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Malaysia Airline System

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1.0 Executive Summary

This report aims to solve problem faced by Malaysian Airline System in the implementation of good service delivery in the flight cabins by integrating two of the management functions, which are organizing and leading & motivating. The problems that have being identified are impolite crewmembers, slow and inefficient cabin crewmembers and understaffed cabins. Sources of information were obtained from the Malaysian Airline System website, journal articles and personal observations. In order to overcome the problem of poor service delivery, the plan is to increase the competency of our cabin crew service member. In order to improve the service delivery and employees competency of MAS the plan is to organize the organization by incorporating 3 new taskforces, which are Reallocation, Recruitment Revision and Training revision & Improvement and 1 Performance Department. Leadership and Motivating are also used to improve goods service delivery.

Transformational-transactional leadership style is used to motivate the employees to accomplish the organizational goals. For the short term, the emphasis is on transactional leadership to motivate the employees and in the long run it is advisable to use transformational leadership to motivate employees, as employees are not motivated through monetary rewards only. Reward power used to motivate employees to perform is in line with goal setting theory which suggest that employees will be motivate if the goals are clarity, challenge, commitment and feedback. In conclusion, by incorporating organizing and leading & motivating theories, MAS will be able to resolve its poor cabin service delivery and regain its position as a leading commercial airline in the aviation industry. It is recommended that the brand equity of MAS is also promoted to raise awareness among potential and/or current clients.

2.0 Introduction
2.1 Purpose of the Report
This report aims to look at the main good service delivery problem faced by Malaysian Airline System (MAS). MAS is a commercial airline company based in Malaysia. It is also one of the biggest and most recognized commercial airline companies in Malaysia and abroad. We intend to highlight the problems faced by MAS in the cabin crew section. We will be focusing on cabin crew service delivery problems and how to overcome them based on the solutions that we have drawn up over the past few weeks. 2.2 Organization

Malaysia Airline System is one of the biggest airline companies in the world. It is also Malaysia’s premier commercial airlines. The journey began on 12 October 1937 with the help of the colonial British government to run an air service between Penang and Singapore, which were the 2 biggest and most important Straits Settlement colonies. The forming of Malaysia in 1963 and the subsequent separation of Malaysia and Singapore in 1965 made the airlines into a bi-national Airline Company. In 1973, MAS came into being with the separation of the Malaysian and Singaporean partners. 2.3 Problems

Over the past 2 years, MAS has had an alarming decrease in sales, increase in customer complaints followed by a disconcerting decline in the customer loyalty rate. This indicates that there is a problem in the organization and after observation, the problems stems from the cabin crew service. Some of the problems include issues such as impolite cabin crewmembers, inefficient/slow cabin crewmembers and also, that the department is understaffed. These problems if left unresolved will have tremendous negative impacts on MAS’s performance and will lead to losing even more of their market share. This in turn will cause employees to be de-motivated due to empty flights. However this benefits competitors, as they will be able to snatch away customers from MAS and increase their market share in the airline industry.

2.4 Purpose of Excellent Cabin Crew and Good Service Delivery MAS takes cabin crew service seriously as the cabin crewmembers are representatives of the company. The crewmembers are there to satisfy the customers’ (passengers’) every need and wants for their (passengers) personal comfort. They are also the intermediate representatives between the customers and the company, and good service delivery starts here. 2.5 Assumptions

MAS is assumed to be operating normally although they are facing problems such as those that were mentioned earlier which are slow cabin crew, impolite cabin crew and understaffed cabins. The management at MAS in approximately two years will solve these problems. 2.6 Functions

Two management functions as there are limitations to the amount of facts that we can gather to solve this problem. Our chosen functions are also in line with our strategies. 2.7 Plan of the Report

The functions of management that we will be looking at to promote good service delivery by the MAS cabin crew service section are organizing and leading. Our report will be arranged in the order beginning with the problems that are deterring us from delivering good service and its impacts. We will then move on to our goals on overcoming our problem. From there, we will be justifying our chosen management functions and shall conclude with our best course of action.

3.0 Goal(s)
As a company focusing on good service delivery, the plan is to reduce customer complaints by 40% in the next two years. In order to measure the performance, the goal will be the base of the measurement of improvement. Therefore, consistent monitoring of effectiveness and efficiency of the plan is needed, through the observation of the increase or decrease of customer complaints per flight and customer loyalty rate. Last but not least, to determine the success of the plan is through the observation of share price in the stock market. Increases in share price indicate growing confidence by consumers and investors in MAS. Ultimately, if the goals are realized, MAS will be able to achieve major performance improvement, which directly indicates to an increased performance of the cabin crew service for all our respected passengers.

