Strategic Management of AirAsia

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ASSESSMENT 3: CASE STUDY
Strategic Management of AirAsia

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Table of Contents
Introduction:....................................................................................................................................3
External and internal Analysis:........................................................................................................3
Business level strategy and Functional-level strategy for AirAsia:.................................................5
The impact and implication of leadership, culture and ethics on organisational strategy:..............7
Research and discuss a crucial strategic management issue affecting AirAsia:............................10
Design a practical business goal for AirAsia using SMART:.......................................................10
The organisation industry environment and justification for AirAsia competitive advantage:.....11
AirAsia use vertical integration, diversification, strategic alliances:............................................13
Motivational Theories:...................................................................................................................15
Measurement and Evaluation of the strategic performance of AirAsia:.......................................17
Change management within AirAsia:............................................................................................18
References list:...............................................................................................................................20

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Introduction:
AirAsia is one of the lowest cost air services, which are not only deal with Malaysia but
also 25 numbers of developed and developing countries all over the world. With maintaining a
margin cost AirAsia tries to provide their service into domestics and international. According to
the journal of “The Ascendance of AirAsia: Building A Successful Budget Airline In Asia”,
nowadays with maintaining this low cost and providing good quality services, if AirAsia tries to
introduce their business into a new country, the management have to encounter into huge loss
preliminary. To overcome this circumstance, a specific strategy is very essential, by which
organisation can reach one of the leading positions.
External and internal Analysis:
External SWOT Analysis:
The external analysis of AirAsia can be made through the application of strategic
management tools like SWOT. It can help to identify the vital issue which can harm the future
profitability of this company.
Strength:
 AirAsia is recognised to be the best
airline throughout the worldwide and
also has a right image. The company
uses eco fuel to minimise the air
pollution, and high technology
equipment has been used throughout
Weakness:
 The duration of the travel compared to
the other international flight is taken a
bit time.
 The company has a secondary airport
which consists of a non-central

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the travel
 The Organization had improved its
low-cost model for airline service.
 The company had its first market
collaboration with ICT
location.
Opportunities:
 The customers frequently earn flight
tickets and categorised gold and silver
class according to their travel.
 Partnership with the various reputed
brand which sponsors the company
well as correctly.
Threats:
 Despite the brand name, its air
accidents have occurred mostly in the
past few years.
 Security is the primary concern from
the plan highjack.
Table: External SWOT Analysis
(Source: Swadesh, 2017)
Internal SWOT Analysis:
Internal analysis compact with rectifying all internal faults such as strength, weakness,
capitalises and resource of an organisation that is going to help the organisation to achieve the
ultimate goals and future growth. To attract the more substantial number of the customer, the
airline company is successfully using the marketing and seals business strategy (Grant, 2016).
Strength:
 The airline has a strong management
Weakness:
 The limited human resource is one of

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team.
 To maintain the fuel cost, it had a
robust strategy and done some great
execution controlling the overall budget
the weaknesses of the organisation
Opportunities:
 Including customer service and
operation different from old technology
model.
 Incising the rate of the fuel cost may
decrease the market competition.
Threats:
 Entrance other low-cost airline
company can be a threat to this
organisation
 Security is the primary concern from
the plan highjack
Table: Internal SWOT Analysis
(Source: Asrah et al. 2018)
Business level strategy and Functional-level strategy for AirAsia:
The Functional level strategy According to the journal, “The ascendance of AirAsia:
building a successful budget airline in Asia”, AirAsia is quite well designed and maintain for
expand in the international market. The business strategy divides into some department, and
those are Human Resource, Financial Resource, Marketing and seals team (Niederwieser &
Baldomero, 2016).
Human Resource: This resource includes a support system which is mainly hiring
personal resource, skill development, and application tanning of benefits to the legal structure

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defined by the airline community. The department is entirely responsible for the business
management strategy formed for any organisation.
Financial Resource: Financial Resource is the essential element for the run the airline
system. Sometimes the funds needed to expand throughout the worldwide.
Marketing and Seals Team: Getting value regarding return on its investment, marketing
indicates the number of actions undertaken to make sure that the airline fulfils all the demands of
its regular customer. Like other airline organisation, AirAsia has also not been left out to
promote its brand on social media (Hambrick, 2014).
Business Level Strategy is in core competencies which should be focused on satisfying
customer needs and preference to gain a beneficial outcome and the whole process done through
the business strategy. Business level plan feature proceedings are taken to provide value to
customers and put on a spirited benefit by exploit core competencies in unambiguous,
personality manufactured goods or service markets. Business-level strategy is worried about a
risk situation in the current industrial market, absolute to the participant and the five forces of
competition. To survive the current industry, knowing a customer is very significant, to obtain
and sustain a competitive advantage. According to the journal, “The ascendance of AirAsia:
building a successful budget airline in Asia”, There are four strategies in for any company to set
up a competitive market, and one should undoubtedly follow all these strategies.
Cost Leadership: Building modern state art facilities to attract the customers. Maintain
tight control over production cost and other expenses.
Porter’s Five Force Model: As stated by, Hogg (2016), cost leadership model helps to
control one's business expenses, but with the help of porter five force model one can quickly set