IntroductionAirAsia originally was founded by government and on 2 December 2001 was bought byTony Fernandes. AirAsia was established in year 1993. AirAsia has travel around the earthandascend to become the world’s best in year 2001. AirAsia continues to spread out the wayfor low-cost aviation through the innovation, efficient and passionate approach to businesswith a route a network that extent through over 20 countries. There are some companieswhich link with AirAsia such as AirAsia X, Thai AirAsia, Philippines’ AirAsia Inc., AirAsiaJapan and Indonesia.In addition, for the vision part in AirAsia, AirAsia aims to be the largest low cost airlinein Asia and serving the 3 billion people who are currently underserved with poor connectivityand high fares. While for the mission of AirAsia, AirAsia wants to be the best airlinecompany to work whereby employees are treated as part of the big family. Besides, AirAsiatry to maintain the lowest cost hence everyone can fly with AirAsia. Highest quality product,embracing technology to lower the cost and improvement in service levels will be maintained by the AirAsia airline also. Lastly, create a globally recognized ASEAN brand will be themission part of AirAsia.In the values part, AirAsia will implement trough the following key strategies which are: Safety Low fare, no frills Lean distribution system Point to point network  High aircraft utilization Streamline operationThe loyalty programmedof AirAsia will be “BIG”. BIG was knownas the kind global programmedwhere can earn BIG Points to redeem “free airline flight”.Members can enjoythe preference booking, special offers and discount as an AirAsia BIG dedication member interm and condition apply. (AirAsia, 2013)  The University Of Sunderland BABM2UGB202 Introduction To Strategic Management2.0

 Strategic AnalysisStrategy analysis was known as the process of developing strategy for business bysearching the business and environment in which it operates. (BusinessDictionary, 2013) 2.1 PEST analysisPEST will be the type of situation analysis in political, economic, socio-cultural andtechnological factors are investigate to chart of an organization’s long-term plans.(BusinessDictionary, 2013)In the political part, AirAsia found that it is difficult to fly outside the Malaysia.Double-sided agreement will be the main barriers in the way of low cost carriers. The landingcharges will also be another big factor which influence on costing of low fare airlines.Besides, the low cost airline industry which situated in South East Asia has beenunderdeveloped just because the aviation market is tightly adjusted by bilateral air rightscontract.While in the economic part, AirAsia airline offers the low-cost carriers by providinginexpensive ticket and few in flight services. These may help in obtaining the attraction in thedistrict despite having the strong competition from MAS (Malaysia Airline). For the currentdepression will hit on the aviation business. With the slow down economy, more people willwant to buy the cheap tickets and enjoy the flight. Besides, the prices of the oil may beanother factor for the airlines. It is difficult to control the operation’s cost once the price of the oil increasing.For the social part, passengers are not willing to take the expensive airline for a long-haul flight.To help for the world’s population increasing, the numbers of tourist and educated person are needed as help for increasing the growth of aviation industry. SARS had scare people to fly over. “Safety First” was committed by the AirAsia, implement with allregulatory institutions, set and maintain constantly high standards and the last will beguarantee the security of staff and guests.

  The University Of Sunderland BABM3UGB202 Introduction To Strategic ManagementWhile in the technology part, AirAsia provides the online service which can combinesthe air ticketing with hotel bookings, car hire and travel insurance. AirAsia had pushed theinternet booking services in order to keep costs in check. Besides, AirAsia also introducingthe GO holiday, the online programmed where consumers can book the holiday packageonline in real time. With the airbus A320, there will be better performance and reliability ashelp in proving the fuel efficiency and extra capacity. (UK Essay, 2013)2.2 Porter 5 forcesPorter 5 forces are a model which used by the company for industry analysis andcorporate strategy development. This 5 forces include supplier strength, competition,customer power, the potential for new companies join the industry and threat of substitute products (BusinessDictionary, 2013)Figure 1: Porter 5 Forces diagram