Account for the Development of Public Health Reforms in the 19th Century and Assess Their Role in Improving the Populations Health by the Early 20th Century Essays

Account for the Development of Public Health Reforms in the 19th Century and Assess Their Role in Improving the Populations Health by the Early 20th Century Essays Account for the Development of Public Health Reforms in the 19th Century and Assess Their Role in Improving the Populations Health by the Early 20th Century Essay Account for the Development of Public Health Reforms in the 19th Century and Assess Their Role in Improving the Populations Health by the Early 20th Century Essay OOO o 233,000, of Glasgow from 77,000 to 345,000, of Liverpool from 82,000 to 376,000 and of Manchester from 75,000 to 303,000 (Alcock,Daly,Griggs,2008) Small areas of habitation grew quickly until they grew into the major cities. Birmingham and Sheffield became famous for their manufacturing trades. London, Liverpool and Bristol grew because of the docks, railways and canals that enabled goods to be exported. The unprecedented numbers of people moving to, and indeed creating these towns and cities meant that housing solutions needed to be found very quickly; to this end some factory owners built accommodation for their workers, hese would be built close to the factories so that the workers could easily be called to work by the factory bell, as most workers did not have their own clocks. As the factory owners were motivated primarily by profit, and tended to view workers as Just another resource accommodation was often constructed to the lowest possible standard. Salford, once more important than Manchester, was then the leading town of the surrounding district to which it still gives its name, Salford Hundred. Hence it is that an old and therefore very unwholesome, dirty, and ruinous locality is ouses could be extremely basic with communal toilets and without running water, and with no arrangements made for the disposal of human waste. Over-crowded, ill-drained, badly-ventilated, and miserable abodes which line the narrow lanes and filthy alleys abounding in most large town (Roberts, 1855) With the numbers of people moving to the towns and cities there could not be enough houses built to cope with demand; in these cases people would be forced to live in cellars and other unsuitable dwellings, often alongside other families and even animals. It often appens that a wh ole Irish family is crowded into one bed; often a heap of filthy straw or quilts of old sacking cover all in an indiscriminate heap, where all alike are degraded by want, stolidity, and wretchedness. Often the inspectors found, in a single house, two families in two rooms. All slept in one, and used the other as a kitchen and dining-room in common. Often more than one family lived in a single damp cellar, in whose pestilent atmosphere twelve to sixteen persons were crowded together. To these and other sources of disease must be added that pigs were kept, nd other disgusting things of the most revolting kind were found. (Engels, 1844) Although the boom in housing created problems with the removal of human waste, however this had been a feature of urbanised areas for some time before the industrial revolution; as Samuel Pepys recorded in a diary entry for 20th October 1660, Going down to my cellar I put my feet into a great heap of turds, by which I find that Mr Turners house of office is full and comes into my cellar (Halliday, 2007) With the problem of waste disposal and over-crowding in squalid conditions came he inevitable increase in diseases. In one place we found a whole str eet following the course of a ditch, because in this way deeper cellars could be secured without the cost of digging, cellars not for storing wares or rubbish, but for dwellings for human beings. Not one house of this street escaped the cholera. (Engels, 1844) There had always been disease in the towns and cities, however, with the increased population it spread faster than at any other time, and there seemed no way to halt its progress. There were many diseases that flourished in these environments, ncluding Influenza, Tuberculosis, Typhoid, Typhus, and the most feared at the time, Cholera. Again, the repeated visitations of cholera, typhus, smallpox, and other epidemics have shown the British bourgeois the urgent necessity of sanitation in his towns and cities, if he wishes to save himself and family from falling victims to such diseases. (Engels, 1844) During this century, medical science advanced at hitherto unprecedented speed, and more people than at any other time entered t he medical profession, In the first half of the century the medical world was raising the xpectation that treatment of the body could become as exact a science as knowledge of the body. Throughout the land, much money and energy was being devoted to medical care and its study. Between 1801 and 1850 more university- educated men entered the profession in Great Britain (over eight thousand) than in all of previous history. (Haley 1978) However, there was still a lot to be learned about the nature of disease, and the causes of epidemics were poorly understood. The theory of miasma (the belief that disease was spread by smell and foul air) was still popular as an explanation of how diseases were spread. Cholera was greatly feared being a water-borne disease, attacked all, notably the middle classes with their better water supplies and struck fear into the hearts of the governors, local and national. The response to the outbreak of infectious disease varied from town to town, however police in Manchester responded to one outbreak of Cholera, by evacuating and disinfecting the area. The first court below Ducie Bridge, known as Allens Court, was in such a state at the time of the cholera that the sanitary police ordered it evacuated, swept, and disinfected with chloride of lime. (Engels, 1844) Towards the end of the century, Britain was involved in conflicts around the world in order to defend her empire from the emerging powerhouses of Japan and Germany who were keen to forge their own empires and trading routes. In 1899 conflict erupted between the British and the Boers, being the South African descendents of Dutch settlers. The Boer army turned out to be well prepared, well trained and provided with enough food and provisions to defend themselves for three years, whilst the British, having believed that the war would be quickly over, were nowhere near as well-prepared. The Boer war highlighted a serious problem for the forces, specifically that the recruits being called upon to defend the nation, being largely drawn from poverty-stricken areas where the conditions discussed above were rife, were often weak and of poor health. At that time, it became apparent that there were serious problems with public health in Britain: up to 40% of recruits in Britain were unfit for military service, suffering from medical problems such as rickets and other poverty-related illnesses. 80% of men presenting for service in the Boer War were found by the Army Medical Corps to be physically unfit to fght. wrww. forces- war-records. co. uk) The realisation that the population had become too weak to defend the nation, alongside the increasingly common outbreaks of disease arising from cramped, unsanitary living conditions of workers led to the Report of the Interdepartmental Committee into Physical Deterioration in 1904, which called for changes to be made to ensure the nations health did not deteriorate further than it already had. In the 1906 general election the Liberal Party gained power after an extensive period of Conservative government and immediately embarked on a series f Acts to improve the health of the nation. These included the provision of free school meals in 1906, health checks for school children in 1907, the Notification of Births Act in 1907 to allow midwives to ensure that newborn babies were being fed and cared for correctly and the Childrens Act of 1908, which was designed to keep orphans out of prisons and set up childrens homes for them. By focusing primarily on the health of children, they were working to improve the health of the next generation, thus ensuring a steady supply of fit and healthy individuals who could be called upon to defend the nation, if necessary. The Labour Exchange Act of 1909 and the National Insurance Act of 1911. were the first that the nation had seen that tried to tackle the problem of unemployment and ill health. The Labour Exchange Act sought to bring together those people who were looking for work with those who needed workers. The National Insurance Act was split into two stages, firstly giving people a right to medical treatment and sick pay in return for a payment each week out of their wages, and secondly giving people the right to unemployment pay for up worker before claiming it. There are differing theories about the effectiveness of hese reforms in improving the health of the population at the end of the 19th century and the beginning of the 20th century. What cannot be denied, however, is that the death rate fell in this period, from 22. 6 deaths per 1000 in England and Wales in 1860 to only 14. 4 per 1000 by 1905 (Gascoigne, S, 2012) Thomas McKeown, in his book the Modern Rise in Population (1976) looked at the detailed death records that were kept for Britain at the time of the reforms to assess their effect on the recorded deaths. He concluded, after extensive research, that the improvements to he nations health during the period 1850-1914 was as a result of a steady rise in living standards and the associated rise in average nutritional intake (McKeown, 1976) which was a secondary result of the reforms as people were able to support themselves whilst out of work and were able to move quickly from Job to Job, no longer subject to the fluctuations of business which may have previously led to a dependency on a poor law that could no longer support them. The dark shadow of the Malthusian philosophy has passed away, and no view of the ultimate scheme of things would now be accepted under which multitudes of men and women are oomed by inevitable law to struggle for existence so severe as necessarily to cripple or destroy the higher parts of their nature. (Dorling, D, 2002) McKeowns conclusions were questioned by Simon Szreter who wished to discover if the link between the death rate falling and the public health r eform was solely due to the better diet and living standards that were available, or it there was another cause. Szreter started out by analysing the relationship between diseases, with particular attention to the fact that once infected with a disease a person is more susceptible to catching other iseases. Szreter also suggests that it may be a case of the statistics being misreported that led to the reduction, as opposed to the medical and sociological advances that were occurring. In conclusion, there were many factors that that led to the development of public health reforms during the 19th Century; of these the most prominent were the rapid influx of people into the cities and towns leading to the rapid development of often unsuitable living arrangements, a polluted water supply, inadequate drainage and waste disposal; all of which contributed to the high levels f squalor experienced by those who lived there. This in turn led to outbreaks of diseases, which worried the government as diseases such as cholera seemed to infect regardless of class. The threat from disease combined with the lack of suitable soldiers to protect Britains empire from emerging states such as Germany spurred the Government into action and brought about the public health reforms in the 19th Century. The effectiveness of these reforms is still under debate, with academics trying to establish what was the primary reason for the death rate falling between 860 and 1905; the debate appears to be between those who believe it was the advances in medical knowledge of nutrition, cleanliness and the causes and treatment of disease and those who believe it was the public health reforms that were introduced because of the pressing need for intervention to prevent the poorest people becoming to enfeebled to work, thus becoming a load on the poor law. The reason that the health of the population increased into the early 20th Century seems to be a combination of public health reform and rapid increase in have a welfare state and NHS which are the em. y of the world.