4.0 Organizing
In order for the plans to solve the problem of bad cabin crew service to succeed, it is recommended that there be a reorganization of the Human Resources Department, following a mechanistic method. “The mechanistic organization, which builds upon Weber’s bureaucracy, is characterized by a hierarchic structure of control, authority and communication, a high division of labor, a precise definition of rights and obligations attached to each functional role, a tendency for interaction between members of the concern to be vertical, i.e. between superior and subordinate, and a low degree of autonomy on all levels of the organization,” (Sollund, 289). This basically implies that a stricter structure be used to ensure better efficiency.

4.1 Introduction of 3 new taskforce and Performance Review Department In this reorganization of the Human Resources Department (HR Department), three new taskforces will be assembled to address specific issues regarding the degradation of the cabin crew service; the Reallocation Taskforce, the Recruitment Revision Taskforce and the Training Revision and Improvement Taskforce. Besides that, a Performance Review Department will be establish to review and keep track of any progress or further degradation of the cabin crew service. This is essentially a combination of functional structure and divisional structure.

Functional structure is an “organization design that groups similar or related occupational specialties together and divisional structure is a structure “made up of separate, semi-autonomous units,” (Robbins, Bergman, Stagg & Coulter, 2009, p. 354). All these new divisions are the responsibility of the HR Department and as such, report to it. In turn, the HR Department reports up to Top Management. The taskforce are not permanent divisions of the HR Department. If this proves effective and the organization goal is achieved, then the HR department will be restructured so as to make these new divisions permanent.

4.2 Reallocation Taskforce
The Reallocation Taskforce is responsible for reallocating current employees to more suitable positions within the organization. This taskforce, along with the assistance of the head of the Cabin Crew Department will identify the worst performing cabin crewmembers and re-designate them to duties that may be more suitable to their skill set, such as administration staff or ground control. However, before the worst performing employees are reallocated, they are sent for Intensive Retraining, handled by the Training Revision and Improvement Taskforce. If this fails to improve the cabin crewmember’s efficiency and performance, he/she will then only be reallocated.

This will definitely help improve the current slow service and impoliteness, because if crewmembers that still fail to meet standards after the Intensive Training, that indicates that they are not suitable for the that responsibility and will be reallocated to a department that has less direct customer service related duties. As for the better performing cabin crewmembers, they will also be subject to training handled by the Training Revision and Improvement Taskforce, but only regular training bi-annually; this is to ensure that crewmembers maintain and/or improve their performance levels and to prevent their individual performances from becoming inefficient, negligent and stagnant.

4.3 Recruitment Revision Taskforce
The Recruitment Revision Taskforce will consist of members of the existing recruitment division, 3 representatives of the Cabin Crew Department and a representative of top management. It will attempt to address the problems faced by the cabin crew service from a “prevention” standpoint. They are entrusted will the duty of fine-tuning the interview process so that they are able to identity more suitable candidates for the Cabin Crew Department during recruitment periods. The new measures will include personality tests, interview questions and roleplaying exercises. These new initiatives are to verify whether a candidate is customer-oriented, as that is the most important characteristic of a cabin crewmember. These actions are pivotal to the improvement and maintenance of top-level cabin crew performance in the medium and long term.

4.4 Training Revision and Improvement Taskforce
This new division of the HR Department solely focuses on the short term by “curing” these problems that are plaguing the cabin crew service. As mentioned in section 4.2 of this report, it is the responsibility of the Reallocation taskforce to identify the crewmembers that require Intensive Training or regular training. This divisions purpose is straightforward, to handled the redesign and implementation of the training programs. The redesigned programs will focus on improving crewmember attitudes, manners, motivation and efficiency so as to address the current problems faced by MAS.

4.5 Performance Review Department
The Performance Review Department is the feedback center for this entire reorganization. This is the department that will collect and gather information regarding the performance of the cabin crew department and investigate and scrutinize the effectiveness of the three new taskforces. The information collected will include customer surveys, number of flight specific complaints lodged, reports from the head crewmember of specific flights and also reports from undercover Performance Review Department employees, employees posing as customers. All this information will be disclosed in a bi-annual report to the top-level management and the MAS Board of Directors. The report will be distributed a week before a bi-annual conference dedicated to the review of the new initiatives. During the bi-annual conference, the head of the Director of the Performance Review Department will present a keynote presentation of the data and results of the past 6 months.

5.0 Leading and Motivating
Leadership is the process of persuading a group to accomplish goals. A person who has managerial authority and the ability to influence a group of people is called a leader (Robbins et al., 2009). Good leaderships skills is vital to achieve organizational goals and be successful in the industry.

