whether it be insurance, private banking or as punctuates management. All this, along with high quality services and highly professional staff of the bank throw convenience for customers, thereby increasing competitive advantage. nonpareil of the important factors in achieving competitive advantage of Maybank is to improve the quality and bucket along of services through the introduction of information technology. Maybank since its inception is looking for ways to make lif e easier for its customers, through improving the quality of its services. Information technologies have played an important role in this. Maybank always has been the first to set off new technologies, thus providing greater benefits and opportunities for its customers.4.0 Analysis of the Current IS/IT Strategy Environment and IT solutions of Maybank.Yield Management System (YMS)It is also known as tax income Management System it understands, anticipates and reacts to the behavior of customer to increase revenue for the organization. This takes into report card the operating costs and aids AirAsia to optimize prices and allocate capacity to maximize expected revenues. The optimization is done on two levels in AirAsia lav (Every seat is considered an opportunity to maximize revenue. Seats are available at various prices in different points of time. A reservation done at a later date will be charged more than the one done earlier for the same seat)Route (By adjusting prices for r outes/destinations that have a higher contract when compared to others). The effective method however is to combine these two levels for all flights, all routes so that both the seat and the route are effectively priced for all the flights.AirAsia has realized increased revenue (3-4%) for the same piece of aircrafts by taking advantage of the forecast of the high/low demand patterns, effectively shifting the demand from low control to high period and by charging a premium for late bookings. Over the past equal of years, AirAsia have actually lowered prices (essential for LCC) as the YMS has effrontery over them the window to increase their revenue by offering higher discounts, more frequently during off-peak time while raising prices only marginally for peak times. (Voneche, n.d).Computer reticence System (CRS)AirAsias CRS (Open Skies by Navitaire) has helped it to grow at a dramatic measure in the past couple of yearsNavitaires Open Skies technology has really enabled Air asias growth from 2 million passengers to 7.7 million passengers in less than two years. Open Skies scaled easily to accommodate our growth. Tony Fernandes CEO AirAsiaSource Navitaire (http//www.navitaire.com/res_and_dist/openskies.asp)It is an integrated web-based reservation and inventory system. It includes lucre, call center, airport departure control and more. It is a direct sales engine that effectively eliminates the middleman (travel agents) and the sales commissions that need to be paid to them. Centralized customer data is also well-kept by Open Skies and this helps AirAsia to track booking and schedule flight activities with real-time, on-demand account sport. The vast booking information that is provided online to the customers acts as a force that brings more customers to use the website thus reducing the customer support costs. An important feature is that Open Skies seamlessly integrates with the already implemented YMS so that the systems can be used in unison f or pricing and revenue maximization (by providing information on bookings, schedules etc) and driving down the costs of operation at the same time. This CRS enabled AirAsia to face the first ticket less travel option and also provides features such as advanced boarding passes in addition to online booking that enabled the growth of AirAsia as these features attracted customers that did not have the time for purchasing tickets from counters and coming in 1 hour early for securing a seat on the aircraft. AirAsia have proposed to implement a Wireless Delivery System(WDS) to expand its legislate via lively phones. With this, potential customers will be able to book tickets via their mobile phones. This is a strategic move for growth as the Asia-Pacific region has a larger population of mobile phone users rather than mesh users. go-ahead Resource Planning System (ERP)AirAsia has recently (May 2005) opted for a full mature ERP system implemented by Avanade consultants. By implementin g this package AirAsia is looking to successfully stay fresh process integrity, reduce financial month-end closing processing times, and recreate up reporting and data retrieval processes. (Microsoft Malaysia)4.1 IT and IS deployed by Maybank.It can be said that Maybank has been always be on the way to improve quality of their products and services, thereby satisfy all the needs of their customers. In other lecture Maybank has been always innovated its products and services by implementation of IT. If to look back to the past we can see that Maybank was the leader to introduce new technologies to the market. For instance, Maybank was the first to guess on a computerisation programme, First to implement the use of ATMs and establish a shared ATM network with its subsidiaries, First to introduce Phone banking and First to introduce Internet Banking.In 1981, Maybank was first Malaysian bank to set up Automated Teller Machine (ATM) services.(annual report, 2009). Since that time May bank increased the number of ATMs, with each year. ATMs give a lot of opportunities and benefits to the customers of the bank. Such as, penetration to own account 24 hours/7 days a week, fast property withdrawal, cheque book and statement request, fund transfer between own accounts and funds transfer to third party accounts. Furthermore, Maybank was first domestic bank to implement MAS electronic Ticketing at their ATMs, this enable Maybank customers ticketless air travel in Malaysia on Malaysia Airlines. Later, due to its expansion to the South Asia markets Maybank launch the Maybank RegionLink Service. RegionLink Service allows Maybank customers in Malaysia, Singapore, Brunei and Philippines to access ATM transactions at any Maybank ATM in these four countries. To effectively physical exercise and managing its ATM network as well as to enable their customers to have a better service, Maybank uses automated