What price Malaysia’s corporate reconstruction?
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Idris Jala: had to get big results fast |
It has made something of a celebrity of Idris Jala, the CEO appointed in 2005 in what he calls "possibly the worst and most difficult time in our history". In the first nine months of the 2005 fiscal year, the company had logged a M$1.3 billion ($370 million) loss. Continuing on that trajectory, it would have gone bankrupt by the middle of April 2006. Jala’s blueprint for revival was called the Business Turnaround Plan, unveiled in February 2006 with an immediate emphasis on survival, followed by profitability in 2007. Few gave it much chance of success, which made it all the more surprising when Malaysia Airlines beat its targets instead of ducking them. It was profitable by the third quarter of 2006 and has stayed that way, with all of the problems that so badly affected it in the past – low yield, inefficient network, low productivity and spiralling costs – dramatically improved. It has thus become the poster child of GLC reform, a symbol of what can be done with planning and effort.
