The paper "Current Issues Facing the Malaysian Airlines System" is an outstanding example of a management case study. While debt, fuel prices and capacity are considered the major issues facing the airline industry, there are management issues and unpreventable disasters that slow the productivity and profitability of the firms in the industry. The international airline industry offers services to virtually all corners of the world and is a major portion of the formation of the global economy. However, some of these international airline companies are at the verge of losing their business because of the loss of public confidence and increased losses.
The year 2014 has been an astoundingly a very bad air for Malaysian airlines following the MH370 disaster and the ongoing search for the crew and clients lost somewhere in the Indian Ocean, and the haunting loss of MH17 in Ukraine. While the airline mourns the tragic loss of life from the two incidences, it is apparent that the incidents have taken a potentially critical toll on the Malaysia Airlines brand. This easy highlights the current situation facing the Malaysian Airlines with a particular focus on how the airline can organise human resources and other resources to repair its broken future or establish a novel future as this is the biggest strategic decisions the management faces.
The paper also underlines how the company can reduce its current losses besides improving public confidence. Notwithstanding the horrendous incidents in the past few months, with an apparent strategy and cautious management based on Maslow’ s needs theory, Follet’ s and Fayol’ s management theory that would promote employees’ motivation, productivity and job security, the carrier’ s brand equity can be restored. Background of the Organisation Malaysian Airline is a major airline that operates flights from Kuala Lumpur International airport to destinations in Asia, Oceania and Europe (Gin 2010:194).
The airline was established in 1947 and it celebrated its 60th anniversary in 2007. The company has a developed a brand image in both domestic and international markets and it was awarded world’ s leading airline in Asia in 2011, a 5-star status in 2012 and the group was voted the Best Airline Signature Dish for its Satay and World’ s Best Airline Cabin Crew in 2012 ( Market Line 2013:4).
The Airline was first established as Malayan Airways Limited (MAL) but later changed its name to Malaysian airlines (Gin 2010:194). Malayan Airways Limited operated in the routes from Kuala Lumpur to Singapore, Medan, Saigon and Jakarta. However, with the establishment of Malaysia in 1963, MAL changed to Malaysian Airways Limited. In 1967, MAL became Malaysia-Singapore Airlines (MSA) with its services extending to London, Rome, Perth, Taipei and Mumbai. Although MAS favoured domestic connections, Singapore looked for more international destinations leading to an inevitable split in 1972 that led to the formation of the Malaysian Airline System and Singapore International Airlines(Gin 2010:194).
Assuming a new logo in 1987, MAS became Malaysia Airlines. The company attained multiple tributes and increased profitability. By 1992, Malaysia Airlines became a profitable and respectable international airline with a labour force of 19, 000. In 1994, the Malaysian government privatised its controlling authority. Within 6 years after privatisation, MAS experienced devastating debt amounting to RM 9.5 after four years of constant losses. In 2000, MAS was renationalised as a government-related company and in 2007, the company earned its highest profits in its history (Gin 2010:194).
Currently, the company’ s brand is at stake following a series of accidents that have lowered public confidence besides increasing the company’ s losses.