Introduction

AirAsia originally was founded by government and on 2 December 2001 was bought byTony
Fernandes. AirAsia was established in year 1993. AirAsia has travel around the earthand
ascend to become the worlds best in year 2001. AirAsia continues to spread out the way
for low-cost aviation through the innovation, efficient and passionate approach to businesswith a
route a network that extent through over 20 countries. There are some companieswhich link with
AirAsia such as AirAsia X, Tha
i AirAsia, Philippines AirAsi
a Inc., AirAsiaJapan and Indonesia.In addition, for the vision part in AirAsia, AirAsia aims to be
the largest low cost airlinein Asia and serving the 3 billion people who are currently underserved
with poor connectivityand high fares. While for the mission of AirAsia, AirAsia wants to be the
best airlinecompany to work whereby employees are treated as part of the big family. Besides,
AirAsiatry to maintain the lowest cost hence everyone can fly with AirAsia. Highest quality
product,embracing technology to lower the cost and improvement in service levels will be
maintained by the AirAsia airline also. Lastly, create a globally recognized ASEAN brand will
be themission part of AirAsia.In the values part, AirAsia will implement trough the following
key strategies which are:


Safety


Low fare, no frills


Lean distribution system


Point to point network


High aircraft utilization


Streamline operationThe loyalty programmed
of AirAsia will be BIG. BIG was known
as the kind global programmed
where can earn BIG Points to redeem free airline flight.
Members can enjoythe preference booking, special offers and discount as an AirAsia BIG
dedication member interm and condition apply. (AirAsia, 2013)

The University Of Sunderland BABM
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UGB202 Introduction To Strategic Management
2.0

Strategic Analysis
Strategy analysis was known as the process of developing strategy for business bysearching the
business and environment in which it operates. (BusinessDictionary, 2013)

2.1

PEST analysisPEST will be the type of situation analysis in political, economic, socio-cultural
and
technological factors are investigate to chart of an organizations long
-term plans.(BusinessDictionary, 2013)In the political part, AirAsia found that it is difficult to fly
outside the Malaysia.Double-sided agreement will be the main barriers in the way of low cost
carriers. The landingcharges will also be another big factor which influence on costing of low
fare airlines.Besides, the low cost airline industry which situated in South East Asia has
beenunderdeveloped just because the aviation market is tightly adjusted by bilateral air
rightscontract.While in the economic part, AirAsia airline offers the low-cost carriers by
providinginexpensive ticket and few in flight services. These may help in obtaining the attraction
in thedistrict despite having the strong competition from MAS (Malaysia Airline). For the
currentdepression will hit on the aviation business. With the slow down economy, more people
willwant to buy the cheap tickets and enjoy the flight. Besides, the prices of the oil may be
another factor for the airlines. It is difficult to control the operations cost once the pri
ce of the oil increasing.For the social part, passengers are not willing to take the expensive airline
for a long-haul flight.
To help for the worlds population increasing, the numbers of tourist and educated
person are needed as help for increasing the growth of aviation industry. SARS had scare
people to fly over. Safety First was committed by the AirA
sia, implement with allregulatory institutions, set and maintain constantly high standards and the
last will beguarantee the security of staff and guests.


The University Of Sunderland BABM
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UGB202 Introduction To Strategic Management
While in the technology part, AirAsia provides the online service which can combinesthe air
ticketing with hotel bookings, car hire and travel insurance. AirAsia had pushed theinternet
booking services in order to keep costs in check. Besides, AirAsia also introducingthe GO
holiday, the online programmed where consumers can book the holiday packageonline in real
time. With the airbus A320, there will be better performance and reliability ashelp in proving the
fuel efficiency and extra capacity. (UK Essay, 2013)2.2

Porter 5 forcesPorter 5 forces are a model which used by the company for industry analysis
andcorporate strategy development. This 5 forces include supplier strength,
competition,customer power, the potential for new companies join the industry and threat of
substitute products (BusinessDictionary, 2013)Figure 1: Porter 5 Forces diagram