Innovative Ideas for MAS!

[Lawrence L 0]

They cant even compete with no-frill low cost airline, airasia, how are they going to compete with the likes of SQ, EK...???

 

 

 

[KK Lee 5]

 

 

Old habit died hard, there are still too many dead wood in Mana Ada System especially at the top management level. Basically, these people don’t have a grip on business sense but politic. Modern business model will not be implemented in the foreseeable future.

 

To have a truly competitive and successful airline in Malaysia; believe it is easier and cheaper to close, dissolve Mas and restart with a new airline. Of course, this is politically unacceptable. Hence, most of us in this forum will forever cry for improvement or give up hope eventually.

 

Just my 2 cents.

 

 

[Lawrence L 0]

Maybe another way is "penswastaan" or in simple english means make Mas a wholly private company without any interference from goverment...

 

I wonder how Petronas can become such a strong company (Ranked top 6 oil supplier in the world) and they even "give" money to the goverment annually...

[KK Lee 5]

Maybe another way is "penswastaan" or in simple english means make Mas a wholly private company without any interference from goverment...

 

I wonder how Petronas can become such a strong company (Ranked top 6 oil supplier in the world) and they even "give" money to the goverment annually...

 

Petronas has been operating as PM’s private company. No other politician can lay their hand on Petronas business.

 

Despites many ‘national service’ carried by Petronas, Petronas is still very rich.

 

If Petronas keeps to its charter ‘to manage the earning from oil and gas for future generations’; Malaysians shouldn’t be paying income tax.

 

 

[Lawrence L 0]

Petronas has been operating as PM’s private company. No other politician can lay their hand on Petronas business.

 

Despites many ‘national service’ carried by Petronas, Petronas is still very rich.

 

If Petronas keeps to its charter ‘to manage the earning from oil and gas for future generations’; Malaysians shouldn’t be paying income tax.

 

What does the bold sentence mean ?

[KK Lee 5]

What does the bold sentence mean ?

 

Invest for the future when oil and gas reserve is depleted.

 

 

[BC Tam 2]

What is with the fixation on competing with SQ? SQ does not even consider MH a viable competitor.

 

Seriously, there is some terrible inferiority complex going on around here.

I am of opinion this "fixation" has been, and is, one of the most important impetus for Malaysians to improve over the years. Whether we have suceeded or not would be a topic for debate

 

As for the "inferiority complex" bit, view it positively in context of humility being a virtue

[S V Choong 4]

Precisely I don't see a point of this thread. It does not serve any useful purpose.

[Sandeep G 1]

What is with the fixation on competing with SQ? SQ does not even consider MH a viable competitor.

 

Seriously, there is some terrible inferiority complex going on around here.

 

 

Historically, the carriers were rivals. There was a time, when MAS was the dominant carrier and offered the better product. Yes, indeed nowadays, SQ does not consider MH a competitor - as it is, quite rightly, out of their league..

 

But that, in my opinion, doesn't mean you don't compete. And I'm not asking for SQ to compete with MH, I'm asking for MH to compete with SQ... competition allows for there to be pure black and white goals - something MH needs to bring back the golden days of yesteryear.

 

On that note, competition does not mean competing on just product and services - it's the entire operation. Reliability, Financials, Employee productivity etc etc etc.

 

MH definately does not have the money to implement expensive new cabin modifications - not immediately. There is more overhauling needed up top before that ever happens, and straightening out the balance sheet too - the MOST important part of the BTP and any restructuring exercise.

 

What this thread is supposed to ask for are cost-effective, easy to implement innovative ideas that will spur on future growth for the airline. We can debate till we are black and blue in the face over what MH really needs, and we'll never get anywhere.. Let's just lay our cards out on the table, and see what happens

 

Finally, no inferiority complex here. We just want to achieve and maintan the best and highest level standards. ain't nothing wrong with that.

