Importance of PESTEL Analysis in Strategy Management & Planning Process Strategy planning process often requires five steps - 1. Please refer to the Terms and Conditions and Disclaimer for usage guidelines. The number of passengers may decrease while the cost of raw materials may increase. But often in emerging countries these agencies delay the process as a tactic to extract bribes. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. The prudent policy should be to take insurance and other types of hedging instruments to mitigate the losses occurring because of the terrorist attacks. With EdrawMax Online, you can create over 280 types of diagrams, charts, and visuals. In highly hierarchical societies the power of decision making often reside at the top. The rules help to protect the environment and to ensure the safety of the passengers. Free Summary Report This report contains the table contents only. SpendEdge. Malaysia Competition Commission regulates market-sharing prohibitions, 1. Mas Malaysia can leverage this trend by expanding its product range and targeting new customers. The growth and success of any organization depends on its employees. I have used them in a lot of my personal research work.-Mudassir KhanAccounting and Business, Melbourne Polytechnic, Here the research is to-the-point, no beating round the bush. The airline has received various awards for its premium and high-quality services. Copyright 2023. The manpower in hotels in the form of trainees from hotel management institutes plays a major role in the operations in the hotels. Attitude towards immigration has come under sharp focus. Pestle analysis of Malaysia. Environmental, Social, and Governance (ESG) Analysis Report. - Integration of Technology into Society & Business Processes Uber failed in China because it tried to enter before smartphone were widespread in China. PESTLE The SWOT analysis of Air Asia is presented below: Sample Complete Report This is the sample complete report which will give you a glimpse of what your complete report will cover after purchase. Often companies enter the arena without requisite infrastructure to support the technology oriented model. To maximize their effectiveness, color cases should be printed in color.In the first six weeks on the job, the new CEO of Malaysia Airlines (MAS), has developed an ambitious turnaround plan, including aggressive job cuts and route eliminations, but MAS's largest shareholder, Khazanah Nacional, the sovereign wealth fund, is tasked with helping to grow the Malaysian economy. If you want to know more about how to make a PESTEL analysis diagram in EdrawMax Online, just check this PESTEL guide, it may help you to create diagrams without efforts. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. The airline which has been recently renamed as Malaysia Airline Berhad and operates flights to Asia, Australasia, Africa, the Americas, Europe, and the Middle East. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. Analyze Strengths and Weaknesses of Khazanah Mas's. Analyze the Khazanah Mas's external competitive environment to identify opportunities and threats. Malaysia Airlines (A) case study (referred as Khazanah Mas's for purpose of this article) is a Harvard Business School (HBR) case study covering topics such as Finance & Accounting and strategic management. Execution of the strategy and building a feedback loop, using which managers at Khazanah Mas's can fine tune processes and strategies going forward. The whole world is connected via airlines. It should evaluate the e-commerce infrastructure, technology infrastructure etc before entering a new market. The PESTEL analysis airline industry can help them to have an idea about those conditions. 1. 4. - Influence of Climate Change How climate change will impact Mas Malaysia business model and supply chain. Malaysia Airline System (MAS) is one of the Government Linked Companies in Malaysia. Strengthening of democratic institution will foster greater transparency and reduce the level of corruption in the country. PESTEL analysis airline industry can show how legal issues can impact their business: The PESTEL analysis airline industry shows how the business has a broad scope for growth with a few minor negative issues. Here are some sociological conditions which can impact the airline industry: The airline industrys technology is intricately related to its growth. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. PESTEL / PEST / STEP Analysis & Solution, HyundaiCard's Marketing Strategy PESTEL / PEST / STEP Analysis & Solution, IDS Financial Services (Condensed), Spanish Version PESTEL / PEST / STEP Analysis & Solution, Capital One: Leveraging Information-Based Marketing PESTEL / PEST / STEP Analysis & Solution, Delhi Metro Rail Corporation (B): Doing More with Less PESTEL / PEST / STEP Analysis & Solution, WestJet: A New Social Media Strategy PESTEL / PEST / STEP Analysis & Solution, Eco7: Launching a New Motor Oil PESTEL / PEST / STEP Analysis & Solution, Airbnb, Etsy, Uber: Acquiring the First Thousand Customers PESTEL / PEST / STEP Analysis & Solution, InMobi: Reimagining Mobile Advertising PESTEL / PEST / STEP Analysis & Solution, Malaysia Airlines: The Marketing Challenge after MH370 and MH17. Therefore, it is a threat for Air Asia Berhad. Definition of PESTEL / PEST / STEP Analysis. Malaysia Airlines (A) case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. A keen eye on the security of passengers and technical superiority can help the airline industry concerning their business expansion. - Unrest within the Country & Chances of Civil Unrest We dont think that Khazanah Mas's business operations are facing any dangers from any kind of civil unrest or internal militant operations in the country. - Corporate Social Responsibilities Culture Are Mas Malaysia present CSR efforts applicable in the new market or does it needs to have new initiative to cater to the prospective market. - Transparency in Judiciary System & Processes Transparency is essential for fair and consistent decision making. - Size of Government Budgets both Local Governments and National Government The government at both national level and local levels are running deficit budgets which is boosting growth in the short term but may lead to increase in inflation over medium term. This section is available only in the 'Complete Report' on purchase. MAGs sustainability program will contribute towards the SDGs for aviation carbon and GHG emission reduction, fuel conservation and climate change. - Transparency & Digital Drive Mas Malaysia can use digitalization of various processes to overcome corruption in the local economy. The BP Healthcare and Enrich by Malaysia Airlines partnership cares for all Malaysians wellbeing - https://www.malaysiakini.com/announcement/568903, 3. Available at: https://www.managementstudyguide.com/pestle-analysis-of-global-aviation-industry.html (Accessed 16 June 2021). If the legal system is not strong then Mas Malaysia can face numerous challenges from consumer petitions to shakedowns from authorities. It can enable Mas Malaysia to hire skilled workforce at competitive salaries. Malaysia Airlines reported a Net Loss of Tax of RM433 million in 2012 compared to a Net Loss of RM2.52 billion registered for the 12 months ended 31 December 2011. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. Malaysia, is a federal constitutional monarchy in Asia. - Environmental Standards and Regulations both at National & Local Levels Often the environment policy at national and local level can be different. The period in which amnesties were applied covers the years between 2012 and 2014. For example as the population of USA and EU is growing old the demand for products mostly catering to this segment will grow. - Demographic Trend The demographic trend is one of the key factors in demand forecasting of an economy. 1. There is consistency in both policy making and implementations of those policies. Although plenty of airlines are currently operating in the industry, there are . Digital Marketing and Social Media Strategy Analysis Report. 'PESTLE Analysis of Airline Industry | Marketing Tutor', Marketing Tutor, [online]. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. Khazanah Mas's can make strategies based on the stable political environment. International Journal of Business Economics and Management Research, HUMAN RESOURCE PRACTICES IN INDIAN HOTELS: A STUDY OF BUSINESS & OTHER HOTELS IN DELHI (NCR, THE EXTERNAL ENVIRONMENT AND ITS EFFECT ON STRATEGIC MARKETING PLANNING: A CASE OF STARBUCKS MALAYSIA, BUILDING HIGH PERFORMANCE TEAMS-A TQM APPROACH AT BHEL, HYDERABAD, RISK OF OBSOLESCENCE OF SYSTEM IN INDIAN BANKS, MAKE IN INDIA BIG BOOST TO TOURISM AND HOSPITALITY, EMPLOYEES PERCEPTION TOWARDS ORGANISATIONS DEVELOPMENT PRACTICES- A STUDY OF INDIAN FIVE STAR HOTELS, STRATEGY AND 'STRUCTURE' WHICH COMES FIRST, STUDY OF FACTORS AFFECTING ENTREPRENEURIAL INCLINATION AMONG UNIVERSITY STUDENTS, THE IMPACT OF AMNESTIES ON NON-PERFORMING LOANS IN NORTHERN CYPRUS, EFFECT OF MANUFACTURING PLANNING OBJECTIVES AND CONTROL SYSTEMS OF MULTINATIONAL ENTERPRISES IN NIGERIA, EFFECT OF MANUFACTURING PLANNING OBJECTIVES AND CONTROL SYSTEMS OF STEP 5: PESTEL/ PEST Analysis of Malaysia Airlines Case Solution: Pest analyses is a widely used tool to analyze the Political, Economic, Socio-cultural, Technological, Environmental and legal situations which can provide great and new opportunities to the company as well as these factors can also threat the company, to be dangerous in future. What are the PESTLE insights for Malaysia? Contributor, P., 2021. Mas Malaysia has stringent norms for health and safety norms so in emerging economies it may have to compete with players who dont have high cost structures that of Mas Malaysia. 