Malaysia Airlines Business Plan Essay Example

Malaysia Airlines Business Plan Essay Example Malaysia Airlines Business Plan Essay Malaysia Airlines Business Plan Essay Business Plan Our Way Forward December 2011 Confidential 5 December 2011 Malaysia Airlines is in crisis. Our combined losses in the first three quarters of 2011 have already exceeded RM1. 2 billion, and the final numbers for the year will not improve upon this. The core passenger airline business is chronically challenged. The new Board and Management team, in place for three months, has been hard at work on a plan, referred to as the Business Plan, for Malaysia Airlines. This Business Plan outlines our near-term recovery plan to move us to profitability by 2013, as well as a set of ‘game changers’ to sustain our performance and create a platform for continued growth for Malaysia Airlines’ future. Executing this plan is key to our recovery. It will require complete focus and commitment to make hard and difficult decisions in the next 24 months and the strongest determination to see these initiatives succeed. To the Malaysia Airlines Team, all our stakeholders and customers, I ask for your unwavering support, patience and continued patronage in this time of challenge and opportunity. Ahmad Jauhari Yahya Group Chief Executive Officer Confidential Page 2 Page 2 Executive Summary Current Situation Our Recovery Plan Game Changers: Sustaining Our Performance Foundations Our Commitment 4 13 21 31 38 42 DISCLAIMER This Business Plan document is issued to Malaysia Airlines staff and external stakeholders with the purpose of disclosing a balanced and objective management view of the current situation, as well as the plan for recovery and our future growth. In the spirit of transparent management practice, we share some financial information as part of the discussion. For all intents and purposes, the financial information and figures pertaining to the future should not be construed as forecasts, projections or estimates of future profitability or representations of the company’s future performance. These figures are merely a set of aspirational targets which are aligned to the Company’s strategy as outlined in this Business Plan. This document and its contents have been approved by Malaysia Airlines’ Board of Directors, but are not to be considered as estimates, forecasts nor projections reviewed by external auditors. Page 3 Executive Summary Page 4 CURRENT SITUATION Malaysia Airlines is in crisis. We have incurred a net loss of RM1. 2 billion in the first three quarters of 2011 alone. More than 40 percent of our routes are loss-making and our unit cost position is 10 – 15 percent above corresponding revenues. In fact, we are in a much more tenuous position than we were in 2006 when we were in a similar crisis. The aviation market has become even more competitive with the rapid increase of the low cost carrier (LCC) segment, continued growth of the Middle Eastern full service carriers and revival in the fortunes of Asian full service carriers such as Garuda, Japan Airlines (JAL) and Thai Airways. Meanwhile, Malaysia Airlines has not focused adequately on the premium segment of the market, and our product quality has fallen. Our marketing efforts have been predominantly focused on tactical sales promotions rather than brand-building. With such adverse odds, our intensifying sales efforts could only generate low yields insufficient to cover an increasingly uncompetitive cost structure. Thankfully, we are still flying high in service standards, due to the valiant efforts of our superb Malaysia Airlines team. Yet the demand outlook for Asian aviation is strong. Across Asia, there is huge growth in disposable income, ramped-up access to credit cards and the Internet, and increased cross-border trade. Southeast Asia, in particular, with its combined population of over 500 million, myriad islands and underdeveloped road and rail infrastructure, is well-placed for aviation growth. Indeed, we expect ASEAN passenger demand to double by 2020. This is rightfully an exciting market for all participants in the aviation industry. This strong demand outlook is however clouded by both possible near-term shocks and certain longterm trends. Irrational exuberance in aircraft orders by Asian airlines is engendering a situation of capacity over-supply and excessive price competition. We expect the current Southeast Asian regional fleet to triple in the next decade. Increasing liberalisation also makes it easier for airlines to compete outside of their home markets. In the US and Europe, this combination of overcapacity and liberalisation has invariably yielded market consolidation, with only the strongest airlines surviving in their original form. Page 5 To make an already bad situation worse, there is the near-term possibility of a global recession emanating from Europe, and stubbornly high jet fuel prices conspiring to create the perfect storm of immediate turbulence. Without question, our current trajectory is unsustainable and nothing short of dramatic action will reverse our fortunes. Our weekly cash losses are in the millions of Ringgit. If we maintain our current business model, we will be out of cash by the middle of the second quarter of 2012. We will be bankrupt. Beyond the loss of 20,000 jobs, this would mean an indefinite end to connectivity with the many global hubs to which we are connected today. It is unthinkable and yet it is entirely possible. With new, expensive aircraft entering our fleet next year, our financing costs will increase markedly. While these new aircraft are larger and generally enable us to fly at a lower per-passenger cost, we must fill these aircraft to realise the savings. Indeed, if we do not fundamentally reengineer our commercial function, our losses in 2012 could easily top RM2 billion. To pay for our new aircraft and to cover our certain near-term losses, we must show investors that we are serious about changing our game. We have no other alternative. This is the greatest challenge we have ever faced as a business; a fundamental and radical overhaul is required to put us back on the path to sustained profitability. Here is our flight plan. Our vision is to become the preferred premium carrier, well-positioned for the coming consolidation of the Asian aviation marketplace. While Malaysia may be relatively small in the Asian arena, we will harness the country’s geo-economic centricity in ASEAN, emphasise our natural cost-competitiveness as a hub and utilise alliances and partnerships to significantly ‘punch above our weight’. Using a combination of tie-ups, we will achieve ‘virtual scale’, expand our network, coordinate our commercial functions and synchronise operations with similarly-minded airline partners. We will also exploit Malaysia’s competitive cost position to lower our costs. This will create the broadest array of network options for our customers and deliver an industry-leading cost position. We will follow a two-step approach in achieving this vision. In the near term, we are relentlessly focused on five initiatives to achieve a recovery to profitability for the 2013 financial year. We will then focus on a set of ‘game changers’ that will help us build a robust and sustainable business for the future. Page 6 OUR RECOVERY PLAN Enabling our ambition of becoming the preferred premium carrier must begin with a fundamental remodel of our core business. There is nothing revolutionary about this; it is the sheer simplicity of focus, and going back to basics. We will follow the playbook used by other airlines in their successful turnarounds but adapt it effectively to our unique context. The hard truth is, there will be some difficult decisions to be made to achieve a successful recovery. We will make these decisions in the best interests of our employees, shareholders, customers, business partners and Malaysians at large, and we count on the support of all stakeholders in this process. 1. Smaller yet profitable network. Going forward, our network shall include routes where our premium travellers will want to go, and where we can win in terms of competitive position and home advantage. We are shrinking to grow, and as we get back on firm financial footing, we shall expand our network to cover the world’s major economic regions and hubs. 2. Win back customers. We will take delivery of 23 aircraft in 2012, each with state-of-the-art passenger amenities. As we introduce these products, we must also reinvigorate our sales and marketing functions. We must win back the hard-earned loyalty of customers, especially those in Malaysia, and convince them of the superior value of our enhanced services. We also need to optimise our revenue management to enhance yields. 3. Relentless cost focus. As we take on new aircraft, we must quickly realise the savings from their improved efficiency. Lower fuel bills and maintenance expense reductions must be locked in early. We must also focus on keeping overhead and discretionary expenditure to a minimum. Finally, we will achieve savings in procurement through the collaboration with AirAsia and AirAsia X, subject to full compliance with global anti-trust legislation. 4. Keep it simple. We have become a very complex business with a number of different operating entities – core full service airline, MASholidays, MASkargo, MAS Aerospace Engineering (engineering and maintenance), training, catering, and ground handling. We need to de-clutter to ensure proper focus on our core business: flying our customers. We also need to give the ancillary businesses sufficient freedom to achieve their full potential. We therefore intend to commence the process of spinning-off our ancillary businesses starting with ground handling, training and engineering maintenance. Page 7 . Bridge the funding gap. Given the aircraft deliveries we are receiving in 2012, we acknowledge the funding gap that must be bridged. This bridge has five pillars of support: a. Achieve positive quarterly operating cash flow by the end of 2012. We shall ‘shrink to grow’ and consequently make resultant hard decisions to materialise reductions in costs and cash outflow b. Capital expenditure funding for our new planes through debt financing and leasing arrangements c. Working capital boost via the return of pre-delivery deposit payment (PDP) upon delivery of our new aircraft d. Proceeds from the potential spin-offs of our ancillary businesses e. Unwavering support from our major shareholders, whose support keeps our balance sheet robust despite a relatively high gearing Strong shareholder support is understandably conditional on Management undertaking all necessary measures including difficult and unpopular decisions to assure a positive operating cash flow performance. We shall indeed commit to do everything in our power to redeem the faith and support of our major shareholders. Page 8 GAME CHANGERS: SUSTAINING OUR PERFORMANCE Beyond the recovery, we will pursue a series of ‘game changers’ that will fundamentally overhaul our business model and sustain our performance. These strategic initiatives are sheer necessities to maintain relevance in a dynamic and ever-changing airline landscape. 1. Launch of a new regional premium airline. In the first half of 2012, we will launch our new shorthaul brand, flying an entirely new Boeing 737-800 fleet. Given a clean slate, a new business model can be designed from inception for sustainable commercial success without any inertial drag of legacy airline models. The relatively smaller size of the Boeing 737 means the airline can fly to more places where our customers want to travel, at times convenient to their schedules. We also intend to create a separate management structure to focus on the unique customer needs of regional premium travellers. This new airline shall set new standards for product and service quality, cost efficiency, and operational excellence. It will therefore set the template for airline success. 2. Alliances and partnerships. By the third quarter of 2012, we will be the newest member of the oneworld alliance. We are excited to join this extensive global network and look forward to increasing traffic via our combined networks and infrastructure. To augment our alliance membership, we intend to enter into material partnerships with major airlines to link our respective geographic strengths into a unified international presence. This will bring obvious mutual benefits to the parties involved as jointly, the whole will be in a much stronger competitive position than the sum of the parts. 3. Collaboration with AirAsia. On 9 August, we signed a Collaboration Agreement with AirAsia and AirAsia X. The Agreement provides all three airlines with a step-change improvement in operations through best practice sharing in select areas (such as fuel efficiency) and lower procurement costs (such as in fleet, ground handling and engineering maintenance services). Collaboration will also allow our customers to travel between more destinations than previously with an introduction of connecting services across the respective airlines’ networks. Without question, the collaboration is an essential element of Malaysia Airlines’ overall recovery and will further enable our sustainability going forward. Page 9 We recognise the vision and sacrifice of our principle shareholder, Khazanah, in making this collaboration possible. Importantly, the collaboration exercise is and will be done in full compliance with global antitrust and other regulatory requirements. 