fibber machine management software from Diebold Inc.Without a doubt, th e Internet is one of the most important technological advances of recent years. The rapid development of information technologies have created vast opportunities for companies to reduce operating costs, increase speed and quality of their services, as well as the creation of additional benefits for their customers. Because of this and to create competitive advantage Maybank launch its Internet Banking.Basically, Maybank launch Internet Banking through its online financial ingress maybank2u.com in 2000. This portal bring the convenience of online banking for its customers, who can open an account, check balances, transfer funds, settle bills and shop online via this site, which employs 128-bit SSL security technology. Later in 2001, Maybank launch its E-bills service, which can be used only by their customers. At that time there were 325 business organisations that were able to accept payment through internet banking. Conducting funds transactions over the internet has been convenie nt and quick. This allowed the company to pass on RM 500 million monthly total average transaction. In 2003, Maybank launched Internet Banking Kiosks. It enable their customers to undertake internet banking transactions in provided terminals at its branches.To maintain its leadership position in internet banking services, in 2006, Maybank launch supple Banking services in collaboration with Celcom and Maxis. It was the first mobile banking in Malaysia . It allowed Maybank customers to access to the three most popular applications of Maybank2u.com bill payment balance head and fund transfers. From that time, Maybank customers have the convenience of undertaking selected banking transactions in real time via the mobile phone.In order to improve its efficiency and service MayBank concluded a series of deals with companies such as CSC and Microsoft.The main prey of IT infrastructure outsourcing agreement with CSC was to improve their IT services to position it for global economic g rowth and, in the case of major disasters, to reduce its recuperation time from three days to less than eight hours. The data center was travel from Maybanks headquarter to a secure and modern CSC facility. In addition, CSC set up separate data center for disaster recovery that fully duplicates all of the banks sarcastic data across all platforms. CSC also provide simultaneous partnership between bank branches, the main data center and disaster recovery center. This deal allowed the company to reduce response time, to increase productivity and transactional speed.An enterprisingness Subscription Agreement with Microsoft Malaysia to adopt a common software toolset for Maybanks desktop applications has given Maybank the ability to promote greater communication among employees and customers and to enhance cost efficiency. cardinal of the results of this agreement was increasing efficiency and productivity of the employees.4.2 Impact on the usage of IS/IT by Maybank.In general, the use of information technology has a world-shattering have-to doe with on the work of the enterprise. Effect of IT can be both at the organization, its efficiency, as well as to clients and their relationship to the company.In the case of Maybank, IT was one of the essential factors of growth and continued leadership of the bank. Maybank always has been a pioneer in the introduction of the use of IT, which allowed the company to achieve current benefits. These benefits include competitive advantage, achieving the goal of the company, better service for customers and increase simoleons and market share.Maybank was able to improve their service through the use of information technology and information systems. Provision of banking and financial services through a network of ATMs and internet banking has allowed its customers to access their accounts anytime and anywhere in the world. Also, the IT/IS have an impact on the reduction of transaction costs and the time spending on tran saction, that is convenient for customers. Customer relationship management system has been significantly influenced by information technologies. Increasing the ways of interaction between the company and customers, has given Maybank opportunity to increase and improve understanding of the needs and desires of customers. All this resulted in improved service and customer satisfaction, as well as the pellucid convenience for customers of Maybank.Paying great attention to the use and implementation of IT, Maybank thus creating conditions for improving efficiency and productivity of their employees, as well as facilitating a repository of knowledge and being able to share this knowledge across the organization. In Maybank firmly believe that effective knowledge sharing is a source of competitive advantage. Also providing new products and services Maybank has a competitive advantage. At the same time, it is a temporary competitive advantage, because competitors can later enter the mark et with similar products and services. Therefore Maybank is always on the way to improve its service.On the other hand, Maybank as a pioneer in the introduction of the usage of IT has the first-mover advantage. This has a significant impact on enlarging market share. Also, the IT/IS has an impact on the reduction of transaction costs and human capital costs. All this has allowed Maybank to increase profits and market share.Increased profits and market share, competitive advantage and better service has given Maybank an opportunity to achieve its goal. Namely to become a leading banking group in Malaysia, and set the following goal to become a leading regional banking group by 2015.5.0 ConclusionTechnical progress is coming more pronto than ever before, thus, affecting all aspects of a typical company. Today, it is vital to the company to use information technology in order to work. It is become all important(p) factor for the Maybank to employ IT/IS in order to compete in digital world, where almost everyone use IT. Nevertheless, it is important to remember that the most important factor still is the people and companies such as Maybank also need to invest their money in staff training, in order to be competitive enough or even to create competitive advantage. Because it is the people who create it.