MH17 crash: Three challenges facing Malaysia Airlines

By on July 21, 2014

The crash of its second airliner this year represents a catastrophic potential crisis for Malaysia Airlines.

After the disappearance of flight MH370 in March, Malaysian flag carrier Malaysia Airlines was already in dire straits: the company posted first-quarter figures showing a R1.46 billion loss in the three months to May, while shares have fallen by 75 percent in 12 months.

Now the unthinkable has happened: It lost its second plane this year. While the company has responsibility above all to the families of the victims and investors – particularly those rumoured to be planning to buy the airline off its government owners – will closely watch its handling of the crisis to determine its future.

Tim Johnson, the Chief Operating Officer of crisis management firm Regester Larkin, which has advised airline clients such as British Airways and Tui Travel, explains the challenges facing the company now.

1. What is the airline’s future?

“In a crisis situation, there’s something broken about the future; the future you thought might happen is now challenged. You’ve got a choice, as an organisation you can attempt to repair that link to the future, or you can create a new future. That’s one of the biggest strategic decisions a leader will have to face. [In this situation] a new future needs to be considered.”

2. What to focus on now

“First and foremost, the company needs to focus on the families. It needs to be seen to be sparing no expense to support them. But the second priority needs to be to ensure this crisis doesn’t become a distraction, ensuring the safety of ongoing operations.

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There has to be a part of the organisation that focuses on the integrity of what it’s doing.”

3. Communication

“When it comes to communication, there is a defining set of characteristics to follow: Tell it all, tell it fast, and tell it as truthfully as you possibly can. Always demonstrate concern, control, and a commitment to ensuring that whatever lessons can be learned are.

“Because of social media, the logistics of executing that well become ever more difficult. There’s a need for speed – it’s very hard for organisations to match that. But not to match it may lead to longer-term distress. So the organisations at the heart of these things know they need to get things out quickly. That can be tough.”

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