4. Ancillary business spin-off. With the successful spin-off of non-core businesses in our recovery plan, we can better focus on the core airline business and ensure a long-term competitive cost position for supporting services such as engineering maintenance, ground handling and training. In addition, we can ensure the full development of these ancillary businesses by attracting thirdparty specialists as strategic partners. Malaysia’s competitive cost position means we can build regionally competitive ancillary businesses with Malaysia as a hub. FOUNDATIONS To execute on our Recovery plan and achieve a sustainable performance, we will need to further develop three foundational elements. 1. Branded customer experience. Our customers are our top priority. In addition to the gradual rollout of our new product, we will improve customer satisfaction at every touch point – pre-flight, inflight and post-flight. Malaysia Airlines will deliver on its brand promise consistently, across all touch points, channels, national borders and at all times. In the months ahead, we will be making investments in a number of tools and processes, as well as mobilising the organisation across functions and layers to align and execute on the Malaysia Airlines brand promise. 2. Continuous operational improvement. In line with our vision to be the preferred premium carrier in the region, we will be making substantial changes to our operations to excel on three key dimensions: commercial effectiveness, flight operations and cost management. In terms of commercial effectiveness, we intend to seek continuous improvement in areas such as revenue management, direct sales and in the use of social networks for marketing. As we take delivery of our new fleet, we aim to set the new benchmark for excellence – for both aircraft and airport operations. Finally, while Malaysia Airlines has always had the potential to be the lowest cost player in the full service segment, we lag labour productivity benchmarks and are not best-in-class in areas such as procurement. We intend to bridge the gap with our peers in the region through continuous improvement programmes. Page 10 3. Winning organisation. Malaysia Airlines’ loyal and dedicated staff are a huge asset. However, we have to make a fundamental shift to a more performance-based culture. We wish to work collaboratively with our union and association partners to create a pay-for-performance compensation approach and culture. We have started to simplify our organisation structure to accelerate decision-making and create more accountability. We shall assemble the right people for the senior leadership of Malaysia Airlines and we shall not shy away from taking key decisions to effect this. And given the necessity ‘to shrink to grow’, we will have no choice but to right-size the organisation for the greater good of Malaysia Airlines’ survival. A leaner and meaner organisation will quickly become an agile, competitive and winning organisation. These actions will ultimately be the turning point on whether we can achieve and sustain acceptable financial performance. We expect to achieve a significantly reduced loss for 2012. Our ‘base case’ target for 2012 performance is a Group loss of approximately RM165 million. With an accelerated recovery, our ‘stretch target’ is for the Group to achieve a modest profit of up to RM238 million in 2012. We plan to sustain increasing levels of profitability and aspire to generate a profit after tax of over RM900 million by 2016. Page 11 OUR COMMITMENT A commercially sustainable flag carrier airline is vital to the broader eo-political and macroeconomic national objectives of global connectivity and trade linkages for Malaysia. However, our very existence is at stake given the internal and external factors combining to create the perfect storm. We must first take hard and potentially unpopular decisions – simply to survive, in order to then have the possibility to thrive. We therefore take a pledge of full commitment to undertake all necessary measures as outlined in this Busine ss Plan to first and foremost secure our survival, and ultimately to achieve our vision of being the preferred premium carrier. This radical flight plan will allow us to fly more satisfied customers to more places, build rewarding careers for our employees, and build a global brand that will make all Malaysians proud. We ask for your unwavering support, patience and continued patronage in this time of challenge and opportunity. The Preferred Premium Carrier 1 2 3 4 5 Smaller yet profitable network Win back customers Relentless cost focus Keep it simple Bridge the funding gap A Launch of new regional premium airline 1 Alliance and partnerships 2 Collaboration with AirAsia 3 Ancillary business spin-off 4 Branded customer experience B Continuous operational improvement C Winning organisation Page 12 Current Situation Page 13 Figure 1: Forecast demand growth Available Seat Kilometres (ASK) billions 1,068 ASEAN to/from mature markets 542 ASEAN to/from rest of Asia 2010 Source: OAG MARKET OUTLOOK The demand outlook for the Asian aviation sector is strong, fuelled by a burgeoning middle class and increased global and intra-regional trade. Long-term trends Based on forecasts of GDP growth, trade flows and other factors, we anticipate a doubling of demand over the coming decade (Figure 1). This presents a 2020 sizeable opportunity to all airlines in the region, and we are not alone in making sizeable aircraft Existing aircraft New narrowbody aircraft New widebody aircraft Figure 2: Planned capacity Aircraft ‘low cost’ 449 422 347 277 orders to fill the demand. By our count (Figure 2), 1,000 new narrow-body jet aircraft have been contracted for delivery over the next decade, an effective tripling of the commercial aviation fleet, likely outpacing the speed of demand growth. ‘full service’ ‘low cost’ 220 176 89 59 189 155 174 At the same time, aviation markets in the region are being liberalised, with most ASEAN countries 71 te Ca Gu s lf th ay A i r Pa ci fic Li o Ai n rA si In a di G Je o ts ta r Ti ge r C eb u M AS Et ih ad Em ira SI A targeting completely ‘open skies’ by 2015. This will allow carriers from any country to serve passengers in more overseas markets. Source: Press reports In other regions, this combination of overcapacity and deregulation has led to dramatic consolidation. In the US and Europe, the top three airlines account for 40 – 60 percent of the market. In Asia, they account for only 20 percent. Consolidation will inevitably come to Asia as well. Success in such challenging environments depends on the creation of a differentiated approach. This can be earned through building a leading cost position or by creating a unique value proposition to customers. We will do both. To thrive in this increasingly challenging market, we have to relentlessly pursue our vision of becoming the preferred premium carrier, well-positioned for the coming consolidation of the Asian aviation marketplace. We need to fundamentally remodel our core business and to put in place ‘game Page 14 hangers’ that will keep us ahead. Success of these efforts rests on the foundation of three elements: branded customer experience, a culture of continuous operational improvement and a winning organisation. We will fail if we do not deliver on all components of our flight plan. Perhaps more so than in other markets, we are also witnessing a rapid segmentation of the market, with carriers differentiati ng themselves along two dimensions: ‘low cost’ versus ‘full service,’ and ‘short haul’ versus ‘long haul. ’ Increasingly, airline owners are looking to place their chips in multiple segments (Figure 3). More than clarifying product tradeoffs to customers, this segmentation drives dramatic focus and simplification in airlines. The low cost carrier model (LCC) in particular has become immensely successful for those who can secure the absolute lowest unit cost in their relevant market. For those who cannot achieve rock-bottom costs, the challenge is to compete on service levels to customers more inclined to the ‘full service’ experience. Demand for ‘in between’ service levels (competing both on price and service) is disappearing, as customers largely target one particular product type. Recognising this, Malaysia Airlines is charting our future strongly in the full service, long-haul segment, with plans for extended participation in the full service, short-haul segment as well. Figure 3: Business model segmentation Short-haul Full-service Long-haul Low cost/value CCF* ASIA AUSTRALIA/INT’L Note: *CCF: Comprehensive Collaboration Framework between Malaysia Airlines, AirAsia and AirAsia X as announced on 9 August 2011 Page 15 Short-term shocks More so than other industries, airlines are vulnerable to macroeconomic events which create ‘demand shocks. In 2011 alone, there were two such shocks with the devastating earthquake/ tsunami in Japan and the floods in Thailand. Airlines must build business models able to withstand such external shocks. Figure 4: Profit/loss of Firefly business RM Turbopropbased business Jet-based business In 2012 , we must be prepared for the possibility of a global recession, brought on by Europe’s sovereign debt crisis, and a continued high cost of jet fuel. 2010 Source: Malaysia Airlines 2011 Figure 5: Skytrax annual ratings Ranking 1 2009 2010 2011 OUR RECENT PAST Over the past decade, Malaysia Airlines has lost its focus on the ‘full service’ portion of the market, which has historically been our bread-and-butter. 2 3 4 5 6 We launched our Firefly ‘low cost’ subsidiary in 2007. While the turboprop aircraft portion of the business has done well, the jet business launched last year has not yielded the returns we anticipated (Figure 4). 7 8 9 10 Source: Skytrax In an effort to fill aircraft, we priced seats well below our breakeven cost target. Though our cost situation would have improved with increased scale, it would have been insufficient for sustained profitability. We have since closed the Firefly jet business whilst focusing on growth of the profitable turboprop business for 2012 and beyond. With resources diverted to the ‘low cost’ segment of the market, we under-invested in the customer experience that is key for success in the ‘full service’ business. We are left with one of the oldest fleets in the region, which contributed to our removal from the Skytrax ‘top ten’ list of carriers. (Figure 5) Page 16 As product quality has fallen, we have lost the Figure 6: Unit revenues 2011 year-to date, Sen per ASK hard-earned loyalty of many Malaysia-based fliers. Last year, we lost more than 40 percent of KL-based passengers flying a ‘full service’ competitor airline to a city served by Malaysia Airlines. Our network, too, remains focused on the flows of a previous era, with a significant portion of our capacity concentrated on serving the highlySource: Company reports competed ‘kangaroo route’ connecting Australia to Europe. The declines in relative product quality and customer loyalty, combined with this overFigure 7: Unit costs 2011 year-to date, Sen per ASK 28. 5 25. 6 25. 0 29. 5 30. 5 representation of capacity on highly-competed routes have weakened our yields. Our unit revenue levels are now 15 25 percent below regional peers (Figure 6). 10. 4 11. 8 Our cost position is also not sufficiently lower than our competitors (Figure 7). As a result, our unit revenues have remained stubbornly below our unit costs. Source: Company reports Part of our poor cost position is due to the age of our aircraft. Just as the ageing fleet has driven down our pricing power, so too has it increased our costs. For every flight flown, we pay 15 20 percent more for fuel than does a competitor airline flying a more modern aircraft. Page 17 Unfortunately, the larger issue on the cost side is inadequate labour productivity (Figure 8). In Figure 8: Labour productivity 2010, No. of airline employees per aircraft seat the months ahead, there will be a need to overhaul our organisational structure. 0. 77 OUR STRENGTHS 0. 50 0. 