Culture Air Asia Case study 2022

Organizational Culture
Air Asia
Student’s Details

Culture: Air Asia 1
Contents
Introduction......................................................................................................................................1
Air Asia: Background......................................................................................................................1
Organisational Culture.....................................................................................................................2
Cultural theories...........................................................................................................................3
The theoretical framework of organisational culture.......................................................................4
Organisational cultural model or onion model............................................................................4
Artefacts and symbols..............................................................................................................5
Espoused Values......................................................................................................................5
Core Assumptions....................................................................................................................5
Cultural change............................................................................................................................6
Analysis of practices and issues......................................................................................................6
Artefacts in Air Asia....................................................................................................................7
Espoused Values and Beliefs.......................................................................................................7
Assumptions in Air Asia..............................................................................................................8
Conclusion.......................................................................................................................................8
Bibliography..................................................................................................................................10

Culture: Air Asia 2
Introduction
Managers need to understand the culture of a company for the growth and success of a
business organisation. Interaction in cross-cultural situations is crucial. Poor awareness and lack
of understanding about cultural might lead a poor impact on organizational strategies or business
decisions. Thus, increases in developing a successful business understanding of the culture of the
organisation are essential (Matthews & Thakkar, 2011).
Organizational culture is defined as shared values, beliefs, assumptions, and ways of
communicating and interacting for the social contribution of an organisation. Organisational
culture defines an organisational environment that includes organisational values, expectations,
and experiences that guide to organisational members to behave in a certain manner. Members of
an organisational reflect organisation by self-image, working ways, in future expectations and
the way they interact with the outside world (Gotham Culture, 2020).
Air Asia is a low-fare Malaysian airline company known for its prominent work culture
in the world. It is the organisational culture of the company that makes to the company as one of
the healthiest cultural company in the aviation industry. Role of organisational culture in the
event of the company has been discussed in this study. The company faced an acute downfall
and was in huge debt before 2001. Due to huge debt company has been sold to Tune Air Sdn
Bhd Company in the year 2001. In the new leadership of Tony Fernandez, company regained the
market position (Chowdhury, 2018). To understand organisational culture of Air Asia resahped
event of the company has been discussed. Further, this study discusses the organisational culture
of Air Asia to know the concept of organisational culture and recreation of the organisation with
applying theoretical framework given by various social scientists such as Hofstede and Edgar
Schein.

Culture: Air Asia 3
Air Asia: Background
Air Asia is a Malaysian based low-fare airline established in 1993, headquartered in
Kuala Lumpur, Malaysia. The airline company originally founded by a government based
company, later in the year 2001 it had been sold to Tune Air Sdn Bhd due to heavy debt. Now it
is the largest airline in the country with operating domestic and international flights all over the
world (Air Asia Berhad, 2009). Enormous affords and hard work of organisational leader namely
Tony Fernandes launched new hubs within one year's shorter time and in 2003 launched its
international flight and started to operate in international flights. Now it has become a second
powerful airline in Malaysia. The company is growing continuously at an international platform
with having the vision of becoming the largest low-cost airline in the continent and serving
millions of people who are unserved due to cost and low connectivity (AirAsia , 2011).
Organisational Culture
Organisational cultural theories focused that in an organisation common set of values,
beliefs, practices, and assumptions shared by the people or group of people in the organisation.
Organisational culture is a multi-dimensional aspect in which majorly includes seven key
dimensions to make organisational culture. Structural stability is one of the major dimensions of
organisational culture. This organisational structure shows the organisational hierarchy in the
organisation. This hierarchy is built to organisational members and bound them with values and
beliefs. An organisational culture has a wide range throughout the organisation. Within the
organisation, culture tends to be universal and touches every part of the organization. Members
of an organization accepted the culture to be part of the organization. Culture is so deeply
inherent that it presents any group of people within the organization. It is difficult to separate or
cut off the people from the culture. When organizational managers act in a certain manner, peers

Culture: Air Asia 4
in the organization consciously or unconsciously adapt to the same. Besides, culture is visible in
the behaviour of organizational members. The impacts of organizational values, beliefs and
assumptions are strong that people can see cultural prints in their daily life’s and it makes their
beliefs coherent (Marmol, 2014). To understated the culture various cultural theories have been
given by the various social scientist and researchers.
Cultural theories
Edgar Schein's model of organizational culture comprises three levels of organisational
culture such as artefact, values, and assumptions which collectively made organisational culture
(Dauber, Fink, & Yolles, 2014). Another great cultural theorist developed six dimensions of the
cultural model that includes power distance index, individualism vs. collectivism (IDV),
uncertainty avoidance (UAI), masculinity vs. femininity, long-term orientation vs. short-term
orientation, and indulgence vs. restraint (IND) (Beugelsdijk & Welzel, 2018). The three tier
model of organisational culture given by Edgar Schein is most suitable to understated
organisation culture of the Air Asia airline company. The major issue in the growth of Air Asia
was values, beliefs, and assumption of organisational leader Tony Fernandez. The cultural
framework of the Schein layer model effectively discussed organisational culture, values, beliefs,
and assumptions. The other cultural framework such as deal Kennedy organisational dimensional
model is more effective to understand rites and rituals in the organisation (Awadh & Saad,
2013). The cultural model of Hofstede discussed national and regional factors of culture.
(Hofstede, 2011)