5.1 Leadership Style
The leadership style that is recommended to Malaysian Airline System (MAS) is transformational-transactional leadership. It is recommended that MAS managers use transactional leadership for immediate results where Cabin Crew Manager uses reward and coercive power to improve efficiency and encourage employees in the Cabin Crew Service to provide a pleasant customer service and they will be motivated in doing so as they will be rewarded. In the long run, Managers should adopt Transformational-Transactional leadership style to overcome the inefficient, impolite crewmembers and to motivate the crewmembers. Managers should slowly incorporate it to the employees and MAS culture. This will be further discussed below.

“Transactional leadership involves giving employees something in return for their compliance and acceptances of authority, usually in the form of incentives such as pay rise or an increase in status” (Pieterse, Knippenberg, Schippers & Stam, 2010). Transactional leadership style clearly defines the goals for the cabin crew department and the cabin crew manager uses reward and coercive power to achieve those goals. These employees are not self-motivated but are motivated through rewards and thus are closely monitored and controlled (Hetland, Mjeldheim & Backer, 2008) “Transformational leadership are leaders who stimulates and inspires followers to transcend their own self-interest for the good of the organization to achieve extraordinary outcomes” (Robbins et al., 2009). A Transformational leader empowers and gives responsibility to their employees and thus it revives their emotions that inspire them to act beyond their prescribed work.

They share the same value/cultures as the organization and also have a stirring vision of the organizations future (Seidman & McCauley, 2011). The Cabin Crew Manager should recognize crewmembers that receive good feedback from the customers, provide good service, and is efficient, friendly, creative, and innovative should be rewarded accordingly. These employees should either receive cash rewards, favorable flights, greater autonomy power or promotion in exchange for their productivity. MAS should organize a ceremony to reward these employees, which shows that the MAS recognize their sincerity and hard work. Subsequently, this will further motivate them and other employees to perform well in order to get recognize by the MAS, show their capabilities to the organization and ensure good career development. Hence, this will promote a healthy competition among the employees, as there are limited employees that will be rewarded.

In the long run, leaders especially Cabin Crew Managers should adopt transformational-transactional leadership. The group of crewmembers under them should first be trained to be creative in solving difficulties and strive to invent new effective ways of doing things. Managers have to transform these employees to be enthusiastic about the MAS welfare and not merely depend on rewards to perform. These managers should install a culture of innovating new possibilities to its employees. Pieterse et al. (2010) asserts that, if an employee tries to implement a procedure that backfires, then the manager and employee should take it as a learning curve towards better results in the future. Consequently, employees will take their own initiatives to improve the procedures, as creativity and innovation are regarded highly in this management style.

Transformational leadership will be especially beneficial to MAS in the long run and transactional for the short and medium term future. Employees who innovate procedures in service delivery that proves more efficient and effective than the current procedure should be complement with rewards. Moreover, in this dynamic service environment, employees need to come with effective and efficient solutions to provide a pleasant customer service to the passenger/customer that overcomes good service delivery such inefficient employees and impolite employees.

Transactional leadership and Transformational leadership should be implemented together to achieve favorable result and maximize employee potential, however emphasis should be on transactional leadership in the immediate and short-term futures, where as Transformational should be more emphasized as a long term effort. Seidman and McCauley (2011) said that, Transformational-Transactional leadership promotes inspirational way of motivation rather than driven by rewards alone as cash reward only complements employee’s productivity and creativity. 5.2 Leadership power

We recommend the use of Reward Power and Coercive Power to manage the proposed plan effectively. “Reward power refers to the power to provide positive remuneration” (Schlenker & Tedeschi, 1972). As discussed in section 5.1, if the employee achieves his goals, is efficient and provides good customer service. Then the managers should reward them for their productivity with allowances/bonuses, better flights to manage, promotion and a chance to compete for the cabin crew service employee of the month. As such there are incentives for them to continue performing well and beyond expectations as they are recognized and rewarded accordingly by the organization. This also shows that the manager appreciates the employee’s contribution to MAS.

“Coercive power is the power that rests on the leader’s ability to punish or control” (Robbins et al., 2009). Managers should use their coercive power if the employees are performing poorly, inefficient and providing unsatisfactory customer service. This will install fear in them as punishment awaits them if they do not perform accordingly. For example, the manager could ask them to manage the less favorable flights, suspend them, or even resort to salary reduction. This is to ensure that employees are aware of the consequences of poor performance, and thus will motivate them to perform.

5.3 Motivation
As discussed in section 5.2, Cabin Crew Managers are recommended to use reward power to reward employees who perform well in customer service delivery and achieves their goals. The rewards, mentioned in Section 5.2, include promotions and favorable flights. This is line with goal-setting theory. To keep the employees motivated, we recommend managers to introduce goal-setting theory, as employees are aware of the expectations required. “Goal-setting theory states that the expectancy of outcomes will be high if goals are difficult (challenging), as well as specific and attainable” (Lycette & Herniman, 2008). Cabin Crew Managers should set individual goals for each of their employees to accomplish on a monthly basis to boost their performance. In order for the goals to be effective and motivate employees, these goals should include clarity, challenge, commitment and feedback (Locke, 1978).