43 Notwithstanding our internal challenges, there remains several assets in our arsenal. This includes strong technical capabilities and our well-trained cabin crew who continue to win awards (Figure 9) and is the hallmark of our Source: Company reports Malaysian hospitality. The crew’s dedication is to be credited for the strong brand equity we continue to enjoy. Both at home and overseas, the Malaysia Airlines Figure 9: Skytrax cabin crew ratings brand remains associated with our unique heritage and high-quality service. Rank 2008 2009 2010 2011 1 This positive predisposition to the Malaysia Airlines brand will receive a boost from our 2 new fleet additions and upgrades. Twentythree state-of-the-art aircraft will be delivered over the next 12 months, each with the latest 3 Source: Skytrax passenger amenities. Only through the foresight of previous management would we be in so fortunate a position to replenish more than half of our fleet of aircraft in a three-year period. These improvements will help reduce our fuel and repair bills, as well as convince our once loyal customers to return to our fold. Page 18 Signed in August 2011, our Collaboration Agreement with AirAsia and AirAsia X is a critical achievement. We are in discussions to coordinate our ground services, training and engineering maintenance functions, as well as to launch a joint procurement venture that will allow us to realise the combined benefits of scaled purchases. We estimate the cost savings to Malaysia Airlines alone will be more than RM100 million per year. 5,991 5,251 Figure 10: Malaysian competitive cost position 2011, Monthly wages, RM 11,856 In addition, we are close to finalising a connecting service that will enable passengers on either airline to seamlessly connect between carriers on nonoverlapping routes. Source: JETRO, Euromonitor Sydney Hong Kong 1,228 940 Beijing 846 Bangkok 588 Jakarta Singapore Kuala Lumpur Of course, any discussion and implementation of initiatives will be subject to full compliance with global anti-trust and other regulatory requirements. Our full entry into oneworld in the third quarter of 2012 will considerably enhance our network while providing baseload demand from our fellow oneworld members. In the months ahead, we will announce a series of additional partnerships that will drive increased commercial scale. These partnerships will be critical for us in the years ahead. Finally, our home remains Malaysia and that is our most defendable asset of all. Going forward, we must continue to realise all natural cost advantages (Figure 10) available to us to ensure we can profitably offer the best value in the sky. Page 19 STATUS QUO IS NOT AN OPTION A bold revision of our Group is necessary to avoid the failure of Malaysia Airlines as we know it. Weekly cash losses are in the millions of Ringgit. Without radical efforts now, we anticipate bankruptcy in the middle of the second quarter of 2012. Indeed, without action, our losses in 2012 could easily top RM2 billion. Preventing such an outcome requires a variety of efforts, but at the core must be a reversal of this loss-making. Securing funding for future operations requires evidence to new investors – be they through debt or equity – that a dramatic change in fortunes is possible in the very near term. The challenge is immense but, we believe, recovery is within our grasp. Firm and decisive actions will have to be taken now. Page 20 Our Recovery Plan Page 21 In approaching our recovery, we are focusing first and foremost on our primary, core business: the passenger airline. True sustainability means our passenger aircraft will be able to fly profitably whatever the broader economic and market conditions. To be clear, there are exciting opportunities for our ancillary businesses – engineering and maintenance, cargo, and training, to name a few – but success of the core business must be the cornerstone of the Group’s broader performance. There are five steps to our recovery. The first is to aggressively reduce capacity on routes that have generated losses over many years. As Figure 11 (page 23) shows, over 40 percent of our routes today lose money. Second is the effort to fill aircraft on our remaining network with loyal, satisfied customers. Next, we must relentlessly cut costs in all areas where it does not reduce the customer experience or our commitment to safety. Simplifying the business by spinning-off ancillary units is the fourth step. Fifth is to fund this recovery. This is by no means a small feat. Smaller yet profitable network 2 Win back customers We will suspend services on routes where we are substantially loss making. This will account for approximately 12% of our ASKs. It is our desire to return to the markets that we are exiting in the near future after we have stabilised our business. We will take delivery of 23 aircraft in 2012, each with state-of-the-art passenger amenities. As we introduce these products, we must also reinvigorate our sales and marketing functions. We must win back the hard-earned loyalty of customers, especially those in Malaysia. We also need to optimize yield through better revenue management and tactical sales programmes. 2012 profit impact: ~RM220 302 mil. 3 2012 profit impact: ~RM394 477 mil. 4 Relentless cost focus Keep it simple In a brutally competitive industry, we need to maintain focus on continually managing our costs down and achieving operational excellence. As we take on new aircraft, we must quickly realise the savings from their improved efficiency. Lower fuel bills and maintenance expense reductions must be locked in. Our overall business structure has become too complex with a number of ancillary activities becoming very large and complex. We therefore intend to ‘spin-off’ some ancillary businesses to ensure greater focus on the core airline business and give these ancillary businesses more freedom to grow and achieve their full potential. 2012 profit impact: ~RM309 392 mil. 2012 profit impact: ~RM255 337 mil. 1. Positive operating cash flow 2. New debt and leasing arrangements 3. Working capital boost via the return of pre-delivery payment deposits 4. Proceeds from potential spin-offs 5. Unwavering support of our shareholders 5 Bridge the funding gap Given the aircraft deliveries of 2012, we acknowledge the funding gap that must be bridged. This bridge has five pillars of support: Page 22 Figure 11: Profit before tax by route 2010, RM profitmaking lossmaking More than 40% of routes are loss-making 100 routes in network Source: Malaysia Airlines 1 SMALLER YET PROFITABLE NETWORK Our network is the heart of the Company and, while we want to serve our customers as well as we can, we recognise that we cannot generate profits on all the routes we are currently flying. Hence, we will, based on Malaysia Airlines’ own independent internal profitability and yield analysis, suspend services from select loss-making routes and will further focus on the core ASEAN region where we are the strongest. We plan to suspend Cape Town, Johannesburg, Buenos Aires, and other loss-making routes. On the other hand, we will increase our frequencies to key regional cities to benefit from the strong growth in regional demand. Successful turnarounds from other airlines, such as JAL (Figure 12) or Garuda, have been based on aggressive network cuts. We believe that, while we are cutting Available Seat Kilometres (ASK) by close to approximately 12 percent next year, we will be able to grow again profitably in the years ahead. Figure 12: Case example: Japan Airlines Capacity (ASK billions) and Net Income (RM millions) pre/post turnaround Profit impact: RM220 302 million Page 23 2 WIN BACK CUSTOMERS In 2012, we will take delivery of 23 new aircraft and phase out the A330-200 and B747-400 fleets. We will continue that effort over the next few years and, by 2015, we will have the youngest fleet in the region Figure 13: Aircraft age Years AirAsia Cathay Pacific Singapore Airlines Malaysia Airlines 13 12 10 9 10 (Figure 13). Our new aircraft will be equipped with best-in-class hardware and we will make significant investments next year to upgrade our meal services on all sectors (Figure 14). 2008 5 3 7 5 5 7 8 2011 2015 Building on our new fleet, we are revamping our approach to branding, distribution and customer loyalty. We are overhauling our commercial approach and revenue management systems to earn our fair share of corporate travel, drive front-end cabin revenue and fully leverage our oneworld membership to generate traffic (Figure 15). Source: Company reports Figure 14: Incoming fleet Figure 15: Sales marketing key business activities planned for 2012 Regional 1 Centralised New product roll-out Increase Frequent Individual Traveller (FIT) mix Connectivity improvement Direct channel push 11 Enrich (loyalty) Malaysia Airlines Corporate Travel (MCT) Programme enhancement Small Medium Enterprise (SME) push Business leisure campaign oneworld alignment 6 7 8 9 programme enhancement 12 Revenue management 13 Route suspension 2 3 4 10 Seasonality management impact 14 Malaysia Airlines 5 Enhanced Advertising Promotion deployment branding revamp Profit impact: RM394 477 million Page 24 Figure 16: Fuel efficiency savings Percent savings per ASK travelled 3 RELENTLESS COST FOCUS In a brutally competitive industry, we need to maintain focus on continually managing our costs down. In the short term, we will realise significant cost savings from our updated fleet deployment, with our state-of-the-art aircraft consuming less fuel. For example, as Figure 16 shows, flying the B737-800 Source: Aircraft manufacturers instead of the B737-400 will save us close to 23 percent of our fuel bill on a typical flight between Figure 17: Maintenance expense savings 2010, Expense per aircraft block hour, RM (Industry benchmark) Kuala Lumpur and Bangkok. In addition, our maintenance costs will decrease as we operate a newer fleet with lower maintenance requirements (Figure 17). However, benefits from our new aircraft deployment will not be sufficient. We have undertaken a comprehensive cost review that has identified RM200 million in 2012 savings Source: Form 41 opportunities (Figure 18). Improvements will come from increased utilisation of assets, early return of Figure 18: Key cost initiatives planned for 2012 Target run rate savings, RM millions 1 Productivity enhancement 70 80 2 3 ircraft and improved cost control over key functions. Strategic procurement of fuel Fuel efficiency from CCF bestpractice sharing Additional procurement initiatives Maintenance cost cap increase Early return of Boeing 747 15 20 30 35 30 35 10 15 25 30 We will realise further savings from the closure of stations in markets where we are suspending services. 4 5 6 Source: Team analysis Profit impact: RM 309 392 million Page 25 Additional infrastructure savings will be achieved once existing operation bases are consolidated to fewer locations. We will further focus on a review of our procurement contracts to achieve critical rate decreases. Finally, we are expecting cost savings through joint procurement and sharing services such as training and ground handling with AirAsia, subject to compliance with global anti-trust legislation. Looking forward, we will conduct a broader efficiency review that will aim at improving our organisation effectiveness and bring our productivity level closer to that of our regional peers. 4 KEEP IT SIMPLE Our overall business structure has become too complex with a number of ancillary activities becoming very large. We need to de-clutter the business to ensure greater focus on the core airline. We therefore intend to ‘spin-off’ some ancillary businesses to give these units more freedom to grow and to achieve their full potential. We intend to start with joint ventures in training and ground handling with AirAsia that will result in capex avoidance and lower costs through enhanced asset utilisation, scale and sharing of best practices. We believe these businesses have the potential to attract more third-party customers and grow into attractive stand-alone companies. The new companies may also consider tie-ups with strategic partners to enhance capabilities, expand geographic reach and access new customers. We also intend to spin-off MAS Aerospace Engineering (MAE) with an intention to create a strong standalone engineering maintenance services provider. We believe these spin-offs will also enhance Malaysia’s competitiveness as a regional aviation hub. Spin-offs will commence in the near-term but the completion of this process will be influenced by the availability of strategic partners and the state of the capital markets. Profit impact: RM 255 337 million Page 26 Short term: Arrest chronic losss include: Drive front-end cabin revenues Ramp-up corporate revenues Implement dynamic and integrated sales marketing programmes Grow direct channels Improvement potential (RM mil. ) 220 302 Win back customers Commercial excellence 394 477 Relentless cost focus Operational excellence Close stations according to own network rationalization Continuous improvement, examples include: Conduct thorough review of procurement costs Implement productivity improvement programme Improvements in on-time performance, aircraft turnaround times and asset utilisation Reduce structural fixed costs; operations consolidation Spin-off training , ground-handling and other ancillary businesses, some with AirAsia, to generate additional third party business Spin off MAE Total 2012 potential profit impact 09 392 Keep it simple 255 337 1,178 1,508 Page 27 SUMMARY Our ‘base case’ target is for the core business (passenger airline without cargo, catering and other ancillary businesses) to generate a significantly reduced loss of approximately RM340 million in 2012. As Figure 19 illustrates, we are targeting further improvement still with a ‘stretch target’ whe re the core business would breakeven in 2012. With estimated core airline losses of approximately RM1. 