Why and How AirAsia is growing beyond what they're known for (a low-cost airline), and trying ways to become faster and leaner by growing beyond agile (leveraging also lean, open leadership, etc.), by helping their people grow beyond what they thought they could do.
Good morning. This is Eyob Faisal. He won the 2017 Venice Marathon, but he wasn’t supposed to win. The reason? The lead runners were following a motorcycle guide, and the motorcycle took a wrong turn, leading them off course. It’s ironic that this happened in Venice because when I was 12, I participated in a treasure hunt there. I was a fast runner, but I ran in the wrong direction—just like those marathon runners. However, I didn’t have the excuse of a misguided motorcycle.
What I learned from that experience is this: Speed without the right direction leads you nowhere. This lesson is crucial as I share three different transformation journeys with you today:
- The Journey of Vision: How we evolved our vision.
- The Journey of Execution: How we make things happen.
- The Journey of Leadership: How we, as leaders, connect with people and enable transformation.
Starting the Transformation
Before I dive in, I want to clarify—this is not a success story yet. We began our transformation in July, and we are still learning. We have discussed sharing updates along the way, and while you may see other leaders like Tony Fernandes or Irene Omar presenting in the future, today, I want to humbly share where we are.
I spent 20 years as a consultant at KPMG and Deloitte, primarily working with corporate clients. When I joined AirAsia, I was completely out of my comfort zone. In fact, when I came here yesterday, I was in a suit because I wasn’t sure if I could dress casually as I do every day at work. But AirAsia is different—it has a crazy headquarters that looks like a concert hall, complete with live bands playing while we try to work!
The Evolution of AirAsia’s Vision
Tony Fernandes started with a simple idea: He saw EasyJet in Europe and wanted to create something similar in Asia. His vision? "Now everyone can fly."
Seventeen years ago, he launched AirAsia with:
- Two planes
- 200 employees
- $10 million in debt
And just two days before September 11, 2001, which made it an even more challenging start.
Fast forward to today:
- We operate in seven countries.
- We cover Asia from Australia to China to India to Korea, and we are expanding to Hawaii, Europe, and the U.S..
- We have 250 aircraft and 22,000 employees.
- We have been profitable for most of these years.
- We have won Skytrax’s Best Low-Cost Airline award for ten consecutive years.
- Our brand is more recognized in Asia than Qantas, Singapore Airlines, or ANA.
Why Change When We Are Winning?
With this level of success, why change? There are two major reasons:
External Pressures
- Congested airspace and overcrowded airports.
- Air traffic control inefficiencies in countries like China and India.
- Talent shortages—not just pilots and cabin crew, but also digital talent.
- Digital disruptors—Expedia and online travel agents sell our seats but keep customer data to themselves.
Internal Pressures
- Success breeds complacency. Winning for ten years makes people confident, even resistant to change.
- Outdated processes—When you grow at 16% year-over-year for 17 years, your infrastructure and processes become misaligned.
- Project chaos—We often rush into solutions before understanding the problem.
The Transformation Strategy
We needed a compelling transformation narrative. Words like "Lean," "Fast," or "Digital" weren’t enough. Instead, we anchored ourselves in our roots:
- We are an airline.
- We are a low-cost airline.
- We have a massive network.
- We are growing digital businesses.
Our realization? We are no longer just an airline. We are becoming a technology company in lifestyle and travel. That requires a new way of thinking.
Executing the Transformation
Our CEO didn’t ask for opinions. He simply said: "Change or die." He pointed to companies like Fujifilm, Blackberry, and Nokia—giants that failed to adapt.
Our transformation focuses on three areas:
1. Better Projects
Instead of rushing into solutions, we start by understanding the value:
- What problem are we solving?
- Is it worth pursuing?
- Should we scale it?
2. Better Processes and Flow
We mapped and optimized processes like:
- Government billing—recovering $60 million in overdue payments.
- Refund management—reducing refund times to 24 hours.
- Procure-to-pay—currently in progress.
3. People and Collaboration
We are creating a space where:
- People meet regularly to align on priorities.
- Decisions are collaborative, not top-down.
- Teams understand the value chain across departments.
Final Thoughts
Transformation is not about pushing change. It’s about enabling people to drive change themselves. We are not just transforming; we are still running the business.
Our role is to:
- Involve customers and partners.
- Support executives in fostering open discussions.
- Empower grassroots leaders to step up.
Ultimately, we want to become a scaled insurgent—a company that maintains its startup mindset even as it grows. We do this by helping people grow and letting go.
Thank you.