Goals should be clear and specific and goal-setting theory recommends a quantitative goal (Locke & Latham, 2002). For instance, reduce customer complaints for MAS flights to Europe by 3% this month. Secondly, employee needs to be challenge to achieve specific goals. Difficult goals are more motivating to the employees if accepted, as employees are challenging the goals and are enthusiasm to accomplish the goals (Locke & Latham, 2002). For example, the customer service that is provided by the employees should at least encourage 35% of the passenger/customer per flight to compliment them. Employees will be normally motivated by the feeling of achievement and will strive their best to achieve the specific goals.

Thirdly, employees will be committed to the goals target if they have a role in setting goals and making decisions. If the employees played a part in setting the goals then they will try their level best to achieve the goals as they have promise to deliver the goals and the goals are within their capability (Locke, 1978). When employees and manager collaborate together in setting the goals for customer service delivery, then the employees believe they can achieve the goals and accepts the challenge that motivates them to fulfill it.

Lastly, subordinates appointed by the Cabin Crew Manager should provide feedback to the employees on their performance. Feedback keeps track of performance, as it is a progress report that allows managers and employees to see the effectiveness of achieving the goals (Locke, 1978). As the timeline for the goals has expire, the feedback received should indicate clear and direct information on the employee’s performance in the customer service delivery and also indicates in which areas the employees can improvise.

6.0 Conclusion
Based on the findings of this report, it can be concluded that these strategies outlined will help solve MAS’s problems. The three new taskforces will help organize the HR Department more efficiently and effectively, which in effect will improve cabin crew service. This is to ensure that passengers are satisfied with the service delivery during flights. The refined Performance Review Department will provide oversight over the overall performance and progress. Moving on to leadership, the application of transformational-transactional leadership will help ensure the improvement of MAS’s future, short term as well as long term through promotion of discipline via transactional leadership and the reward and coercive powers, and constant performance development via transformational leadership.

Furthermore, the goal-setting theory supports the basic assumption that the organization goal itself will motivate the employees. Overall, these suggestions will bring about improvements to the cabin crew service of MAS, from the issue of impolite cabin crewmembers to inefficient cabin service in line with the goal set; to reduce customer complaints by 40% in 2 years. However, the issue of an understaffed cabin crew department cannot be addressed now due to current global economical factors.

7.0 Recommendations
These are some of the implementations to achieve good service delivery:
1. Introduce three new task forces (reallocation, recruitment revision and training revision and improvement taskforces) and a performance review department.
2. Send underperforming cabin crew members for retraining.
3. Implement the transformational-transactional leadership.
4. Raise awareness regarding coercive and rewarding power among employees.
5. Promote MAS pride and brand equity via international advertising and marketing.

Reference List

Hetland, H., Mjeldheim, S. & Backer, T. (2008). Followers’ Personality and Leadership. Journal of Leadership & Organizational Studies, 14(4), 322-331. Locke, E. A. (1978). The Ubiquity of the Technique of Goal Setting in Theories of and Approaches to Employee Motivation. Academy of Management Review, 3(3), 594-601. Locke, E. A. & Latham, G. P. (2002). Building a Practically Useful Theory of Goal Setting and Task Motivation. American Psychologist, 57(9), 705-716. Lycette, B. & Herniman, J. (2008). NEW GOAL – SETTING THEORY. Industrial Management, 50(5), 25-30. Malaysia Airlines. (n.d). Our Story. Retrieved October 4, 2011, from http://www.malaysiaairlines.com/my/en/corporate-info/our-story.html Pieterse, A. N., Knippenberg, V. D., Schippers, M. & Stam, D. (2010). Transformational and transactional leadership and innovative behavior: The moderating role of psychological empowerment. Journal of Organizational Behavior, 31(4), 609-623. Robbins, S., Bergman, R., Stagg, I. & Coulter, M. (2009). Management (5th ed.). New South Wales: Frenchs Forest, N.S.W.: Pearson Education Australia, 2008. Schlenker, B. R. & Tedeschi, J.T. (1972). Interpersonal Attraction and the Exercise of Coercive and Reward Power. Human Relations, 25(5), 427-439. Seidman, W. & McCauley, M. (2011). Transformational Leadership in a Transactional World. OD Practitioners, 43(2), 46-51. Sollund, R. (2006). Mechanistic Versus Organic Organizations’ Impact on Immigrant Women’s Work Satisfaction and Occupational Mobility. Scandinavian Journal of Hospitality and Tourism, 6(4), 287-307.

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