[Andrew Ong 1]

I agree; MH and SQ are not competitors because they codeshare with each other

[Isaac 0]

I agree; MH and SQ are not competitors because they codeshare with each other

 

[S V Choong 4]

Historically, the carriers were rivals. There was a time, when MAS was the dominant carrier and offered the better product.

 

AFAIK, MAS had only managed to catch up but was not in any way the 'dominant' carrier as you put it. Could you elaborate?

[Sandeep G 1]

Hi SV,

 

well at one stage, the Australian market was dominated by MAS, and it wasn't too long ago. SIA has always been profitable yes, no doubting that - but the two carriers were quite (and I use that term very loosely) close in terms of the gap that seperated them. Now, SIA has leapt well ahead of MAS, and well, maybe it's a blessing in disguise or maybe its the opposite - who knows. Yes, during the split of MSA, SIA got most of the benefits including the intl fleet, but MAS was driven by the pursuit of achieving the best by itself, and brought itself back alongside SIA in not too long a time.

 

I speak with many elders who flew MAS many times in the 70s and the 80s and early 90s and ALL tell me that MAS was a great carrier - it was the SIA of yesteryear.. now.. well, need I say more.

 

But SV, I just want to clarify with you that the point of this thread is not so much as to say oh yes, SIA has this, so WE must have it too.. it's completely the opposite.. let's think outside the box... No-one is obliged to write ideas here.. it's literally a hypothetical type scenario. We have lots of young members oozing with ideas... Some may be a little far-fetched, but some may be brilliant ideas! I thought it would be nice to see what sort of creations or ideas people may come up with. That's all.

[S V Choong 4]

Thanks for the elaboration Sandeep.

 

AFAIK, during the split of SIA and MAS, the reason why SIA took most of the good fleet away was, I believe, funded by the Singapore government. I think one is the majority shareholder and the other one a minority. It is rather normal for a company to reclaim their share of the asset.

 

Don't forget during those days, KL was really under-developed compared to Singapore, the colonialist's headquarters I believe. I had a look at Air NZ history and Auckland Airport history the other day and found that the first DC-8 service to Singapore initiated in 1965, which was before the establishment of MSA. What that tells us is, Singapore was much more important than KL. Being the federal capital does not necessarily mean being the most important city. Just look at the capital of NZ, Australia and the USA, they are far less important than say, Auckland, Sydney and New York economically. From my understanding of what I read in MWings and ArrogantMalaysia is that we Malaysian by default have taken the situation today, which is KL being the most important city in Malaysia and attempted to re-read history in that way and that MSA should have flown out from KL rather than directing all international traffic to Singapore. Where's our understanding of the demand and supply curve in relation to that particular period of time? More than often, some of us tended to bring SQ and MH issues in the disguise of some racially related ideas or displeasure over one or the other, which is rather unfortunate.

 

I speak with many elders who flew MAS many times in the 70s and the 80s and early 90s and ALL tell me that MAS was a great carrier - it was the SIA of yesteryear.. now.. well, need I say more.

 

In contrast to this, I have always been hearing a lot of passenger (especially the ethnic Chinese groups) who always claim that SQ is a far better airline.

 

And really at the end of the day, everything goes back to commercial viability and the decision of a certain group of people. For me, MAS is just another company. Whether MAS is making profit or not, I won't get a cent and when if they are brankrupted I won't have to pay a cent (may be thru income tax). A lot of us are only emotionally tied to MAS.

 

I mean I appreciate your courage and patience to write your opinion here. Everyone has their view, but be prepared to be challenged by other people.

Edited October 23, 2006 by S V Choong

[Sandeep G 1]

Thanks for the elaboration Sandeep.

 

I mean I appreciate your courage and patience to write your opinion here. Everyone has their view, but be prepared to be challenged by other people.

 

 

SV, thank you Sir for your reply.

 

Never once doubted that people have differing views I hope you didn't feel I wasn't being open to your ideas, when actually I was my apologies if that was the case.