32 billion in 2011, this represents a one-year recovery of between RM 1,178 – 1,508 million. This is ambitious, but we believe it is achievable. Figure 19: Impact of initiatives to core airline profit 2012, RM millions 255-337 309-392 394-477 (200)-(190) (340)-0 (340) 220-302 (1,318) One-year turnaround worth RM 1,178 – 1,508 million 1 2011 Core airline losses (analysts estimates)* Smaller yet profitable network 2 Win back customers; commercial excellence 3 Relentless cost focus; operations excellence 4 Keep it simple Finance charges 2012 Target Note: All scenarios presume US$130 jet fuel and do not include any potential restructuring costs. Interpolated to arrive at core airline losses from analysts’ estimates of Group performance; figure is purely for illustrative purposes and does not represent MAS’ view of FY2011 losses Source: Team analysis, analyst reports We will begin suspending unprofitable routes early in 2012, which will first limit our losses. Our aggressive fleet plan, with the entry in service of the A380 aircraft on our flagship London rou te, coupled with best-in-class product and key innovations in customer service will drive our yield and load improvements. We also expect significant cost savings from the deployment of this new fleet, both from maintenance and fuel consumption. While those improvements have a cost, we have managed to keep constant some of our key procurement costs. We will also leverage our new fleet to improve the utilisation of our superb crew while still delivering top-notch service and safety. Finally, we will decrease our other fixed costs through a comprehensive review of both external and internal drivers. Page 28 Figure 20: Sources of Group profit 2012, RM millions 978 1,318 (165) (165)-238 102-165 (1,245) 011 Group losses (analysts estimates)* Improvement in subsidiaries profits in 2012 Core airline improvement in 2012 2012 Group target Note: All scenarios presume US$130 jet fuel and do not include any potential restructuring costs *Excludes gains/losses from forex exposure and hedging instruments Source: Team analysis, analyst reports For the Group (core airline plus all ancillary businesses), our ‘base case’ target for 2012 performance is a loss of approximately RM165 million. With an accelerated recovery, our ‘stretch target’ is for the group to achieve a modest profit of up to RM238 million. This is shown in Figure 20. Figures 21 and 22 (page 30) depict the reversal of our targeted cash position. As the ‘business as usual’ scenario makes clear, our current trajectory would almost certainly leave us in bankruptcy. With the Recovery plan, however, we plan to end the year having generated RM 313 – 744 million in cash. Once this recovery is accomplished, we will make aggressive decisions to change the battleground and become a major player in the upcoming consolidation as the preferred premium carrier. Page 29 Figure 21: Operating cash generation 2012, RM millions Figure 22: Cash balance 2012, RM millions Source: Team analysis Source: Team analysis As noted earlier, 2012 will be a key transition year on our path to becoming the preferred premium carrier. While we are beginning our turnaround process, the investments required to update our fleet and generate additional revenues will be massive. We are confident that we have secured a funding plan that will enable us to achieve this vision. This plan rests on 5 pillars: 1. Achieving positive operating cash flow on a quarterly basis by the end of 2012 2. Successful debt financing and leasing arrangements for our new aircraft 3. Working capital boosts from the return of pre-delivery payment deposits upon delivery of our new aircraft 4. Proceeds from the potential spin-offs of our ancillary businesses 5. Unwavering support from our major shareholders, whose support keeps our balance sheet robust despite a relatively high gearing Page 30 Game Changers: Sustaining Our Performance Page 31 OUR VISION While much about the years ahead remains uncertain, the forces of overcapacity, market liberalisation and industry consolidation are certainties. In markets where the consolidation has played out, only the strongest airlines survive in their original form (Figure 23) and maintain profitability. In the US, for example, where liberation began over 20 years ago, a series of mergers has produced a market where the top three players control 60 percent of the market, and only the largest two (Delta and United) appear to have developed a sustainable business. Similar events have played out more recently in Europe and Latin America, with small airlines losing market share and generating significantly lower financial returns – if they are profitable at all. This same scenario will play out in Asia in the coming years. Figure 23: Capacity share of leading airlines in deregulated markets 2009, share of market based on RPKs Other Other Other Gol American Airlines/TWA United/ Continental British Airways/Iberia Lufthansa Group Delta/ Northwest TAM Air France/ KLM LAN AirAsia Other Malaysia Airlines Singapore Airlines Cathay Pacific China Southern Top 3 Top 3 Top 3 Top 3 N. America (liberalised in 1980s) Source: OAG Aviation Europe (liberalised in 1990s) L. America (liberalised in 2000s) Asia (liberalisation beginning) Our vision is to shape the future of the industry and be a leader in the consolidation in Asia by becoming the preferred premium carrier. We must achieve capacity leadership amongst ‘full service’ carriers where we can and partner elsewhere to realise the true commercial scale of our business. Page 32 Figure 24: Capacity share of ASEAN-connected markets 2010, Capacity share based on ASKs MAS-Wings Other Other Other Other MAS Other Other Turkish Airlines Singapore Airlines Garuda Indonesia Other Jetstar AirAsia MAS Emirates Thai Airways Qantas MAS Tiger China Southern Garuda Philippine Airlines Vietnam Airlines British Airways Lufthansa KLM-Royal Dutch Airlines Cebu Jetstar Silk Air MAS Thai Airways AirAsia Singapore Airlines Eva Airways Air China China Eastern Vietnam Airlines Air India Jet Airways MAS AirAsia Thai Airways Singapore Airlines ASEAN to/from S. Asia MAS Thai Airways China Airlines Singapore Airlines Asiana Thai Airways Japan Airlines Gulf Air Saudi Arabian Airlines Qantas Airways Etihad Airways Qatar Airways MAS AirAsia Singapore Airlines Thai Airways International AirAsia Emirates Cathay Pacific ASEAN to/from Greater China Korean Air ASEAN to/from N. Asia Singapore Airlines ASEANto/from ANZ Singapore Airlines ASEAN to/from Europe Domestic Malaysia Source: OAG Aviation Intra-ASEAN ASEANto/from Mid East Going forward, we will prioritise our growth in regions where we can offer truly leading connectivity and defendable leadership positions. As Figure 24 highlights, the markets in which Malaysia Airlines competes today are highly fragmented: many airlines operate similarly-sized businesses. Beyond domestic Malaysia, Malaysia Airlines does not have a top two position in any market. The result is a relatively small and fragmented network compared to our competitors, and insufficient frequencies to meet the demands of our sought-after customers. This must change. Leveraging on our game changers, we will use strategic partnerships and alliances to extend connectivity especially to regions where there is a smaller commercial opportunity for operating our own aircraft. This will ensure superior connectivity for our customers while managing financial risks for our shareholders. By ourselves where we can, and with our partners where we must, we will build an increasing number of leadership positions. Our customers and our shareholders alike will benefit. Page 33 1 LAUNCH OF NEW REGIONAL PREMIUM AIRLINE The separation of businesses by aircraft type and distance travelled is increasingly common globally. Airlines including United, Qantas, Lufthansa and Singapore Airlines segment their businesses by aircraft type to some degree. The segmentation allows the airline with the smaller aircraft to focus on commuting and ‘feed’ services to the parent, while the airline with the larger aircraft can focus exclusively on serving long-haul passengers. Starting in the first half of 2012, we will launch our new regional premium airline, a short-haul airline connecting Malaysia to the rest of ASEAN and key cities in South Asia and Greater China. The new carrier will exclusively fly our incoming fleet of Boeing 737-800 aircraft with the latest in passenger amenities. While the early focus will be on key business routes less than four hours from Kuala Lumpur, the airline will eventually fly all domestic and regional routes flown by Malaysia Airlines today (Figure 25). Figure 25: Improved connectivity through regional premium airline To Tokyo To North Asia To Amsterdam To London To Paris New regional premium airline Malaysia Airlines mainline Page 34 Figure 26: oneworld benefits Enhance load factors through additional partner traffic and improved brand awareness Drive hub connectivity to facilitate international expansion and further destinations Leverage relationships to pursue joint purchasing Share equipment and resources for maintenance to reduce variable costs REVENUE EXPERTISE Leverage industry experience, management skills and expertise In the long run, potential advisors may come to Malaysia Airlines to share their international experience COST CAPITAL Alliance will offer us potential additional sources for capital Strengthens capital structure Supports / stabilises client’s valuation Long-term interest / investment in client Partner airlines (full members) 2 ALLIANCES PARTNERSHIPS In the second half of 2012, Malaysia Airli nes will become a full member of oneworld. The move toward an alliance will provide a broader network of international destinations, plus provide a basis for customers to increase their loyalty to our services (Figure 26). Beyond alliance membership, we are exploring the possibility of JVs with select partners in order to serve multiple markets together, while reducing the financial risks of participating individually. We look forward to sharing details of these initiatives in the months ahead. Page 35 3 COLLABORATION WITH AIRASIA The signing of the Collaboration Agreement with AirAsia and AirAsia X in August 2011 was a turning point for aviation in Malaysia. Working together will benefit all of our customers, improve our individual cost structures and grow Malaysia as a hub for tourism and aviation. For customers, collaboration offers opportunities to connect to more destinations seamlessly. In the coming months, the airlines will introduce a connecting service, allowing passengers on one airline to connect on select, non-overlapping routes served by the other carrier. At the same time, this move provides Malaysia Airlines with far broader reach, as passengers in more than two dozen cities around the region can be connected to Kuala Lumpur for their onward long-haul travel. Over the past few months, the three airlines have begun discussions about where joint procurement and consolidation of key activities could lead to greater efficiencies. Importantly, this is not about imposing one business model on the other. Rather, it is about looking for prudent opportunities where consolidated operations will deliver better service at lower costs for all. Fuel purchasing is one such area, where the combined scale of our global requirements can be used to negotiate better terms. For engineering , training and ground services, we can save capital costs by sharing common equipment and increasingly selling reserve capacity to other airlines. Already we have identified approximately RM100 million in annual savings for Malaysia Airlines alone. Ultimately, the collaboration must be about promoting the centrality of Malaysia as a hub for tourism and aviation in the region. With major hubs in Bangkok, Singapore and Hong Kong, we all have a role in ensuring the attractiveness of Malaysia to other airlines and potential travellers. Through collaboration, we have the opportunity to bring more scaled support services to Kuala Lumpur, and work with all government parties to create an environment hospitable to the growth of aviation. All collaboration negotiations and activities will, however, be carried out in full compliance with any regulatory or antitrust requirement. Page 36 4 ANCILLARY BUSINESS SPIN-OFF As documented earlier, we have significant opportunities to improve our productivity and simplify our core business. One element of addressing this will be to empower some of our scale support operations to spin-off and become separate companies in their own right. These new companies will be able to offer services to other airlines transiting in Malaysian cities. Their heightened scale will also benefit Malaysia Airlines, as cost efficiencies are passed back to the core airline. At the same time, separating management will drive more focused attention and will bring all businesses to globally best-in-class operational and profitability levels. Notably, this model has been used successfully by Lufthansa, Singapore Airlines