IT IMPLEMENTATIONS AND STRATEGIC ALIGNMENT In todays globalize economy, information technology has driven fundamental changes in the nature

andapplication of technology in business. The implementation of information technology in its value chain providespowerful strategic and tactical tools for AirAsia, which if properly applied and used, could bring great advantagesin promoting and strengthening the competitive advantages. CURRENT STRATEGIC IT IMPLMENTATION AirAsia has currently adopted information technologies strategically to integrate the operations and coordinate allthe business and management functions. The followings are few system implementations that AirAsia has done inits marketing and sales activities as well as operation activity in the value chain. Yield Management System (YMS) Anticipates and reacts to the behavior of customers to maximize the revenue - taking into account theoperating cost and aids AirAsia to optimize prices and allocate capacity to maximize the expected revenuesby 2 levels: a) Seat Seats are available at various prices in different points of time. A reservation done at a later datewill be charged more than the one done earlier for the same seat b) Route By adjusting prices for routes / destinations that have a higher demand when compared to others. Results increased revenue (3-4%) by taking advantage of the forecast of the high / low demand patterns,lower prices as YMS has aided AirAsia to increase the revenue by offering higher discounts, more frequentlyduring off-peak times while raising prices only marginally for peak times. Computer Reservation System (CRS) An integrated web-enabled reservation and inventory system suite powered by Navitaires Open Skiestechnology that includes Internet, call center, and airport departure control functionality. Satisfy the unique needs of AirAsia implementing a low-cost business model to transform the businessprocess to efficiently streamline operations. Helps AirAsia to grow at a dramatic pace in the past few years as stated below: "Navitaire's Open Skies technology has truly enabled AirAsia's growth from 2 million passengers to 7.7 million passengers in less than two years. Open Skies scaled easily to accommodate our growth." - Tony Fernandes,CEO, AirAsia Enterprise Resource Planning System (ERP) An integrated ERP solution powered by Microsoft Business Solutions (MBS) on Microsoft technologyplatform which is implemented by Avanade consultants in Ma 2005.

With the robust ERP technology platform, AirAsia is able to successfully maintain process integrity, reducefinancial month-end closing processing time, speeds up reporting and data retrieval process.

SWOT analysis Strengths Low cost operations Fewer management level, effective, focused &aggressive management Simple proven business model that consistently deliversthat lowest fares Penetrate & stimulate to potential markets Multi-skilled staffs means efficient & incentive workforce Single type fleet minimize maintenance fee & easy for pilot dispatch

Weaknesses Service resource is limited by lower costs Limited human resources could not handle irregular situation Government interference & regulation on airport deals andpassenger compensation Non-central location of secondary airports Brand is vital for market position & developing it is always a challenge Heavy reliance on outsourcing

VALUE CHAIN ANALYSIS

PRIMARY ACTIVITIES Inbound Logistics Flight & crew Scheduling Flight reservation Route select Pricing Fuel Aircraft acquisition Spare part acquisition Catering Operations Courier operation Gate operation Aircraft operation Baggage handling On-board services

PRIMARY ACTIVITIESOutbound Logistics Ground shuttle service Baggage claiming Marketing & Sales Integrated marketing communications Services Lost & found service Follow-up on customers feedback

SUPPORT ACTIVITIES Firms Infrastructure Board of Directors Accounting Legal Finance Planning Quality assurance Government relations Human Resource Management Flight analyst training Yield analyst training Pilot training Safety training Baggage handling training Product development

 Market research In-flight training

SUPPORT ACTIVITIES Technology & Development Computer reservation system Flight scheduling system Yield management system In-flight system Baggage system Database marketing Digital marketing Call centre Baggage tracking system Procurement Technology acquisitions http://www.scribd.com/doc/100110300/AirAsia-Group-Project-final-140612