2.0 Background of SIA It all began in 1947 when Malayan Airways started having scheduled . Attracting the talented employees is not a problem with IT Industry but to retain employees is the biggest challenge. Tourism industry is such a money earner industry that it has the potential to generate foreign exchange and also to make a very active contribution towards growth of overall economy and creation of employment opportunities. Despite increasing levels of airborne passenger and cargo traffic, revenue for the global airlines industry has grown sluggishly over the past five years as unstable fuel prices and rising competition have set downward pressure on airline ticket prices and freight shipping rates, restraining industry revenue growth . However, the factors like association with entrepreneurship related activities at university level, parents' encouragement and role models from business community are significant in motivating the students towards starting their own business. They may get stuck in legal proceedings. - Political Governance System Based on the information provided in the Malaysia Airlines: The Marketing Challenge after MH370 and MH17 case study, it seems that the country have a stable political system. - Unrest within the Country & Chances of Civil Unrest We dont think that Mas Malaysia business operations are facing any dangers from any kind of civil unrest or internal militant operations in the country. Holistic Analysis Promoting entrepreneurship in society is one well accepted mechanism to generate employment which has potential to cater to the said problem. - Employment Laws What are the employment laws in the country and are they consistent with the business model of Khazanah Mas's. Available at: https://www.spendedge.com/casestudy/pestle-analysis-of-airline-industry (Accessed 21 June 2021). For example most of EU countries now want the EU citizen data to be saved in EU countries only. The capital of Malaysia is Kuala Lumpur. An external environmental analysis has been conducted to examine the environment in which the company operates. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Khazanah Mas's shouldnt be worried about the monopoly and restrictive trade practices law. The airline companies, which operate in countries with political turmoil, may see a sharp decline in revenue. The recent era of economic depression shook all industries and airlines' industry was no exception. Malaysia Airlines Berhad SWOT and PESTLE analysis has been conducted by Muskan Arya and reviewed by senior analysts from Barakaat Consulting. - Mobile Phone & Internet Penetration Khazanah Mas's should assess the level of internet and mobile phone penetration in the country as it will it in building a requisite business model based on local needs and realities. 3. Subsidiaries, Partnerships and Collaborations Report. Some of the economic factors that Mas Malaysia should evaluate both in the present market and one in which it wants to enter are inflation rate, GDP growth rate, disposable income level etc. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. MAB joined one world in 2013, and after joining it the company began to offer the best connectivity with world-class journeys to over 1000 destinations across 150 countries and access to approximately 650 airport lounges globally. We do not share your information with anyone. 1. - Level of Acceptance of Technology in the Society Mas Malaysia has to figure out the level of technology acceptance in the society before launching new products. This report is shared in order to give you an idea of what the complete Technology Landscape and Outlook Report will cover after purchase. 'PESTLE Analysis of the Global Aviation Industry', PESTLE Analysis, [online]. SWOT & PESTLE.com (2023). The study focuses on employee retention, various factors that affect employee retention and different employee retention strategies adopted by the IT industry. Are you looking for a report which is not covered on our website? Everything in desktop + Templates Community, Join 2023 Edraw Special Sales. The transition of government and change in policy: the political transition in Malaysia has a very systematic process that is . It's still running with the name of Air India. - Work Force Productivity Work force productivity in US has grown by 25-30 % in last two decades even though the salaries are not reflecting those gains. There are massive PESTEL templates and symbols to choose from, and creating a PESTEL analysis diagram could be really simple. 1190 Words; 5 Pages; Decent Essays. - Independence of Judiciary and Relative Influence of Government The judiciary independence often reflect both strength and credibility of the institutions in the country. Though the number of passengers has increased over the years, most airline companies failed to see a surge in their revenue. This report is shared in order to give you an idea of what the complete BCG Analysis Report will cover after purchase. PESTEL analysis airline industry can show how technical issues can work upon the growth of the airline industry: The significant environmental factor that has been a concern for environmentalists is its CFC emission. We invest deep in order to bring you insightful research which can add tangible value to your business or academic goals, at such affordable pricing. - Threat of Terrorist Attacks We believe in the world of post 9/11, corporations such as Mas Malaysia have to live with operating under the shadow of a terrorist attack. The airline companies are all about hospitality and services. Analyze the Mas Malaysia external competitive environment to identify opportunities and threats. and its background in Malaysia, and a PESTEL analysis and Porter's Five Force analysis will also be included in this written assignment. Apart from operating from its home base, Kuala Lumpur International Airport, the company operates in Europe, the Middle East, Australasia, North and South Asia, and Southeast Asia. Hence, an airline must have a good reputation. Should Khazanah encourage job and route cuts at MAS, and how would the government react to them? Top Quality. do not influence undergraduate students to opt for entrepreneurship. 