and Cathay Pacific. Consistent with this plan, we will move to a new structure, where a holding company will become our primary listed vehicle. The core airline business and the scaled ancillary businesses will be held under this holding company structure. This will drive improved focus for each of the separate businesses and deliver truly leading cost positions to the airlines, as the spin-offs compete increasingly with their competitors for third party business. Proceeds from bringing on board strategic partners can be used to fund our recovery and broader strategic objectives. Figure 27: Corporate structure Holding Company 100% 100% In future lt; 100% 100% wide-body narrow-body including Firefly Turboprop 100% pilot training/ academy 100% round services Near-term priorities Identify strategic partners for divestment, and assure best-in-class airline support operations Page 37 Foundations Page 38 A BRANDED CUSTOMER EXPERIENCE The Malaysia Airlines of the future will strive to deliver superior customer experience at every touch point: when customers book flights, before, during or after the flights. In the months ahead, we will be making significant investments in tools and processes, from call centres and our website through to the layout of our aircraft to ensure that we are paying attention to all details that matter (Figure 28). Figure 28: Components of Branded Customer Experience Page 39 B CONTINUOUS OPERATIONAL IMPROVEMENT After reaching breakeven in 2012, we will further increase our profitability by making bold moves to align operational efficiency with the highest standards in the world (Figure 29). Our goal is to achieve the highest customer satisfaction while improving our revenues and operating as efficiently as possible. This improvement will come in several steps and will be anchored around three pillars: commercial excellence, best-in-class flight operations and cost optimisation. We know it will take time but we have the core assets to build on. On the people side, our employees have a proven track record of providing industry leading service. On the ‘hardware’ side, we are getting brand new aircraft and ground equipment that will provide us a strong base for improved flight operations. Figure 29: Continuous operational improvement Our revenues per ASK have been lagging those of our competitors. While a major effort will be done in 2012, we need to keep improving our capabilities. We will first revamp our sales and marketing strategies and combine them with best-in-class revenue management systems. We will also target more direct sales through our website. Lastly, we aim at building strong social media capabilities to improve marketing effectiveness. Commercial excellence Best-in-class flight operations Our customers want to get to their destination safely and on time. As we take delivery of our new fleet, we will target an increase in utilisation for all aircraft types. We will also reduce turnaround times and have more efficient engineering services from our MRO JV. We will conduct a thorough review of our fuel cost and investigate innovative ways to improve fuel efficiency. Cost optimisation We will be acting on two key levers to reduce costs. First, we will re-negotiate our procurement costs in catering, ground handling and maintenance. Our second lever is labour productivity. We will undertake a systematic comparison of productivity levels by function and department versus our competitors and strive to close the productivity gap. Where necessary, we will ‘right size’ the organisation to achieve costs in line with our peers. Page 40 C WINNING ORGANISATION A critical requirement to the recovery of Malaysia Airlines and achievement of sustained and consistent performance is to transform ourselves into a high performance organisation. There are a number of areas we need to address to achieve this important goal. Our labour productivity is well below our relevant competitors and our compensation philosophy is not sufficiently performance-based. In addition, our decision-making approach is cumbersome with a lack of clear accountability on key decisions. Because of the reduction in the network, there is a need to review the manpower level. We would like our organisation to be leaner, more nimble, customer-oriented and meritocratic with a compensation approach that ‘pays for performance. As part of this, we will realistically need to make targeted resource reductions. We recognise that this organisational transformation will be quite profound. We therefore commit to undertake this exercise by responsibly engaging with our employees and the Government so as to minimise the adverse impact of these necessary changes. We believe that these changes will make Malaysia Airlines a better place to work thereby enabling u s to attract the best talent and provide greater career advancement opportunities for our employees. Page 41 Our Commitment Page 42 Malaysia Airlines well-being and strength is a major component to the countrys economy. We carry the aspirations and pride of the Nation. Both at home and abroad, the Malaysia Airlines brand remains associated with our unique heritage of giving customers that personal touch. The airline also carries the expectations of all our employees, without whom the airline would not still be flying today, given all the challenges the Company has faced over the years. We are in a crisis and the current situation of the Company is a serious concern for our people, stakeholders, customers and business partners. We recognize that hard and unpopular decisions will need to be made along the way for MAS’ survival and future success. We will treat these decisions with the gravity that they merit, and forge solutions in the best interest of our employees, shareholders, customers and strategic partners. As this journey of recovery has begun, we ask for your support, patience and understanding as we rebuild Malaysia Airlines as the preferred premium carrier. The Preferred Premium Carrier 1 2 3 4 5 Smaller yet profitable network Win back customers Relentless cost focus Keep it simple Bridge the funding gap A Launch of new regional premium airline 1 Alliance and partnerships 2 Collaboration with AirAsia 3 Ancillary business spin-off 4 Branded customer experience B Continuous operational improvement C Winning organisation Page 43 Five-year initiatives Produced by GCEO’s Office at Malaysian Airline System Berhad MAS Complex A, Sultan Abdul Aziz Shah Airport 47200 Subang, Selangor Darul Ehsan Malaysia www. malaysiaairlines. com

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Further Exploration assignment - Essay Example The Janice and Melwyn, looking back said that they felt each new baby created an increased bond of closeness between them, but then as the kids became older, Melwyn reports feeling that they were often, â€Å"in the way†. As a result, the couple reports that for nearly a decade, they couldn’t remember going on a date, seeing a movie together or taking a trip without the children. This eroded the quality of their marriage and relationship. Stevie and Lucas say that they have felt their love grow for one another as they support each other in caring for a toddler and preparing for an infant. They feel that they have had to change very little so far in their lives because of kids. They never were into partying or going out much before kids and that hasn’t changed. They do miss the quiet that has been lost to the two year-old’s toys and constant talking. They know that crying is soon ahead, as are late night feedings and diapers, but all in all they feel as clo se as they ever have. Janice and Melwyn report that when they had their first child, Janice quit her job as a bank teller to stay home with the children. She had a high school diploma and Melwyn was trained as a machinist. The economy was good, so Melwyn took overtime in order to make-up for the loss of Janice’s income. Janice did not return to the workforce until her youngest child was in 7th grade. She says she didn’t want to work once the kids came along, but admitted that being a housewife was boring and isolating at times. Stevie is going to continue her studies at university through her pregnancy and after the birth of the next child. She is studying elementary education. She feels this would provide good additional income at some point and allow her to have time with her kids. Lucas is an engineer. He is just starting his career and wants to be the sole provider for the family for as long as

Plea Bargaining Essay Example for Free

Plea Bargaining Essay Most cases are resolved through plea bargains. This is resulting from negotiations between the prosecutor and defense attorney. Plea bargains can be made at any stage of the criminal justice process. Plea bargains can be either a charge bargains or sentence bargains. There are advantages and disadvantages with plea bargains. With plea bargains, it can reflect the due process and crime control of the criminal justices. Plea bargain is an argument between the prosecutor and the defendant to plead guilty to a crime to receive a lesser charge or sentence rather than going to trial and getting a harsher sentence or charge. These bargains are another way for the prosecutor to have the defendant to testify against other defendants on other cases as well as the trail they are in. Plea bargains are another way to help reduce cases from going to trial. Usually please bargains are between the council and the defense attorney but the judge can have a factor in it depending on the jurisdiction. They can work with the judge for a predetermined sentence. If the prosecutor goes back on the agreement, the defendant can ask the judge for relief. The judge may use different tactics to go about this such as withdrawal of the agreement or have the prosecutor go through the agreement there are distinct types of plea bargain. Charge bargaining is the most common and used plea. Charge bargaining involve negotiating charges that would be filed. This plea bargain will be to lesser charges and the higher charges will be dismissed. Sentencing bargaining involves pleading guilty to the state charges and not to a reduced charge so that the agreement is for a lighter sentence. There is also a lesser used plea bargain called fact bargaining. This bargaining uses certain facts in return to not use other facts in the case that would cause a different verdict. The plea bargain has to follow through with these knowing rights: a knowing wavier of rights, a voluntary wavier, and a factual basis to support the charges t which the defendant is pleading guilty. Plea bargaining is often criticized but the majority of convictions are due to bargaining. The benefits a plea bargains is there for the defendant. The defendant has this as an option instead of a trial, its uncertainties and to avoid maximum sentence. For the courts it lightens their loads for the judges and the prosecutors. The disadvantages of plea bargains are for those who are innocent pleading guilty for a crime to avoid the harsher verdict if found guilty in a trial. The plea bargains require the defendants to give up their constitutional rights. Rights that are protected by the fifth and sixth amendment: the defendant will have to waive the right to a jury, the right against self-incrimination in the right to confront hostile witnesses. The plea bargains are accepted as long as the defendant understands the consequences and volunteers to do so. Now if the defendant is coerced to do a guilty plea then it is unconstitutional. It also makes law enforcement and lawyers lazy in doing their job because it is an easy way out of not taking the time to investigate and to prepare a decent case. The due process makes sure that the defendant is receiving fair treatment while in the criminal justice hands. Plea bargaining reflects the due process because if the prosecutor has all their facts together, they can pursue a case to avoid the motions of a trial. The counsel allows the defendant the option of the plea bargain. If accepted, their sentence is reduced. The crime control assumes all is guilty before court so the plea bargains will not likely to be used here. The crime control suggests everyone is guilty and they should be tried and punished before the court. Though they are on opposite ends, the due process and crime control model have benefits that all of the branches of the criminal justice can handle. To ensure those individuals are receiving fair trails, the Fourth, Fifth, Sixth, and Fourteenth Amendments are very valuable to the justice system. According to FindLaw (2013), â€Å"Judicial economy simply means that one goal of the judicial system is to conclude cases in an efficient and speedy manner. Without plea bargaining, it is widely believed that there would be an explosion of cases which in turn would overtax and disrupt the current legal system. † Plea bargains are a notion to a sure sentence. Going to trial can result in months or years of arguments, hung jury, and evidence being unaccounted for, and etc. Prosecutors prefer to settle cases with plea bargains than to juggle a verdict with a jury.