[Lawrence L 0]

I speak with many elders who flew MAS many times in the 70s and the 80s and early 90s and ALL tell me that MAS was a great carrier - it was the SIA of yesteryear.. now.. well, need I say more.

 

Beauty is on the eyes of the beholder...

[KC Sim 2]

I would like to add to remarks by SV Choong:

 

About the split of routes and assets between SIA and MAS after the split of MSA.

 

From what I read in those days, the split was precipitated to a large extent by the different directions both governments were taking. Malaysia was keen on growing regionally while Singapore was keen on a more international approach to growth. So when it came to the actual split, SIA inherited the international fleet and traffic rights while MAS gained a more regional fleet. Both governments had then agreed on a formula to even out the value of these using cash compensations. It is clear that the cash compensations went north from Singapore to take into account the higher value of SIA's tangible gains. What proved to be of greater value than expected were the traffic rights SIA gained. These allowed for quick and explosive growth to Europe.

 

About Singapore importance as the "Colonial Headquarters".

 

Singapore's importance on the Kangaroo Route (as well as it being Air NZ's choice of DC-8 service) were almost solely attributed to its geographical location as well as the level of entrepot trade that was already in place. It was the meeting point where Arab and European traders could meet with Chinese and Southeast Asian traders to barter and sell. For colonial prominence, Singapore certainly was no more so than Penang. Singapore was the one convenient place where Imperial Airways services could dovetail with Qantas Empire Airways services to allow passengers a seamless journey from Australia to the UK and vice versa. This you might say is one of the pioneer of what is today known as "code-share services". If colonial prominence is indeed what drives air services, then India's growth as an aviation hub would have happened long ago. Much of the empire's assets in SE Asia were indeed ruled and managed from India.

 

One of the pioneer air operators into Singapore was KLM . . . SIN then was a stopover on its AMS-Batavia (now Jakarta) route. SIN was certainly not a Dutch colony. In essence, what I am trying to say is air services were drawn to where trade was flourishing as well as where geographical location is favourable. The epicentre of trade in those days had shifted across a wide band of cities, ranging from Penang and Malacca to Bengkulu in Sumatra.

 

In all these discussions, we have ignored one issue. It is not that MAS is not filling up her aircraft. It is not that MAS is not offering an attractive-enough service (quite the contrary). It is about MAS not getting the right yield for the services it is giving. MAS had at some point in its development taken the strategic move to compete on fares (meaning that it chose to rely on lower fares to fill up her aircraft). It is easy enough to lower fares but when the time comes to raise fares and improve yield, it is one of the most difficult thing to do. Any marketer can attest to that. This is a double whammy for Malaysia . . . because MAS has driven yield so low, other major airlines are not finding it attractive enough to fly to KUL. Their aircraft and services will deliver far better returns operating to another port (not necessarily in this region). This in turn has a dampening effect on demand for MAS regional services. MAS' decision for a long time not to go into any alliance has certainly exacerbated this situation . . . resulting in Kuala Lumpur's reduced likelihood of gaining a major hub status.

 

Some years ago, I recall a fare comparison what I found to be stark and almost shocking. SIA's economy class fares to London was constantly in the S$1500 range. Kuwait Airways was offering S$800 return to London from Singapore . . . shocking right? I nearly lost my eye-balls when I saw the MAS advertisments for SIN-JFK via KUL and DXB for S$800. This is a shocking illustration of the kind of yield that airlines get beneath the seemingly positive atmosphere of a full flight.

 

One thing for sure is: It does not matter where SIA is today. It only matters for us to mull over how MAS could realise it true and fullest potential. It is inately a very good airline . . . it just has to be very resolute in implementing the many bitter actions prescribed in the Business Turnaround Plan. Remember that it wasn't too long ago when BA and QF were highly protected and made huge losses. Look at both of them today . . . they are some of the most profitable and efficient airlines too, and this happened in a most competitive environment. Solving huge problems require hard decisions . . . and sticking to them. The growing affluence and sophistication of Malaysian travellers is the foundation for MAS' and KLIA's future.

