In Search of Excellence

"In Search of Excellence"

Assignment 1

Dharshviny Sasidharan

SCM-006798

Introduction

"Excellence is in the details. Give attention to the details and excellence will come." (Perry Paxton, n.d.) Excellence is the goal of every man on the face of earth. Some find excellence in building a reputable name in society and some find excellence through academics. However, remarkable it is when some people turn their entire life searching for excellence through businesses and organizations. These people make up the leaders in our society. Their success story is known to everyone and even becomes inspiration to some. Success to them however, never came rolling. Creating an organization that is able to function smoothly as well as profitable needs a strong foundation, clear strategies, efficient management style as well as values that will uphold the company's name. Even so, in today's world, excellent companies keep merging everywhere and their secret to success is definitely to have a management style that becomes a guideline to the companies. One such management strategy that is worth mentioning will be the Mckinsey's 7S framework. This framework consists of seven elements namely strategy, structure, systems, style, staff, skills, shared values, or also known as super ordinate goals. Most successful organization is at least made up of one of the S's. This paper will look at some of the most successful organizations known to people which operate by at least one of the elements in the Mckinsey's framework. Some of the companies are AirAsia, HP, Intel, Toyota, Honda, and Starbucks.

1.0 AirAsia: A Brief History

Every man goes in search for excellence and none opts for the otherwise. However, one man made the difference when he bought over the now world's best low-cost airline for merely RM 1 (US$ 0.26). The history of AirAsia begun when TuneAir bought it over in year 2001 with only two aircrafts and RM40 million in debt. In 2002, AirAsia became the first airline to introduce online booking services to customers who wished to book their tickets and one year after that SMS booking was introduced. Within three years of introduction into the airlines business, in year 2004, AirAsia was awarded the Asia Pacific Airline title by the Centre of Asia Pacific Aviation. Finally, in the year 2009, AirAsia wins the 'World's Best Low-Cost Airline' title awarded by Skytrax. (Have You Flown AirAsia, n.d.). Currently, AirAsia is still growing rapidly bagging titles and awards, beating other dominant airlines like the Arab Emirates and Singapore Airlines and making a huge name in the airlines business. The idea of buying over an existing heavily in-debt airline that ridiculed many at that point of time now has proven itself, but the secret to it's success very much lies on the way Dato Seri Tony Fernandez brought AirAsia up from scratch. Mention AirAsia now to Malaysians even Asians for that matter, all they think of is its famous tagline, "Now Everyone Can Fly." The tagline truly suits AirAsia since statistics have shown that before its existence; only 6% of Malaysians have ever travelled via air. (Tony Fernandes Legion D' Honneur, 2000). It is in no doubt that, the success of AirAsia is due to its well-built foundation; its clear strategies, excellent culture, values, and management style, which are observed by both the employees and employers.

1.1 The AirAsia Backbone: It's Strategy

"A man who does not plan long ahead will find trouble right at his door." (Confucius, n.d) Strategy in an organization is a vital part for its growth. Without a strategy, a company's success is at stake. The strategy used in AirAsia is very simple and straightforward. It consists of four main pillars, which are safety, low fare, service, and simplicity. Maintaining the 'safety first' attitude in this company sees AirAsia collaborating with huge names such as GE Engine Services Malaysia (GEES),a 50 year old company which services jet aircraft engines as well as a leading manufacturer of large and small jet engines for commercial and military airplane also engines for industrial applications and marine. In addition to that, GEES leads in providing integrated engine maintenance services. The five-year deal made in year 2002 looks at AirAsia spending a sum of 20 million USD in order to provide excellent safety features to customers as well as to ensure that they are accident free. (Press Release, 2002).The next strategy emphasized in AirAsia is their low fare, no frills concept. According to Merriam Webster Online Dictionary (n.d.), the definition of 'no-frills' is to offer or provide only the essentials, not fancy, elaborate, or luxurious. AirAsia believes in getting their customers from point A to point B in a short time. Hence, it exercises removing a few frills within its airline in order to make it more affordable for everyone. Amongst the things that AirAsia has put aside to fulfill their low-fare strategy are, no free food and beverages, free seating, ticketless airlines, no refund and no loyalty program. AirAsia welcomes passengers to customize the way they fly by enabling customers to purchase food and beverages, comfort kits and many more from the cabin crew only if they need it. Implying ticketless airlines also saves customers from the hassle of collecting tickets before the flight as well as saves the cost used for paper, printing, and distributing.

Simplicity is the third strategy used in AirAsia. Simplicity in this company is defined in a unique manner. Two of the obvious practice that AirAsia does is to standardize the systems and equipments as well as simplifying its booking process. In order to efficiently handle the aircrafts and make it easier for their employees, AirAsia make every effort to have the same type of aircrafts. It is currently replacing all its old models with the new Airbus 300 models. (Idris, n.d) This results in a simple way of handling and providing maintenance for the aircrafts as well as making the training process for pilots and cabin crews a much easier one. Apart from that, AirAsia's simplicity is also implemented in terms of booking tickets. According to HaveyouflownAirAsia.com (n.d), AirAsia was the pioneer in online booking of tickets. A 3-step procedure was created to give customers a hassle free process of booking tickets. All one needs to do is; book, pay and fly! Since this approach relies heavily on technology, AirAsia went on in becoming