AirAsia In The Press
22 December 2003 Source: Source: Business Times, NST
Fernandes pilots AirAsia to greater heights
AIRASIA Sdn Bhd chief executive officer (CEO) Tony Fernandes isn't surprised that he is often compared with Virgin Group founder and chairman Sir Richard Branson. They both have music flowing through their veins, and they both own an airline. They even know each other.
However, in an interview with Business Times, Fernandes said he and Branson are as different as chalk and cheese.
"Everyone thinks that I'm trying to emulate him. Big difference. He owns a record company (Virgin Records). I worked for one (when Fernandes was working for Virgin and Warner Music International's London office). The airline (Virgin Atlantic Airways) he runs is also different from the one we run," said Fernandes.
"He (Branson) is flamboyant while I'm not. He is not a hands-on manager while I am. He puts people to manage his businesses while most of the time my partners and myself manage AirAsia ourselves.
"He likes to start something new and then moves on to another when he gets bored. I mean he heads a company that offers everything from music to mobile phones, trains, personal finance and clothing. I just have this (AirAsia) and I can't see myself doing anything else for a long, long time, except as an investor," said Fernandes.
Still, he understands the comparison to Branson. "I think maybe it stems from the fact that Branson and I both share the same passion for music and having fun. Our management style is also different from other CEOs'," Fernandes said.
Since taking over the reins at AirAsia in 2001, Fernandes has become one of the most aggressive CEOs in the country. He has been named the joint winner of the CEO of the Year 2003 award by American Express Corporate Services and Business Times. The 39-year-old graduated from the UK in accountancy in 1987. It took a brief stint as an auditor with a firm in London for Fernandes to realise that he wasn't interested in becoming a full-fledged accountant. "I really hated the job, so six months later I left to join Virgin as a financial analyst and then financial controller in the company's television division in London, where I worked for two years," he recalled.
In the course of his work with Virgin he got to know Branson. "I was there when Branson started his airline (Virgin Atlantic in 1984). We all thought he was mad when he started it just as I think many people thought I was mad (when I took over AirAsia)," Fernandes said.
Fernandes then moved to join Warner Music in 1989 and was transferred back to Malaysia in 1999. Fernandes was 27 when he became the youngest-ever managing director of Warner Music (Malaysia) Sdn Bhd. His last serving role at Warner Music was as vice-president for the Asean region.
Two years later, Fernandes traded in his high-flying job for a chance to create his own low-cost carrier. He started a company under the name TuneAir Sdn Bhd in partnership with chairman Datuk Pahamin A. Rajab and directors Abdul Aziz Abu Bakar and Kamarudin Meranun; on December 8 2001, TuneAir officially acquired 99.25 per cent equity of 51.68 million shares from DRB-HICOM Bhd and took over AirAsia, Malaysia's second national carrier.
"I wanted to do that because I was fed up with the politics in the workplace and tired of working for others and being told what to do. I told myself, 'I am still young and if I don't start now it will eventually be too late. Even if it fails, I can always go back to being an accountant.
"And I don't want to look back 20 years from now and say, 'I should have tried it. It is better to try and fail, then not try at all. That's my philosophy," said Fernandes.
Fernandes said the idea of starting an airline came from him. "I had this desire to start an airline and I thought a low-fare airline would work very well in Malaysia.
So I went around and started putting the plans together. I roped in three partners - Datuk Pahamin, Aziz and Kamarudin, for starters. Datuk Pahamin helped arrange a meeting with then Prime Minister Tun Dr Mahathir Mohamad. "It was Dr Mahathir who said that he would rather us buy an existing airline than to start a new one. I think Dr Mahathir's vision was all about turning companies around as opposed to starting new ones. And it was the greatest thing that could ever have happened because one, AirAsia has a strong brand. Two, it was a good airline that DRB-HICOM started. Operationally, it is a safe airline, with good pilots and good staff. "So, we didn't have to go through the painful process of recruiting and training people. We had a working model from day one. We just had to change the strategy a bit."
Fernandes concedes that while he dreamt of owning his own airline ever since he was a young boy, "never in my wildest dreams had I thought it would come true".
"I always thought, come middle age, I'd be a corporate man. I didn't think I had the courage to be an entrepreneur because you can get pretty comfortable as a corporate man. For example, when I was at Warner Music, I flew first class all the time, was paid a lot of money, had a secure job and was moving up the corporate ladder. I never thought I would want to be my own boss. I didn't think I had the guts, to be honest," he recalled, laughing. Today, Fernandes operates out of a modest, unglamorous office space at KL International Airport in Sepang. He has no intention of moving out of his office or relocating AirAsia's headquarters to one of the office towers in Kuala Lumpur.
"Never. It will always be at the airport. If you run an airline, you have to be at the airport and this is one of the main reasons for our success:
"You've got to be close to your business. You've got to be able to talk to your guests (a term used by AirAsia to describe its passengers), see why there are flight delays and what's happening.
"You've got to keep your finger on the pulse. I think too many senior executives lose track of their staff and business by being too distant from where the real action is. If you build an elaborate headquarters in the middle of the city, people are tempted to spend a lot of time there, and it becomes really unproductive," Fernandes reasoned.
"But because I'm here (at KLIA), I live it, breathe it and see it. Admittably, it's not a great office. It's small and far away from the city, but I think we are successful primarily because of things like these."
Fernandes has also instilled a unique corporate culture that emphasises having fun. Thus, it is not surprising to walk into his office and find him deep at work with rock music blasting away. The 1,000-strong AirAsia staff also get to dress in smart casuals.
"It is a casual environment that we have here. I think we are the only airline where everyone shares the same office - pilots, cabin crew, engineers, personnel from marketing, finance and others, and this makes it a fun place to be in," said Fernandes.
Despite all his accomplishments, he remains humble and you can find his staff talking to Fernandes the same way they talk to their friends and colleagues.
Fernandes, who has no background in the airline industry, readily admits to not knowing everything. "Our fifth partner, who came from Ryanair, (director) Conor McCarthy, is very much my 'sifu'. And I learn from the staff themselves. "But most of the time, I learn by doing the job. I don't pretend to know everything. Stuff I don't know, I just ask. And there's no substitute for hard work," he said.
"I like being close to the operations. I enjoy working with people and half of my job is to motivate my staff. Because no matter how good I am, my staff are the ones who make me who I am," Fernandes said.
"We are only as good as the people below us. Without my staff, we are nowhere."
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