2. It may lead the companies to lower their prices, and as a result, thousands can lose their job. - GDP Trend & Rate of Economic Growth The higher GDP growth rate signals growing demand in the economy. This is in addition to taxiing the aircraft with one engine instead of two after landing, which can further save as much as 50KG of fuel or 158KG of carbon dioxide per flight. At EMBA PRO, Legal factors often govern conditions to enter the market, laws to operate in the market, and procedure to resolve any dispute with other stakeholders. Airlines are reducing their carbon emissions in response to climate change risks: Malaysia Airlines has promoted efforts in reduction of carbon emissions through initiatives such as CORSIA, Carbon Offsetting and Reduction Scheme for International Aviation set by the ICAO in 2016. - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. MULTINATIONAL ENTERPRISES IN NIGERIA, THE CHALLENGES OF ACHIEVING MILLENNIUM DEVELOPMENT GOALS IN NIGERIA: SMALL AND MEDIUM SCALE ENTERPRISES: AN OPTION, STRATEGY AND STRUCTURE WHICH COMES FIRST, ACCOUNTING FOR ENVIRONMENTAL COST IN HOSPITALS: BARRIERS AND MOTIVATIONS A CASE STUDY ON AL BASLE HOSPITAL IN TARTOUS CITY, BUSINESS ENVIRONMENT IN AUSTRALIA: A GLOBAL PERSPECTIVE, E-LOYALTY IN MARKETING: IMPLICATIONS FOR E-CUSTOMER FOCUS, THE AGILITY OF INDIA'S TOURISM INDUSTRY ON THE HEELS OF MODERN TECHNOLOGY ICT IN FOCUS 1. The airline delivers premium services and offers superiors connectivity to 1000 locations across 150+ countries. Journify | Home - https://journify.malaysiaairlines.com/content/journify/my/en/home.html, 4. Khazanah Mas's should consider the fact that at deficit levels of United States in an emerging economy can lead to rampant inflation and serious risks of currency depreciation. The company flew its first commercial flight in 1947 and was initially known as Malayan Airways Limited. The number of passengers may decrease while the cost of raw materials may increase. The airline is aiming to further implement innovative fuel optimization initiatives in addition to offering the highly fuel-efficient Airbus A350 aircrafts on the London route. Porter's competitive analysis framework was used to analyze the main elements that helped to gain competitive advantage in the aviation industry.The study also used SWOT analysis to examine internal factors that enabled MAS to improve its strategic management. Climate change and changing ecosystem is leading to the extinction of more than 20% of species on the planet by the turn of this century. PESTLE analysis. The purpose of this research is to examine the effects of external environment pertaining to the marketing strategy of Starbucks, a coffee chain in Malaysia. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. - E-Commerce & Related Infrastructure Development As E-Commerce is critical for Mas Malaysia business model. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. Developing strategies that can capitalize on Mas Malaysia strengths and help mitigate weaknesses and impact of threats of macro-environment. - Fiscal and Monetary Policies The Republican government tax break culture has increased the deficit and it can lead to fiscal trouble for the economy in coming years. For international flights, the regulations are strict, and this situation may lead an airline to push for more amenities to keep up with the competitors. The gender composition of labor market is a good indicator of disposal income of household, priorities of the households, and related needs. The company needs to set a research team that can work on creating a more environment-friendly aircraft. If there is huge income inequality in the society then the likelihood of conflict and crime increases. . Thus significantly impacting the ability of Mas Malaysia to build sustainable competitive advantage Customized Solutions Malaysia is a powerful country and one of the most vibrant economies in Southeast Asia. For different referencing styles and detailed guidelines, please click here. - Intellectual Property Rights and Patents Protection Before entering new market Mas Malaysia should focus on the environment for intellectual property rights. - Financial Market Structure and Availability of Capital at Reasonable Rates The quantitative easing policy of Federal Reserve has led to liquidity flooding all across the global financial markets. PESTEL analysis is mainly the assessment of macro environment factors. Banking systems is always the main segment of the financial sector. Nabil N. El-Hage, Leslie S. Pierson (2018), "Malaysia Airlines (A) Harvard Business Review Case Study. Both the airlines are leveraging each others strengths to improve customers travel experiences. However, there are various factors which affect the inclination towards self-employment. Feb 26, 2023 (The Expresswire) -- "Airline A-la-carte Services Market" Research Report 2023 Provides a Basic overview of the Industry including definitions,. Her neighboring countries are Singapore, Thailand, Indonesia, and Vietnam. It shares cordial relationships with Asia-Pacific nations such as Australia and has strong bilateral ties with Japan and India. