Cultural Challenges Faced by Air Asia in Global Expansion

Running head: MANAGEMENT
Management
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Background of the organization and its environment
Founded in the year 1993 by the government of Malaysia, the second airliner, Air
Asia started its journey in the year 1996. During the consecutive 5 years, the airline industry
failed to bring profit resulting in a great amount of debt of about USD $37 million in the year
2001. The company came in the hands of Dato’ Sri Dr Tony Fernandes and Dato’ Pahamin
Rejab there after foregoing all the debts of the airline. Air Asia started is new journey with an
innovative goal of making the airline much more affordable so that everyone can fly. The
airline was re-launched and re branded with a new life of two Boeing planes (Nugraha,
2016). Air Asia hence for the made a tremendous success in the airline industry and achieved
some of the fantastic outcomes. The mission and the vision of the company are to continue
being the lowest cost airline in the market together with being the best company for working.
The company furthermore aims to maintain the highest product quality with the embracing of
the technology for the reduction of the cost and enhancement of the service level to the
customers. It continues to spread out the way for the low cost aviation through the passionate,
innovation and efficient approaches towards the business. With the aim of the largest low
cost airline, the company serves more than 3 billion people with poor connectivity and high
price ranges (Kaliannan & Adjovu, 2015). The company operates with the lowest cost of the
unit cost near about US $0.030 and the rate of passenger breakdown load factor of 55%. The
company serves a high level of productivity from the crew members that are higher than the
Malaysia Airlines. In the context of the environment of the organization, the CEO of the
company illustrates the importance of the employees of the organization since they form the
backbone of the business. The mission of Air Asia includes developing and creating a
globally recognised ASEAN brand image to (Sharma, 2018). The founding principle of the
organization in the domain of the organizational background projects to be aware at all the
time regarding the engagement in the business platform where the responsibility of the

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customers relies on the company. Some of the safety values of the organization include first
class training session of the employees, high level of job integrity and well maintained
equipments. As per the macro environmental analysis there lays a huge range of scope for
growth for Air Asia (Adapa & Roy, 2017). The environmental factors furthermore anticipated
that for the reason of the rapid urbanization trends the market of Air Asia will continue to
grow at a very fast pace. In the context of micro environment analysis, it can be concluded
that the power of suppliers is high for the reason of limited number of suppliers and the
industrial monopolization. Air Asia with its costs range of lowest range has a competitive
advantage over its rivals.
Introduction
The report will focus on the main cultural challenges faced by the organization of Air
Asia while expanding their business in the global context. It will highlight on the language
and the cultural barriers within the organization as reported by Air Asia (Adler et al., 2017).
One of the many facets of the factor of the human is the presence of a diverse and the
multicultural taskforce in the industry of aviation. The issues or the challenges became more
evident in the organization over the last years move of the migration of the people around the
countries (Huang & Crotts, 2019). Furthermore with the affordable range of the flying and
the increasing demand for the international travel induces the company to hire more people
from different cultures, origins and languages. Organizational culture represents the overall
structure, life style of the company. In the context of the organization of Air Asia , the
perspectives of the culture in the company includes or involves a wide range of the variety of
the elements that including both internal and external collaborators (Wood et al., 2015). Some
of the factors involved in the culture of the organization of Air Asia are the working methods
of the company, the level of the social engagement of the employees of the organization, the
working environment inside Air Asia, the team work, the well being and the motivational

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factors of the employees in the organization. The rising airline of the Malaysia strived to
diversify their workforce by the recruitment of hiring workers varying from different
nationalities and cultural backgrounds. The company aimed towards the benefit of the
achievement of wide range of perspectives and higher ability of the competencies in the
global marketplace (Pounian & Green, 2015). But as per the current reports and the survey
regarding the employee satisfaction at the workplace, Air Asia there has been report of
increased communication challenges, behavioural issues and differences in the personality
leading to miscommunication among the employees of Air Asia.
Explanation of the chosen theoretical framework - Hofstede’s cultural
dimensions
Dimension and the theoretical framework of culture are important aspects of the
international business. The theory of Hofstede’s cultural dimensions includes the framework
that revolves around the factor of the cross cultural communication that has been devised by
Geert Hofstede. This particular report illustrating the cultural barriers and the issues in the
communication of the languages among the organization of Air Asia will include the analysis
of the theoretical framework of Hofstede’s cultural dimensions. The theory looks at some of
the unique aspects of the cultures and analyse the factors disrupting the workplace balance
and the cultural rhythm of the organization of Air Asia (Burns, 2016). This is because this
particular dimension collectively tends to portray the effect of the culture ingrained in the
organization regarding the values of the employees of Air Asia. This theoretical framework is
efficient as compared to the other probable framework analysing the culture since it studies
the significant aspects of the culture providing the factors in a rating scale which is easy for
calculation and understanding.