Well, It depends on if you listen to an outside Orang Puti Management consultancy, or if you are Bumi' and it's full speed ahead on the company expense account. The article beloww is from the Malaysian Star 29/05/01
Govt accepts recommendations for MAS overhaul
By B.K. Sidhu
THE government has accepted most of the recommendations of the Boston Consulting Group for a major shake-up of the management and business processes at Malaysia Airlines (MAS).
The recommendations include:
An overhaul of the senior management structure
Scrapping of several unprofitable routes
Revamp of the cargo division
Overhaul at the catering division
Consolidation of unprofitable subsidiaries.
According to the Boston Consulting Group report, the changes are necessary to return the airline to profitability and to restore the formerly strong international image of MAS.
The US management consultants are also recommending that MAS retains its domestic airline operations as these are crucial feeder services supporting its international routes.
Some quarters in the industry and government have suggested that MAS's domestic operations be hived off and transferred to another company because the domestic sector was a major loss centre for the national carrier.
Following the appointments in February of Tan Sri Azizan Zainal Abidin and Datuk Mohamad Nor Yusof as chairman and managing director respectively, MAS has entrusted the Boston Consulting Group to undertake a comprehensive study to identify the problems it was facing.
Azizan and Mohamad Nor were appointed by the government after it bought over the majority stake of 29.09% in MAS last December for RM1.79bil from Naluri Bhd, which is controlled by businessman Tan Sri Tajuddin Ramli.
The Boston Consulting Group report is believed to have been presented to Prime Minister Datuk Seri Dr Mahathir Mohamad recently.
"The aim of the shake-up is to ensure that the national carrier, which has been in the red for the last four years, returns to profitability, and its image restored," a source close to the airline said.
"If MAS continues to maintain the existing processes and management structure, the bleeding is not likely to stop," he added.
MAS is scheduled to announce its financial results for the full year ended March 31 later this week.
According to Multex Global Estimate, the consensus forecast of 21 research houses which cover the national carrier is for a net loss of RM676.2mil for financial year 2001. The airline posted a net loss of RM258.6mil in 2000.
Star Business understands that MAS is expected to announce a far bigger net loss of between RM1bil and RM1.3bil.
Following the restructure recommended by the Boston Consulting Group, the airline is expected to return to profitability in two years.
On the airline's routes, the source said several would need to be reviewed and some scrapped; the national carrier has thus far terminated its Kuala Lumpur-Haadyai and Kuala Lumpur-Chiangmai sectors