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. Feel free to connect with us if you need business research. Most of the tourists are not interested in visiting countries that have threats due to political conditions. - Adherence to Common Law Is the country following common law which is uniform for all parties whether domestic or international. Here are some issues which can directly impact the business of airline companies: A country's economic condition is directly related to the business operating within the country. For this reason, the aviation industry is widespread and may get affected by different external factors. Strategy planning process often requires five steps PESTLE analysis PEST analysis (Political, Economic, Social and Technological analysis) describes a framework of macro-environmental factors used in the environmental scanning components of strategic management. Malaysian Airlines (MAS) has achieved substantial returns and constantly outperformed its competitors. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. Purpose of this agreement is to allow both country to have the right to fly across its territory without landing. Read More. On August 2021, the airline announced that it has been appointed by the National Sports Council (NSC) as its Official Airline Partner for the Tokyo 2020 Paralympic Games. - International Trade & Other Treaties The country has a good record of adhering to international treaties it has done with various global partners. There are some conditions with the employee conditions and flight times of which the airlines should be careful. There is a large difference in the different practices adopted by the hotels depending on the facilities and management. MALAYSIA AIRLINES Kaan Kemal Pakaydin SWOT ANALYSIS PEST ANALYSIS POLITICAL STRENGTHS ECONOMIC WEAKNESSES Owned by government Inflation rate - from 4% to 0.10%. The Group plans to reduce the overall CO2 emission by 25 million kilogram in 2021 and also aims to reach 50% usage of biodegradable materials for in-flight operations coupled with 50% of ground and in-flight waste recycled and up-cycled by 2025 onwards. Technology is fast disrupting business models across various industries. Air Asia PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. Mas Malaysia should assess to what level the local market is prepared to roll out the 5G connectivity. PESTAL analysis is used to overcome the weaknesses of the organization. Available at: https://www.marketingtutor.net/airline-industry-pestle-analysis/ (Accessed 21 June 2021). - Empowerment of Supply Chain Partners Khazanah Mas's should analyze areas where technology can empower supply chain partners. - Business Laws Before entering into new market Khazanah Mas's has to assess what are the business laws and how they are different from home market. - Threat of Terrorist Attacks We believe in the world of post 9/11, corporations such as Khazanah Mas's have to live with operating under the shadow of a terrorist attack. Malaysia is a Southeast Asian country; it gained her independence in 1957. Malaysia Airlines has also partnered with ReveMax and other tech companies to bring about digital transformation in the airlines and is also a part of the oneworld Member Airlines, an alliance of various airlines flying to more than 50 destinations. The neighboring countries of hers are; the Philippines, Indonesia, Vietnam, Singapore, Brunei, and Thailand. Due to the pandemic, many countries have temporarily suspended flights from other countries. This report is shared in order to give you an idea of what the complete Segmentation, Targeting and Positioning (STP) Analysis Report will cover after purchase. Business do face problem when the conflict is between public interest and proprietary technology similar to ruling in South Africa where government & judiciary allowed generic AIDS drug irrespective of patents of global companies. Raw materials may increase are they consistent with the business model of Khazanah &! On employee retention and different employee retention strategies adopted by the hotels of an economy hotels! All Malaysians wellbeing - https: //www.spendedge.com/casestudy/pestle-analysis-of-airline-industry ( Accessed 21 June 2021 ) have threats due to pandemic! Plays a major role in the 'Complete Report ' on purchase her independence in 1957 the it industry level corruption. 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