OPEN SYSTEM, CHANGE AND TRANSFORMATION
Malaysia Airlines (MAS) does appreciate an open system that offers powerful ways of thinking about strategy and organizational design. MAS adaptation to the environment is high in the sense that different environments favor different species of organizing based on different methods. MAS can be seen as a bureaucratic organization in a way. They tend to work most effectively in environments that are stable or protected in some way.





MAS emphasize the need of careful management to satisfy and balance their internal needs and to adapt to the environmental circumstances. People in the organization knew precisely what was expected of them and attended to their job responsibilities in a narrow yet efficient way. The firm was relatively successful in meeting the demands placed upon it, treating problematic situations as temporary deviations from the norm and doing whatever it could to stabilize its operating environment. This can be seen during the Malaysia economic turmoil. During this turmoil, MAS tended to abandon mechanistic approach; more flexible approaches were undertaken for successful operation. There were improvement in marketing strategy and cutting costs took place.


Meetings were a central feature, driving and dominating day to day work activities. Here jobs were allowed to shape themselves, the employees were appointed to the organization for their ability and expertise and were allowed and encouraged to find their own place and define the contributions that they could make. In this, we can see that MAS depends on achieving a balance or compatibility between strategy, structure, technology, the commitments and needs of people, and the external environment.


Change and complexity played a major role in MAS transformation. This can be seen in their transformation and restructuring the organization in meeting their goals. By the 1990s, Malaysia Airlines (MAS) had emerged as a major Asian carrier in the airline industry, with a fleet of 88 aircraft servicing more than 110 destinations across the world. The privatisation of MAS by the Malaysian Government began in 1985, when the government reduced its stake to 42%. In 1994, the government’s holdings in MAS were further reduced when a 32% stake was sold to a prominent Malay entrepreneur. Following this restructure, the new majority owner implemented a major re-organization of the airline’s operations and in the financial period 1996-1997, MAS recorded the highest profits in the history of the company. However, the Asian economic and currency crisis had adversely affected the regional airline sector, as typically 80% of airline operating costs were denominated in US dollars. Furthermore, declining regional passenger loads have resulted in fierce competition among the regional carriers. In an attempt to deal in part with the regional financial turmoil and the depreciation of the Malaysian currency, MAS was planning a controversial restructuring plan in May 1998.




TRANSFORMATION AND GROWTH

MAS began their program of change in 1994 triggered by an increased need to not only listen more carefully to what their customers wanted from the airline but also from the employees and to also respond more quickly.


They began an aggressive transformation program designed to craft a new organization and allow them to paint their future, as they see it- services, engineering, catering and cargo. They also began to introduce new, more customer responsive products and services through improved routes, more frequencies and an upgraded fleet.


These changes have improved their competitiveness and in four short years have put them at the forefront of their industry-poised to capture market share. The benefits of the ongoing transformation will continue to flow.


To manage this fast paced growth and accelerate change in their corporate culture, they had to refocus and change the mindset of their people. A series of intensive senior management development programs over the past 12 months have begun to sharpen the skills and acumen of their core teams. This resulted in a workforce focused on being the best and delivering constantly improved products and services for their customers.


To increase their momentum and capture the benefits in such a demanding but fertile environment, they will continue to change and evolve through constant review and effective deployment of resources.


At the heart of their change is the acceptance that they must provide the product quality and the service standards that exceed their customers\' expectations.


HUMAN RESOURCES DEVELOPMENT



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