Culture: Air Asia 5
The theoretical framework of organisational culture
A management professor Edgar Schein has developed an organisational culture in 1980.
This model is helpful for organisational leaders to understand and developed a healthy
organisational culture in business settings and to make visible to culture in the organisation. This
culture model is also well-known as the onion model of culture (Schein, Organizational Culture
and Leadership, 2004). According to Schein organisational culture is a complex and difficult
concept to understand. The organisational model of Schein develops the understating for
required changes in the organisation. Schein gave a concept of the direct and indirect mechanism
inside the organisation. The organisational cultural model of Schein is directly influenced by the
direct organisational mechanism. The direct organisational mechanism includes the exemplary
behaviour of leaders, status, opinions, and appointments. The indirect mechanism of the
organisation comprises mission and vision statements, guidelines, logo, symbols, ritual, and
corporate identity of the organisation (Tharp, 2018).
Organisational cultural model or onion model
The cultural model of Schein has three levels of organisational culture in practice.
Different level or layers of culture consists of different attributes of organisational culture. Outer
or upper layers consist artefacts of organisation. It believes that the outer layer of culture is easy
to adapt and change (O’Donnell & Boyle, 2008). The deeper the culture layer, the harder to
change and adjust. The second or mid-layer of culture included organisational values which are
quite difficult to adapt and change. The core value of an organisational culture includes
assumptions. Assumptions in an organisation are very hard to adapt, change and adjust.
Assumptions in a culture are the way to work in the organisation. There is one more layer
between outer layer artefacts and mid-layers of heroes, they are organisational leaders. Heroes in

Culture: Air Asia 6
an organisation play crucial roles and they are identifying faces of the organisation (Mulder,
2020).
Artefacts and symbols
Artefacts and symbols of the organisation are surfaces of an organisation. The artefacts
and symbols are visible elements such as architecture, structure, business logos, dress codes, and
processes in the organisation. Artefacts and symbols are visible or recognizable for
organisational members as well as external parties (Yilmaz, 2014).
Espoused Values
Organisational goals, vision, mission and strategies, philosophies, and marketing methods
come in the second layer of organisational culture that is the values of an organisation. It is
difficult to set goals, vision, and strategies and frequent change in them. But according to change
demand, the value of an organisation can change (Tran, 2017).
Core Assumptions
Core assumptions of organisational culture are deeply embedded in the culture of the
organisation. These assumptions are made and developed by the self-evident and unconscious
behaviour of organisational leaders that are known as heroes. Assumptions in the organisation
are hard to identify and recognize by anyone (Burkus, 2014).
Cultural change
Organizational Culture model of Schein provides an insight to adopt and develops
changes in the organisation. Edger Schein suggests that the organisational change is important to
communicate with the organisational members and employees to identify underlying
backgrounds and aspects of the culture in the organisation. Organisational leaders need to create

Culture: Air Asia 7
awareness in employees for organisational changes that develops acceptance for changes in the
employee. Employees in the organisation should be aware of the transportation process that
includes potential adoptive behaviour, norms, responsibilities and external changes such as logo
and dress code (Schein, Organizational Culture and Leadership, 2016).
Analysis of practices and issues
This chapter discusses the analysis of practices that Tony Fernandez as the new leader of
the company had implemented in the form of a set of values and beliefs to reshape the company
organisational or corporate culture. Various definitions of organisational culture have been
discussed in the above chapters; Schein defines in only six words that are organisational culture
is 'the way do things around here (Borys, 2012).' Thus organisational behaviour in Air Asia is the
collective behaviour of organisational members towards organisational vision, goals, system,
shared values, and believes working language, habits, and organisational symbol. With the new
tagline ‘now everyone can fly’ introduced by CEO Tony Fernandez, showing the Air Asia low
fair philosophy to make it affordable for everyone. The Air Asia Company aims to make easy,
convenient, affordable and fun travel for its customers (Air Asia , 2020). According to various
statements delivered by Tony Fernandez keeping high aims and working on them is a key to
success. This visionary statement of Tony Fernandez reflects visionary, hardworking, proactive,
patience, proactive, decision making and risk-taking personality as a leader or hero of the Air
Asia company (Merez, 2017).
To analyse and discussed that organisational culture of Air Asia, here researcher using
Schein's three levels organisational culture model in the framework in Air Asia. This three-level
model of organisational culture enables us to analyse the culture of Air Asia from an
observational level.

