Malaysia Airlines: The Marketing Challenge after MH370 and MH17 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Malaysia Airlines: The Marketing Challenge after MH370 and MH17
The chief executive officer of Malaysia Airlines (MAS) had the daunting task of sustaining a business that had suffered the tragic loss of two of its airliners in a span of just four months. Prior to this, a US$392 million loss, as well as the inability to compete with lower-cost carriers, had posed a great challenge to MAS. Management was planning to initiate a cost-cutting strategy to manage pricing and the competitive challenges of the aviation industry when these incidents shocked the world. The disasters greatly impacted customer confidence, as reflected in the company's declining booking rates and stock prices. With its reputation severely damaged, MAS was faced with many hard-hitting questions from various stakeholders about the airline's prospects. Many felt there was a need to transform the entire business model. The top executives pondered various options, including a rebrand of the airline, a new discounted pricing structure to build volume, a private equity infusion, a merger and filing for bankruptcy. Each option would have to be considered very carefully, as the changes made to the business would decide the future of MAS. Neeraj Pandey and Gaganpreet Singh are affiliated with National Institute of Industrial Engineering (NITIE).
Swot Analysis of "Malaysia Airlines: The Marketing Challenge after MH370 and MH17" written by Neeraj Pandey, Gaganpreet Singh includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mas Malaysia facing as an external strategic factors. Some of the topics covered in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study are - Strategic Management Strategies, Crisis management, Customers, Organizational culture and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Malaysia Airlines: The Marketing Challenge after MH370 and MH17 casestudy better are - – there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions,
supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Malaysia Airlines: The Marketing Challenge after MH370 and MH17
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mas Malaysia, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mas Malaysia operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Malaysia Airlines: The Marketing Challenge after MH370 and MH17 can be done for the following purposes –
1. Strategic planning using facts provided in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study
2. Improving business portfolio management of Mas Malaysia
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mas Malaysia
Strengths Malaysia Airlines: The Marketing Challenge after MH370 and MH17 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mas Malaysia in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 Harvard Business Review case study are -
Ability to recruit top talent
– Mas Malaysia is one of the leading recruiters in the industry. Managers in the Malaysia Airlines: The Marketing Challenge after MH370 and MH17 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Mas Malaysia is one of the most innovative firm in sector. Manager in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Mas Malaysia in the sector have low bargaining power. Malaysia Airlines: The Marketing Challenge after MH370 and MH17 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mas Malaysia to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Mas Malaysia is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Neeraj Pandey, Gaganpreet Singh can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management
– Mas Malaysia is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Mas Malaysia are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Mas Malaysia has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Mas Malaysia digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mas Malaysia has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High switching costs
– The high switching costs that Mas Malaysia has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Sustainable margins compare to other players in Sales & Marketing industry
– Malaysia Airlines: The Marketing Challenge after MH370 and MH17 firm has clearly differentiated products in the market place. This has enabled Mas Malaysia to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Mas Malaysia to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Mas Malaysia has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mas Malaysia has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Learning organization
- Mas Malaysia is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Mas Malaysia is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Malaysia Airlines: The Marketing Challenge after MH370 and MH17 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Malaysia Airlines: The Marketing Challenge after MH370 and MH17 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Malaysia Airlines: The Marketing Challenge after MH370 and MH17 are -
Interest costs
– Compare to the competition, Mas Malaysia has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High operating costs
– Compare to the competitors, firm in the HBR case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Mas Malaysia 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Mas Malaysia needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow to strategic competitive environment developments
– As Malaysia Airlines: The Marketing Challenge after MH370 and MH17 HBR case study mentions - Mas Malaysia takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17, it seems that the employees of Mas Malaysia don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Skills based hiring
– The stress on hiring functional specialists at Mas Malaysia has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mas Malaysia is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Mas Malaysia has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Malaysia Airlines: The Marketing Challenge after MH370 and MH17 should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Mas Malaysia is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Mas Malaysia needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mas Malaysia to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Malaysia Airlines: The Marketing Challenge after MH370 and MH17 can leverage the sales team experience to cultivate customer relationships as Mas Malaysia is planning to shift buying processes online.
Need for greater diversity
– Mas Malaysia has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Opportunities Malaysia Airlines: The Marketing Challenge after MH370 and MH17 | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 are -
Buying journey improvements
– Mas Malaysia can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Malaysia Airlines: The Marketing Challenge after MH370 and MH17 suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Loyalty marketing
– Mas Malaysia has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Manufacturing automation
– Mas Malaysia can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Developing new processes and practices
– Mas Malaysia can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Mas Malaysia can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mas Malaysia can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Mas Malaysia can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Creating value in data economy
– The success of analytics program of Mas Malaysia has opened avenues for new revenue streams for the organization in the industry. This can help Mas Malaysia to build a more holistic ecosystem as suggested in the Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study. Mas Malaysia can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Mas Malaysia can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mas Malaysia is facing challenges because of the dominance of functional experts in the organization. Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Mas Malaysia in the consumer business. Now Mas Malaysia can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mas Malaysia can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mas Malaysia can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mas Malaysia in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Threats Malaysia Airlines: The Marketing Challenge after MH370 and MH17 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mas Malaysia with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Mas Malaysia.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Consumer confidence and its impact on Mas Malaysia demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Mas Malaysia in the Sales & Marketing sector and impact the bottomline of the organization.
Increasing wage structure of Mas Malaysia
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Mas Malaysia.
Shortening product life cycle
– it is one of the major threat that Mas Malaysia is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17, Mas Malaysia may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mas Malaysia in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Mas Malaysia will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology acceleration in Forth Industrial Revolution
– Mas Malaysia has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Mas Malaysia needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Mas Malaysia business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mas Malaysia can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 .
Weighted SWOT Analysis of Malaysia Airlines: The Marketing Challenge after MH370 and MH17 Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Malaysia Airlines: The Marketing Challenge after MH370 and MH17 is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Malaysia Airlines: The Marketing Challenge after MH370 and MH17 is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Mas Malaysia needs to make to build a sustainable competitive advantage.
