The new Malaysia Airlines CEO Christoph Mueller has begun the process of rebranding MAS by stating Monday that the carrier is ‘technically bankrupt’ and that a brutal restructuring exercise is the only way forward. He went on to say that the rot had set in years before the mystery of flight MH370 and the tragic one-in-a-billion shooting down of MH17.
Of course this is nothing new but by stating what we all know and confidently but empathetically, he has shown us that he is serious and perhaps most important of all, he is prepared to do what no previous CEO has been prepared (or was allowed) to do, namely to do what it takes to rebuild the damaged brand.
He has begun by announcing three high level areas – pillars that will over the next 3 years put Malaysia Airlines back where it belongs, at the top of the Asian aviation business.
Phase one requires massive job cuts to the bloated workforce, new contracts for staff, the renegotiation of supplier contracts (as well as cutting the number of suppliers by 90%), the axing of some international routes and reducing the flight frequency on others, reviewing the 777-200ER fleet and selling off 2 Airbus A380s. MAS thought the A380 could help turn the carrier around and at one stage put in an order for 60 of the mighty jets.
But the huge, fuel guzzling A380 has had mixed reviews from airlines and pilots and rumour has it there has been little interest in the 2 aircraft MAS is looking to sell. I’d be surprised though if they sell off the 777s unless they intend to replace them with more modern, fuel-efficient alternatives.
Phase two will focus on transforming the carrier and apparently more than 40 areas for improvement have already been identified and the third phase will look at sustaining the new position of the airline.
So although the name hasn’t yet changed, the new Malaysia Airlines Brand is up and running.
Before you can go anywhere with a brand, you need three things. The first is a solid product offering. If you don’t have that, it doesn’t matter how much you spend on selling, marketing or advertising, the brand will not grow. We’ve seen that over the last 5 years as MAS spent more than RM1 billion trying to resuscitate the brand with advertising campaign after advertising campaign without addressing the brand’s structural issues.
Instead of trying to WOW customers with their product, former MAS CEOs cut costs, sold assets and ignored the passenger experience. The very heart and soul of what makes Malaysia unique – its people and the way they are – was ignored and instead cosmetic, shallow clichéd taglines were created and tacked together in a series of immediately forgettable tactical campaigns that did little for the brand.
The second thing you need when building a brand is a CEO who is prepared to look where others prefer not to look, who understands what needs to be done and is prepared to do what it takes and make the tough decisions, even if that means taking apart the existing brand and rebuilding it, brick by painful brick.
And the third key component is people who understand that the organization is the brand and that brand is part of a community. And this community, made up of people within and without the organisation will make or break the new brand. The new team will have to embrace and engage the community and understand that it is the community not the staff who make the MAS brand.
This team will need to create an environment where people work toward a common, clearly defined organizational goal and not a personal one. Arrogance, ignorance or the ‘tidak apa’ culture will have no place in the new environment. Instead a humble, collaborative, connected and engaged culture based around delivering value, not on the company terms but on the customer terms will be the order of the day.
You’ll notice that I haven’t mentioned anything about the new livery, logo, brand architecture, uniforms, positioning, celebrities, the brand story and so on. That’s because they are irrelevant if the three points above are not addressed first.
Rebuilding the MAS brand was never going to be easy but the early signs are good, long may it continue.