Employee Motivation Case Study: Specsavers

Employee Motivation Case Study: Specsavers Culture is made up of values, beliefs, attitudes and behaviors shared by a group of people. Culture within a organization can also be describe as behavior s that results when a group arrives at a set of general unspoken as well as unwritten rules for working together. Base on data studied the culture at Specsavers is all about serving people. Such culture involves a lot of interaction with customers. As part of its culture Specsavers depends on its people to deliver the highest standards of customer care and service. To accomplish such the organization provides a variety of interesting job roles, as well as opportunities for career development. In culturing the organization the human resource department must play a vital role in paving the way forward. These roles include: Increase workforce activities: In doing so human resource personnel must ensure managers are properly trained as to how to manage and utilize resources from different backgrounds not just efface diversity. Creating and maintaining systems that will motivate and develop individuals employed to the company. Such move will only motivate employees to put their best foot forward thereby going the extra mile where necessary or when needed. Considering the kind of culture in place at the above mentioned company, providing and deploying the right mixture of skills, knowledge and experience will be essential in maintaining the culture type already in place. Create and maintain relationship between the people who work for and with the organization. Thereby catering for the changing needs of those employed to Specsavers. Undertaking measures that will ensure proper execution of action that will promote success for all. Employees are expected to share Specsavers vision of providing patients with the best possible service. In realizing the companys vision Human resource must assist by ensuring proper training for the human resource workforce. Before sharing the companys vision one must first have full knowledge as to what are the companys. Therefore it creating a manual outlining the companys vision and objectives would be a good way to start, then ensure that all staff is furnish with a copy. While not everyone enjoys reading; the next step for human resource would be to host seminars explaining the document in its entirety, giving individuals a chance to voice their concerns and have their questions answered. With full knowledge as to the objectives and vision of the company all parties involve will be better able to embrace and realize the companys vision, thereby enhancing their personal growth as well as the companys growth. One key factor in employee motivation and retention is the opportunity employees want to continue to grow and develop job and career enhancing skills. In fact, this opportunity to continue to grow and develop through training and development is one of the most important factors in employee motivation. Other ways of ensuring staff has the potential to deliver quality customer care and are motivated are: Ask the employee to train other employees with the information learned at a seminar or training session. Offer the time at a department meeting or lunch to discuss the information or present the information learned to others. Expand the job to include new, higher level responsibilities. Provide the opportunity for the employee to cross-train in other roles and responsibilities. Assign the employee to head projects or teams. Provide more authority for the employee to self-manage and make decisions. According to the overview Specsavers depends on its people to deliver at the highest level, thus with such measures and more implemented the directors and owners at Specsavers along with its customers will be in for a treat as it relates to customer care. While all three (3) terms are job related and can be observed within most organization worldwide, one should always bear in mind that there are differences between the terms explained below. Job roles within organizations come with different levels of responsibilities. Such levels are directly related to persons expertise and training. Job description is a written statement that defines the duties, relationships and results expected of anyone in the job. It is an overall view of what is to be done in the job. Typically it includes is a written statement that defines the duties, relationships and results expected of anyone in the job. It is an overall view of what is to be done in the job. On the other hand, job specification can be deem to be a statement of employee characteristics and qualifications required for satisfactory performance of defined duties and tasks comprising a specific job or function. Technology and Human Resources In todays world information cannot be carried out effectively without high-tech tools. Technology has simply changed the way in which companies communicate overall. By extension technology has changed the skills that employees really need. While trying to cope with such changes companies word wide has to also deal another growing disease known as globalization. Globalization simply reduces the autonomy of the nation state. Hence, provide less protection and barriers to trade; allow companies the freedom to move their jobs elsewhere; in the end force companies to choose the lay off or redundancy path. As a result firms today are threatened by globalization, technological advancement and sustainability challenges. In handling each challenge the human resource managers do have a role to play. He or she must direct the firm in dealing with as well coping with the rapid changes. Such HRM must develop systems to ensure that their human resource is highly productive. Such a person must ensure that their way of doing things is highly adoptable. Thereby able to change quickly to suit the needs of the market thereby meet the need of their customer and at the same time outperform their competitor. To further deal with the sudden changes HR must familiarize themselves with sophisticated devices, this while educating others employees. In the same breath use electronic communication to develop measures to safeguard data integrity; protect customer data thereby preventing identity theft. Motivating employees to perform effectively from remote locations; as well as managing IT cost and new developments are also great ways of directing a firm. Raise standards: The human resource manager is responsible for the establishment of standards that provide quality management guidance and quality assurance requirements for business. These standards allow manufacturing to receive certification for complying with world-class standards for quality. This certification is important to have especially if you are handling large global accounts and need for your customers to trust that your product is in compliance with set standards of quality. According to Gary Dressler; Human Resource Management is a process of creating and maintaining relationship between the people who work for and with an organization. At Specsavers a lot depends on its people to deliver the highest standard in terms of customer care. In return staff members are provided with variety of interesting job roles, as well as opportunities for career development. With such culture in place at Specsavers poor management and leadership style will have adverse effects on relationship with staff; thereby interfere with performance of the business. The harmony and quality of the team revolves around good leadership. The impact of bad leadership can turn out to be an expensive experience for the company. Good leadership is the driving force that pushes the members forward to the company objectives. Management must understand the strengths and weaknesses of its members or team and provide the encouragement to the team. Praise and encouragement on good work has immense power to bring out the best in a person. However a poor leader only sees the weaknesses and uses it as a way for blaming the members which results in a low morale within the team. A team with a low morale loses interest in their tasks, leading to delay in the production of outputs. Delay in the results leads to the payment of penalty, thereby eating up a huge portion of the companys revenue. Similarly a highly de-motivated team on losing the passion to work fails to come up with innovative ideas and has a lower level of commitment to the task allotted. This has a negative impact on the productivity of the products and services. Inability to come up with imaginative and innovative ideas can lead to the loss of business, especially in knowledge industry as the customers prefer those companies which can aid to its profitability through significant brainstorms. The team leader assists the team members to identify their individual goals on the basis of their strengths and weaknesses. An individual who lacks the leadership skills fails to assess the strengths and weaknesses of his team and thus would not be able to guide his team in attaining the goals. Absence of an effective counsel leads to ineffective time management. The long hours put in leads to a disruptive work-life balance bringing about a high level of physical and mental stress. High level of stress ends up in physical and psychological diseases, thereby making one abstain from office for days. Failure to provide the output on the pre determined date leads to the payment of huge penalties to the customers and loss of business. Thus a quick recovery from this cycle is inevitable for the survival of the business entity. A poor manager has little control over time management. His ineffective leadership fails to draw commitment to work resulting to long hours in the office. He also fails to understand the individual capabilities of his members, pushing unmanageable work load on the team members. Lack of an effective communication amongst the manager and the team members, the heavy work load, and the immense dissatisfaction forces the individuals to move to another project within the same company or to resign from the company. Thus poor leadership qualities are one of the major causes for labour attrition. The importance of induction training must not be underestimated at anytime, this as it signals the start of the relationship between an employer and employee. It is during this time important standards and patterns are set so as to enhance good behavior for the future. Inductions should develop the skills, knowledge and behavior that an organization needs. These requirements need to be defined beforehand in order to ensure a smooth working relationship. Induction training should entails immediate needs and priorities, so health and safety, facilities and conveniences should always be explained immediately. It is also important to ensure employees understand any contractual relationships they are entering into. Other aspects of such induction should focus on the organization and the job. Regarding the organization, new employees should be given a structured view of the organization by receiving mission statements, structure charts and business plans. They need to know how they fit into an organization, so meetings with appropriate people and accountability charts are vital. Inductees must also be familiarized with the culture of an organization and also need to understand all relevant rules. This way when given the job persons will hit the ground running have full understanding of what is required of him or her; thereby not hampering production in any way. Balanced Scorecard The purpose of the balanced scorecard is to implement a business strategy thereby translating it into a set of performance measures derived from strategic goals that allocate rewards to executives and managers based on their success at meeting or exceeding the performance measures. Balanced Scorecard enables companies to evaluated activities from various perspectives such as: Financial perspective Customer perspective Process perspective Innovation perspective http://t2.gstatic.com/images?q=tbn:ANd9GcTHWuztOjGZ5nZV8Y795LtpIiAs-NryApxcMP3HUYUFSOli2km7wQ Building a Country: Malaysias Development Building a Country: Malaysias Development Abstract In this paper, the major discussion is about the process of building Malaysia country. Besides, it also includes how the Malaysian people accept the revolution from Sultanate perspective until the country becomes a democratic country. Malaysia had achieved their independence day in the year of 1957. In these democratic countries, there are a few political parties which are formed before Malaysia gets their independence day from the British which are United Malays National Organization (UMNO), Malaysian Chinese Association (MCA) and Indian through Malaysian Indian Congress (MIC). In that time, they are the three biggest political parties which are occupied by the three biggest ethnic in Malaysia which are Chinese, Malay and Indians. These parties are formed to fight for the independence of our country, Malaya which is now Malaysia. In addition, the factors which affect the process of building our country, Malaysia are also being discussed in this paper. Besides, through this paper, we will also know how our prime minister builds Malaysia. Introduction 31 August 1957 is a historical day in Malaysia because it is the day where Malaysia gained its independence from British which had colonized our country for few decades. At that time, the major politic parties which consists of United Malays National Organization (UMNO), Malaysian Chinese Association (MCA) and Malaysian Indian Congress (MIC) which are being separated by their ethnic and different identity. These parties had to cooperate together by putting aside of their own ethnic and misunderstanding to deal with the independency of our country, Malaysia. In this way, these political parties, UMNO, MCA and MIC had formed an association party based on their own ethnic to participate in the election to choose a leader to lead the peoples to fight for independence. On that time, Tunku Abdul Rahman, which has become our first prime minister in Malaysia had changed the current style of setting up an association of government through the election where the winning party does not have suf ficient votes from the peoples to form a government. After that, a new political party, the Alliance party, is being formed after people from different ethnic done with dealing within each other. Tunku Abdul Rahman, our deceased