 

The prospects are bright indeed. Regarding comments about PAL's current profitable operations and fleet growth, we must also remember that in the 1960s, PAL was a leader in SE Asian aviation. It was the region's first trans-Pacific operator. In the 1970s and 1980s, Thai Airways International was the market leader.

 

KC Sim

 

 

[S V Choong 4]

Very well said KC Sim.

 

It is about MAS not getting the right yield for the services it is giving. MAS had at some point in its development taken the strategic move to compete on fares (meaning that it chose to rely on lower fares to fill up her aircraft). It is easy enough to lower fares but when the time comes to raise fares and improve yield, it is one of the most difficult thing to do. Any marketer can attest to that. This is a double whammy for Malaysia . . . because MAS has driven yield so low, other major airlines are not finding it attractive enough to fly to KUL. Their aircraft and services will deliver far better returns operating to another port (not necessarily in this region). This in turn has a dampening effect on demand for MAS regional services. MAS' decision for a long time not to go into any alliance has certainly exacerbated this situation . . . resulting in Kuala Lumpur's reduced likelihood of gaining a major hub status.

 

I was talking to one of my friend who is a practising dentist in New Zealand today. He actually charges his patients more than what an average dentist would charge for. He is doing well and most of all, he is good and he has a strong patient load. People keep coming back to him.

 

One funny thing is, the in-law parents who happens to have a Chinese/Asian mindset thinks he is charging a lot and thought he could do better by lowering his charge rate in order to be more competitive and they thought by doing so will gain him and even more number of patients. I would say this kind of mindset is old fashion. If you are good, you should value yourself. Same situation as MAS, we know that MAS is good and much better than they charge for. If MAS is to win by low fares, then at the same time they have set themselve as a cheap rather than a premier brand.

 

This is probably not a good way to do business and the reason why we see many Chinese stuff and food outlets are way more cheaper than European food. That mindset has to change.

[Keith T 2]

because MAS has driven yield so low, other major airlines are not finding it attractive enough to fly to KUL. Their aircraft and services will deliver far better returns operating to another port (not necessarily in this region).

 

My friend working for BA said something to that effect to explain why BA (and similarly QF, NH etc) left KUL. Airlines were forced to lower their fares (and hence yields) to attract people on to their KUL flights in order to match MH, to the point where KUL became unviable. The low yield KUL flights were also starting to cannibalise the higher yield flights to SIN as travel agents started to issue tickets to/from KUL to take advantage of the cheap fares when pax were really flying to SIN. That was also in the days when travel agents were able to issue ex-KUL fares for an ex-SIN departure, and travellers were told to disregard to KUL-SIN-KUL sectors on their tickets and accepted for check in at SIN. Nowadays this would be against fare rules and subject to auto CRS cancellation of the entire itinerary upon missing ur first flight (KUL-SIN in this case) or the check in agents would just refuse to issue you a BP in SIN.

 

Remember that it wasn't too long ago when BA and QF were highly protected and made huge losses. Look at both of them today . . . they are some of the most profitable and efficient airlines too, and this happened in a most competitive environment.

 

BA was so close to bankruptcy that airline analysts and armchair CEOs everywhere were counting the days to its demise. As I recall, the airline was third in line to become insolvent after the collapses of Sabena and Swissair. While the BA today still has some debt to pay off, it has regained its position as one of the leading airlines in the world. An interesting parallel can be drawn between BA's story and MH's. The determination to reform and swallow some bitter pills is required and in this regard, BA provides an excellent model for carriers in MH's position.

Edited October 23, 2006 by Keith T

[Guest Michael]

Yes very good ideas I like them all actually, but MAS is still sorting out its problems so just have to wait and see what the management does.