Culture: Air Asia 8
Artefacts in Air Asia
To promote and enhance Air Asia sprit and developed a family atmosphere in the
company designed strong communication channels and activities to interact with each other in
the organisation. Organisational leader Tony Fernandez beliefs that employees are the most
important and valued asset in the organisation, and they work as driving forces for the success of
the organisation. To create success stories the Air Asia follows the principle of ‘one culture, one
people, one Air Asia and one family.’ The CEO and employees of the company reflect
organisational artefacts through their dressing styles such as red T-shirts, red cap with Air Asia's
trademark logo. These logos and symbols of the company can be seen on Air Asia air crafts and
in promotional strategies of the company (Air Asia Annual Report, 2016).
Espoused Values and Beliefs
The values and beliefs of an organisation include organisational vision, mission, goals,
and strategies to achieve organisational objectives. The core message of the company is ‘ONE
airline, ONE vision and ONE people’ which shoes integrity in the organisation.
In Air Asia, the leader of the organisation aims to create a healthy working environment
of the organisation. The core values of the organisation are fun, hardworking, caring, safety
conscious and passionate and integrity (Air Asia, 2020).
Fun is within the organisation believed as core value of the Air Asia. To engage employees in
fan activities which includes, sports activities, social engagements and volunteering works, green
initiatives and Air Asia’s annual parties. The company recently established new department
namely Green & Sustainability which is inspired by the CSR campaigns # GREEEN24 of the
company. Company also founded a football club under the recreational activities of the company
(Air Asia, 2020).

Culture: Air Asia 9
The other key value of Air Asia is employee empowerment and employee satisfaction. The
company believes in highly people oriented facilities. Organisational mission and work strategies
ensure employees' safety and security. Company believes to gain the success, it is important to
take care of employees. This, for employee satisfaction and motivation, company runs various
programs such as training. Company also develops healthy relationship among employees and
foster the unity in work culture. Company pours hard efforts to increase capabilities and
potentials in employee through training programs, seminar, and workshops. As per the Tony
Fernandez, satisfied employees are more able to take good care of gust and to deliver high
quality services for guest (HRM Asia, 2019).
Company is also safety conscious for employees and gusts or clients of the company.
Various programs run by the organization to reduce risk and hazards that normally occur in the
aviation industry (Darbi, 2012). The Air Asia Company has implemented Safety Management
System (SMS) to improve safety services. To ensure safety and security SMS department of the
company ensure the effectiveness resources and equipment and communication channels in the
organisation. The Air Asia Company has implemented three major strategies such as safety
review board (SRB) meetings, safety review meetings (SRM) and safety action group (SAG)
meetings to assessing safety measures regularly (Air Aisa, 2016).
To achieve organisational goals, the company believes in the principle of “Excellence in
the performance.” Thus, Air Asia conducts regular training programs to ensure quality services
provided by the company and to develop employee skills for high performance. Training
programs includes safety and security learning with providing premium hospitability during
travel. The company also has a highly efficient customer relationship management department
to provide easy reservations and check on, boarding and inflight experiences and baggage

Culture: Air Asia 10
handling. In order to customer relationship company also has good baggage services. Company
has polices for cabin and check-in baggage service for comfortable travel of guests (Air Asia,
2020). To develop healthy customer relationships and easy services Air Asia also introduced self
and web check-inn. Company also gives the facility related flight details and status and provides
these details on the website (Air Asia, 2018).
Assumptions in Air Asia
Cost minimization and effective strategy of the company support the tagline statement
that is 'Now everyone can fly.' The major focus of the company is to make the services reachable
for maximum people.
The organisational culture of the company also gives a great sense of empowerment to
the members of the organisation that are known as 'Stars’ although the organisational culture of
the organisation is inspired by the bureaucracy, still, the company provides an environment
where employees give their opinion and ideas (AirAsia.com, 2018).
Analysis of organisational culture (Air Asia)
Air Asia company has a human resources management department or team to welcome
and train the new employees for organisational culture. Air Asia strongly believes in the positive
contribution of organisational culture for the success of the organisation. Thus the company has
organisational culture department to monitor the culture of the organisation. The core values of
the company are fun, hardworking, caring, safety conscious and passionate and integrity.
Company has implemented various programs and policies to shows and enhance the values in
organisational culture of the company.

Culture: Air Asia 11
Conclusion
Organizational culture is a fundamental element to lead to organizational growth and
success. The concept of culture has been defending by the various social scientist and researchers
and revised as per new studies and findings. In common, organizational culture is a 'way to do
things around here.' Schein defined organizational culture as organizational artifacts, shared
values, beliefs, and basic assumptions.
This study gives an insight into the organizational culture of Air Asia airlines which is
one of the most prominent companies in the Aviation industry. In the history of Air Asia, it is the
organizational culture of the company and role of hero (CEO, Tony Fernande) who reshaped the
company and placed the company at prestigious positions in the aviation industry.
The organizational culture of Air Asia includes low fair and cost minimization
philosophy, values and empowerment for employees, organization symbols and logos, and
innovative and change adoptive strategies of the company. The bureaucrat organizational
structure also helped the company to reshaped and recreates the company in the international
aviation industry

Culture: Air Asia 12
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