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Tuesday, 29 September 2009

India’s national flag carrier, Air India is an airline in trouble!To stay on course Air india is struggling , braving the tumultous winds of losses and debt that are trying to buffet it to the ground which is caught in the turbulent winds of an economic downturn that is affecting most countries and airlines over the world.
Let us not be too pessimistic as it is yet to happen. As Indians we have an inherent desire for survival and Air India’s Arvind Jadhav, Managing Director and Chairman, has taken a leaf out of Malaysian Airlines’ book to implement a plan of action to turn the company’s fortunes around. Air India Online.
In order to succeed the following are the problems that the airline will need to overcome.
Slackening demand for air travel due to the recession currently gripping the world
Fuel prices that are soaring up
Airlines that have greater access to our Indian market and the fierce competetion among them
For the purchase of new planes the ambitious plan leading to high interest rates
Huge debt running into crores

The Plan

Let the stakeholders know: By being open and blunt about the truth of the airline’s condition the idea was to do what Malaysian airlines had done, namely, create a crisis. The aggressive actions being taken to rationalize costs, improve revenue and change incentive models for employees as well as the integration of Air India and Indian Airlines all combined should bode well for the carrier’s turn around.

Drastic measures: Some of the suggestions that have been put forward for drastic measures have been to retrench employees above the age of 55 and to also stop contract labor. However, the merger of Air India and Indian Airlines is the only merger to date where no retrenchment has taken place due to the government’s intervention. Another measure is to give up the iconic buildings in Mumbai and New Delhi that have housed the airlines rather than lose them. Now the need of the hour is seen to be the heavy downsizing in terms of both people and aircraft .

Bring in the leaders: It has been suggested that leadership should be re-established, get the best private managers to run the airline; engage an international airline expert to give advice and guidance. Decisions would include the freedom to increase fares, change flight frequencies, remove routes and cut costs which would therefore need freedom to act, make decisions and carry them out.

Tap private sector talent: going after strategic leadership could be a key element in restructuring the airline. Many other international airlines have tried this approach quite successfully. Seek out the international senior management capable of managing commercial operations and fleet development and the airline will begin its turnaround is the verdict.

Go for a new network and new fleet: There will be a big yield of results if changes are made to the airline's flight schedule. The operating sectors where we do not make profits is not done!- there should be a cut on the loss making sectors. A more profitable utilization of the airline's planes and ground assets would be the result of realighnment of flights.
Ambitious plans one might say but Air India dates back to the 1930s and holds iconic stature in India - we cannot in all good conscience simply let it sink into the ground!
Air India Flights
Air India Flights
Air India, An Airline In Trouble

India’s national flag carrier, Air India is an airline in trouble! Caught in the turbulent winds of an economic downturn that is affecting most countries and airlines the world over, Air India is struggling to stay on course, braving the tumultuous winds of losses and debt that are trying to buffet it to the ground.
It hasn’t happened yet so let us not be too pessimistic. As Indians we have an inherent desire for survival and Air India’s Arvind Jadhav, Managing Director and Chairman, has taken a leaf out of Malaysian Airlines’ book to implement a plan of action to turn the company’s fortunes around. Air India Booking.
Some of the problems that the airline will need to overcome in order to succeed are:
Slackening demand for air travel due to the recession currently gripping the world
Fuel prices that are soaring up
Fierce competition from airlines that have greater access to our Indian market
For the purchase of new planes the ambitious plan leading to high interest rates
Huge debt running into crores

The Plan

Let the stakeholders know: By being open and blunt about the truth of the airline’s condition the idea was to do what Malaysian airlines had done, namely, create a crisis. For the carrier's turn around rationalizing costs, improving revenue and change incentive models for employees as well as the integration of Air India and Indian Airlines are the aggressive actions being taken which should combine to bode well.

Drastic measures: To retrench the employees above the age of 55 and to also stop contract labour are some of the suggestions that have been put forward for dastric measures. However, the merger of Air India and Indian Airlines is the only merger to date where no retrenchment has taken place due to the government’s intervention. Another measure is to give up the iconic buildings in Mumbai and New Delhi that have housed the airlines rather than lose them. Heavy downsizing in terms of both people and aircraft is now seen as the need of the hour.

Bring in the leaders: Re-establishment of leadership, getting the best private managers to run the airline, engaging an international airline expert to give advice and guidance is a suggestion given. However, the leadership team must have the freedom to act, make decisions and carry them out and such decisions would include the freedom to increase fares, change flight frequencies, remove routes and cut costs.

Tap private sector talent: In reconstructing the airline the key element would be going after stratergic leadership. This approach has been successfully tried by many other international airlines. Seek out the international senior management capable of managing commercial operations and fleet development and the airline will begin its turnaround is the verdict.

Go for a new network and new fleet: There will be a big yield of results if changes are made to the airline's flight schedule. The operating sectors where we do not make profits is not done!- there should be a cut on the loss making sectors. A more profitable utilization of the airline's planes and ground assets would be the result of realighnment of flights.
In all good conscience it cannot be let to sink into the ground though the plan is ambitious is what one would say and the Air India dates back to the 1930s and holds an iconic stature in India.
Air India Flights
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