#Asia 3 lessons on building a great company from Air Asia’s CEO Tony Fernandes


At the APEC SME Summit, Fernandes talked about corporate culture, embracing data and tech, nurturing new talent and more


On Tuesday’s APEC SME Summit in Manila, AirAsia CEO Tony Fernandes took to the stage to explain “AirAsia’s Response to New Consumer Demands.” Not only did he manage to charm the audience with his casual witty humor, but also imparted three valuable lessons on how companies need to evolve to engage the new economy during his talk. Check them out.

1. On corporate culture and branding: Shake up old hierarchies

When Tony Fernandes bought Air Asia from the Malaysian government, it only had two Boeing jets and was US$11 million in debt. At the time, Air Asia only covered domestic routes and had a traditional legacy airline business model with 200 employees, as Fernandes recollected. Fernandes then decided to take action, shifting the company into a flat corporate culture, promoting accessibility to his staff and transparent communication.

“Too many Asian CEOs lock themselves in their offices,” justified Fernandes. “I would rather have 17,000 brains working for me than 10 guys telling me what is going on.”

Additionally, Fernandes had to rebrand Air Asia completely and also hire a new crew. He believes that when companies have to rebrand, they not only have to voice their branding externally but internally as well. “Branding is mostly internal branding, if the people inside your company don’t understand it, it’s [a] 50 per cent loss,” he said.

He too has his own ‘personal brand’ where he deliberately tries to dress up or “look worse than his staff” in order to continue promoting a flat culture and openness in communication with his employees.

Sometimes, Fernandes quipped, he dresses so badly that, “Malaysian Airlines thinks I’m an illegal immigrant.”

2. On talent and dreams: The biggest asset is the people of your company

As Fernandes had to hire a new crew, he believed that he needed to take unconventional action in finding the best and the brightest. According to Fernandes, he didn’t mind working blue collar jobs in order to spot new recruits and top employees.

One such ordinary Joe was an Air Asia bag carrier, who Fernandes encouraged to participate in the ‘first cadet’ programme. Fernandes saw brilliance in the boy, and true enough, this previous bag carrier is now captain of a brand new A320 Airbus. “My job is to turn raw diamonds into [polished] diamonds,” says Fernandes.

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When faced with sexist comments from Malaysian pilots that women can’t fly a plane, Fernandes retorted with, “If a woman can run a country, she can fly a plane.”

“Don’t let anyone tell you that you can’t do anything,” Fernandes said to the audience.

He told us an anecdote about how a female cadet pilot spoke to him about her dreams of participating in Miss Thailand. Fernandes allowed her to join the competition in 2005, and she won the title and represented Thailand in the Miss Universe competition, and eventually returned back to Air Asia as a captain. Fernandes now jokes how his is the only airline that has a Miss Universe candidate flying along with passengers.

“You can live your dreams. From some dreams come some reality. Don’t worry whether people at laugh at you. Because if you don’t dream you won’t get that opportunity.” he stated.

3. On innovation and customers: Data is king

During the talk, Fernandes also revealed the company’s new offering, Air Asia Mobile, and mentioned how technology is the future of the airline. He stressed that mobile innovation is crucial for SMEs and urged them to be more involved in technology. He noted that through technology, more data would be available to SMEs and that they should use this data in order to identify budgets and know their real customers.

When the talk came to the question and answer portion, one audience member asked for Fernandes’ opinion on ‘getting what you pay for’ as Air Asia is a low budget airline. The audience member recounted how he was stuck in a province for seven hours on an AirAsia flight. Despite his bad experience, however, the audience member still enjoyed flying on Air Asia.

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Fernandes was apologetic and said, “Complaints are free market research. Someone like you took the effort to tell us where things went wrong and how they should be improved. So I tell my guys to take these complaints very seriously.” Fernandes also awarded two free tickets to the audience member as well.

With the lessons Fernandes imparted, it’s no wonder Air Asia has quickly grown from two planes to more than 200 planes and still manages to receive recognition from its passengers to be the best airline. Today, Air Asia continues to expand and, according to Fernandes, has big plans for the Philippines very soon. Stay tuned.

Image Credit: Georgianna Carlos

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