prime minister is the leader of the Alliance party and he has won the election on that time with the agreement from UMNO, MCA and MIC where they cannot be one of the participate where the leader of the Alliance party contest. It is the first in the history in all over the world where a multi-racial together formed a political party. Malaysia, which is located in the middle of the Southeast Asian region in the world map, is directly affected by many other factors. There are some of the important principles which must be examined before analyze the politics in Malaysia, for example, most of the people in Malaysia are Malay, so they are the leader in the politics. Besides, social civilization and politics have a strong bond between them. In addition, culture be tween different religions also has some effect on Malaysian politics. Historical Perspective of Malaysian Politics: Nationality and Politics On 16 September 1963, Malaya, Singapore, Sarawak and North Borneo (Sabah) has combined to become a union called Malaysia. All the states in Malaysia claim that they are Malaysian people and there is no any separation compared to the neighbor country such as Thailand, Indonesia and Philippines. This shows that even though Malays are the dominant in this country and they have the first priority if compared to other clan in Malaysia, they still can tolerate and accept each other with different ethnic and races. There are few states in Malaysia which have their own Sultan which is the head of the state and even though after the federation of Malaysia, those state with the Sultan will still have their own power. While in Sabah and Sarawak, they are given to have their own way to administrate their own states. The unity among the people from different states allowed Malaysia to change from a small country into a big country. After Malaysia has become independence in 1957, they seldom focus ed on the nation building compared to state building. But after Mahathir has taken over the prime minister position, he promoted a ‘Look East’ policy which gives the first priority to the east. Besides, he also makes Malaysia to recognize as an Islamic state and the government is ruling the country with a right view. The Transformation from ‘sultanate nationality’ to ‘nation building’ Malays, who are the dominant in Malaysia, are divided into few groups because of different states and ethnic and they are the main subjects when defining the nation building in Malaysia. Besides, they are strongly influenced by the loyalty, the Sultan and the King except for those who lives in Penang, Singapore and Malacca. These three states do not have any Sultan or King, so, they have to pay their loyalty to who govern the states. There are some divisions of the states in Malaysia which are Pahang, Selangor, Negeri Sembilan and Perak is called Negeri-negeri Melayu Bersekutu, while Kedah, Kelantan, Perlis, Johor and Terengganu are called as Negeri-negeri Tidak Bersekutu. While for Penang, Singapore and Malacca which do not have any Sultanate or King are called Negeri-negeri Selat. All this separation had created some arguments which have affected the nation building. UMNO and Malayan Union in 1946 UMNO, a party which united all the Malay association from the Peninsula to fight for the proposal of Malayan Union by the effort of a Johor Malay leader, Dato Onn Jaafar. Malayan Union is to unite all the Malays and non-malays to create an equal citizenship. Besides, Malayan Union also has a new idea which is to replace the traditional leaders, Sultanate, with a Governor. But, the Malays, who claim themselves as a Bumiputera reject this idea because they think that this might harm their identity and leadership of the Malay itself. In addition, they also rejected the concept that created by the British. Due to the strong power from the Malay dominant, the British colonial power to realize that they will not have any chances to win the support of the Malay communities through the rejection. After that Persekutuan Tanah Melayu was formed to replaced Malayan Union which is led by Dato’ Onn Jaafar. ‘Nation Building’ and ‘State Building’ under Tunku Abdul Rahman Tunku Abdul Rahman is the first leaders who balance the races and ethnicity between three major communities. He is the first leaders who gain the trust of all the communities in Malaysia at that time. Furthermore, the compromises between the leaders of different communities towards the power politics also under controlled. In Malaysia, the power politics are used to ensure that the multi religious-custom society is able to govern without any revolution which will cause chaos. Besides, it is also important that the nation building ethnic and the race in a country is stabilizing because it will cause harm if the racial ethnic balance is being neglected. During the general election in May 1969, Tunku Abdul Rahman has made a toleration with the sensitive issues which involves religious and racial. Besides, Tunku Abdul Rahman and Tun Razak also realized that harmony between the communities is the most important to ensure the peace of Malaysia. In September 1970, Tunku Abdul Razak replaced Tunku Abdul Rahman as the second prime minister in Malaysia. While in 1971, our second prime minister, Tunku Abdul Razak introduced a new policy, Dasar Ekonomi Baru. The purpose of this policy is to abolish the famine, to make equality to the socio-economic and abolish the recognition of the race towards the economic function. In addition, he is the first who formed the Barisan National to take over the Alliance Party which has become a strong party at that time. Until today, our Malaysia Government retains this strong national resilience to make sure the stability of the politic in our country. Besides, he also succeeds in building a good diplomatic relationship between the other countries. Due to the diplomatic relationship with China, it improves the position of Chinese ethnic in Malaysia which they can go to China anytime they wanted to. When our fourth prime minister, Tun Dr. Mahathir led our country, it is the best performance in Malaysia where all the sectors shows a good re sult. Malaysia as a Fundamental Moderate Islamic Country: Malaysia, is it an Islamic or Secular State? When our first prime minister led Malaysia, he ever said that Malaysia has an official religion which is Islam. But this statement has brought many troubles to Malaysia because the others who are non-Muslims and even for the Muslims also unsatisfied with this statement. Some even said that this is an anti-Islamic and causes the Muslims to separate into few different groups which are extreme, moderate and liberal. Many questions have been asked according to that statement and thus causing the worldwide politics become a complicated and brings harm to Islam. Malaysia, which is mostly dominated by Muslims, some of the parties like Pan Malayan Islamic Party (PMIP or PAS) take this opportunity to obtain their support in the election by using Islam as their center. They even use this to influence their supporters that UMNO and BN are the parties who will bring harms to Islam in their campaigns. Besides, they even develop a slogan ‘Membangun Bersama Islam’ to announce Hudud as a part of Islamic law and uses this to win over the votes from the Muslim supporter. Malaysia and Terrorism Dr. Mahathir has clarified the misunderstanding by some of the peoples on Islam in BBC interview due to some people call the Muslims as a terrorist. This has caused Malaysia has been prejudiced by other country due to this kind of statement. But, they do not know the truth which our country, Malaysia, is the only one multi-racial country who wins against the terrorism. Besides, Malaysia uses its democratic system to won against the communism after World War II. Tunku Abdul Rahman, who was the leader of Malaysia at that time, also stated that he has prepared to fight against the terrorism rather than staying there doing nothing and he also encourage the people to fight for it. After that, the spirit of fight against the terrorism has influenced many other countries and thus, Malaysia has become the role model. In addition, Malaysia also shows to the outside world that they can live peacefully and harmony in one country with multi-racial and urge the world community to stop hurting eac h other. Unfortunately, some other people who misunderstand Dr. Mahathir who encourage the people in the world not to fight with each other like copying what Osama Ben Laden said. This caused the foreign people think that we are only acting to the world towards the terrorism but actually we are supporting it. It is bad to judge our country like this because we are really a multi-racial who can live peacefully with each other, tolerate and accept different culture between us. But fortunately Mahathir shown to the world by forming the GERAKAN which is represent by Muslim and non-Muslim. Fundamental Islamic Country When Malaysia firstly announces our country as a ‘fundamental based Islamic’ country, this news shocked all the Malays especially the PAS. Besides, Mahathir also said that whoever does not support the government parties will definitely go to hell after they died. It has frightens a lot of people. In addition, Mahathir also wanted to get rid of PAS because he thinks that most of the Malay will support PAS just because of their ideology. In addition, he also said that when building a country, development is more important than punishment and he said that he dislikes using weapon to rule the country. Furthermore, the non-Muslims know that the announcement given by Mahathir will not bring any harm to them because they have faith with Mahathir that he will guide Malaysia towards a good future. Even the UMNO in Penang, which is a politic party based by Malay, was also run by a Chinese leader. This can show that the harmony between the multi-racial in our country where they can accept each other. Malaysia and Mahathir as an Agent of Change: Malaysian State Building at the Era of the Globalized World Dr. Mahathir, Malaysia fourth prime minister stated that globalization means that it is a world without any border but does not mean everything named globalization is a good thing and must be well prepared if anything bad is happen, an action is needed to be taken. Malaysia is developing well under the lead of Dr. Mahathir and he never give up to guide Malaysia towards a better future. Besides, he also never loses direction when Malaysia is facing crisis. In addition, he also encourages the people to maintain a good relationship with their neighbor’s country. By this way, just can bring a lot of benefit to us while contribute to the economy of our country. Furthermore, Dr. Mahathir also realize that the global effects might bring negative effect to our country, so he hopes that this kind of effect can be minimize. Malaysian Ways: Role Models in Handling the Financial Crisis When Dr. Mahathir flash back the crisis that happened in 1969, he said that all the community should cooperate together to ensure that the crisis will not happened again. He also found an effective ways to reduce the divergence between different races and try to abolish the famine among the community. While dealing with the crisis of economic in Malaysia, he also facing the disturbance of the politic which caused by the other politic party who opposes the Barisan Nasional. But, Dr. Mahathir is good at dealing with the crisis. He was able to find an effective ways to handle the crisis by develop a new strategy to rebuild the economic in Malaysia. He also ever said that Malaysia is a business country where they trade and buy. This is how the economic in Malaysia grow. Besides, we also need the investment by the foreign country and maintain a good relationship with others country. When Dato’ Mustapa Mohamed work as our second finance minister, he bring our country economy back to the right track and thus Malaysia have an excellent achievement on that time. While in 1997, our country faces the crisis of currency but, Dr. Mahathir had decide to find ways to fix the currency exchange rates to save our country from financial crisis. A strategy has been developed to maintain the currency of our country. After the new strategy started, there is a change in Malaysia economic. Then they even build National Economic Action Council (NEAC) to give them some advice on the economic problem faced by our country. With the help of NEAC, some movements have been taken to solve the crisis. Besides, the government also takes some action to control the currency from being flowing out too much from our country. But fortunately this control is just for a while and the share market of our currency has back to normal and the investment from the foreign country is not affected. Many people invest in our country because our currency is in a fixed rate at most of the time and this is a good thing. Furthermore, the way how our country control the flow of our currency has also been recognized and used by the global financial system because it is unexpectedly a good way to solve the financial crisis and thus causing other foreign country to look high on our fourth prime minister, Dr. Mahathir. Meanwhile, some of the investor from western quit from invest on our market and luckily that time China stepped in and lend us a hand. A year has passed and our country has finally revived from financial crisis and many foreign countries started to accept the way how our Dr. Mahathir deals with the financial crisis. After a few years, Bank Negara Malaysia showed that the economy in our country has improved and our currency is now acceptable by the foreign country. This means that Malaysia finally survived from the financial crisis with the help of our prime minister, Dr. Mahathir. Conclusion As a conclusion, the way how our ministers build our country and save our country from many kind of crisis is a history and it should be remembered by every Malaysian. Without those leaders, our country will not have a better life like nowadays with how they fight for our independence from colony of British and save us from crisis. They had shown to the world how a leader should be like and the capability which must have in a leader. Without the leaders, our country, Malaysia will not become a strong country which brings a lot of contribution to the world. Besides, all kind of challenges which faced by our country has become our experience to make us a better country and try to maintain a good relationship between the multi-racial.