Last week, Tan Sri Dr Tony Fernandes was awarded Airline Executive of the Year by CAPA (Centre for Aviation) in Amsterdam. In giving this award, CAPA said, “AirAsia is back at the front of the pack and Tony has once again shown why he is one of the industry’s leading executives. The original short haul operations in Malaysia and Thailand are again among the most profitable airlines in Asia while losses in Indonesia and Philippines have been reduced. Long haul LCC AirAsia X is also back in the black following a restructuring.” I caught up with him to talk about comebacks, retirement, egos, music and of course, travel and Asia.
Q: What is it like to be back in the driving seat?
I was never out but yes, I guess I was kinda. Now I am more involved and enjoying it. In the gap, I was preparing for retirement, I had prepared second liners and that had taken pressure off me. But QZ8501 put things into perspective and I had to make sure that when I do retire, everything would be in good shape. (QZ8501 crashed into the Java Sea during bad weather, killing all 155 passengers and seven crew on board in December, 2014)
Q: Do you think that’s the burden of maverick entrepreneurs, strong leaders, like yourself? That you can’t ever let go because no one can ever replace you?
I really want to let go. My exit was premature at the time. We hadn’t fully grasped how complicated the ASEAN infrastructure is, underestimated the nationalism. I want to be like Alexander The Great and make them marry each other.
I have to step down some time – it cannot be right if I haven’t passed on the baton to someone and that someone makes it better. This is very important to me, it’s my baby, I can’t leave and let it fall apart.
Q: What did QZ8501 teach you?
Life is a blink. You blink and it changes. Live each day as it is your last – easy to say but hard to put that into reality.
Q: What’s your definition of retirement? In a recent blog post, Richard Branson wrote, “I don’t believe that retirement should be the goal.”
My definition is to be less hands on, more advisory, more chairman, more private equity, do things that I love to do without pressure.
It doesn’t mean do nothing. As (the late Singapore Senior Minister) Lee Kuan Yew said, “I have a brain which I should use. As long as you can contribute, you should.”
The clock has started though, it’s clearly in my head.
Tony Fernandes: “I don’t want to be like Tito – that when I step down, things fall apart.”
Q: What have you done to prepare for the day?
We’ve had a reorganization of AirAsia, we have appointed two Deputy Group CEOs (Bo Lingam, Deputy Group CEO, Operations and Rozman Omar, Deputy Group CEO of Corporate Services). We’ve begun the ASEANisation process – having our group head of communications from Indonesia, based in Jakarta (Audrey Petriny), and our Group Chief Financial Officer (Pattra Boosarawongse) is from Thailand. I am beginning the process of the one-ness of AirAsia.
All these steps are to ensure there will be a strong person to hold things together. I don’t want to be like Tito – that when I step down, things fall apart.
Q: Tell me about the one-ness of AirAsia.
A lot of airlines are identified by their nationality – Singapore Airlines, Malaysia Airlines. I want AirAsia to be the first true pan-Asian brand. Samsung is not pan-Asian. We want to be the Emirates of Asia. I mean one day, you could have a Chinese, Indonesian or Thai as head of AirAsia. Can you imagine a Thai being head of Singapore Airlines?
Q: They do say you’ve reach brand nirvana when people don’t really know or care where your brand comes from.
This is what I always tell my communications people. We are not from Malaysia, we are an ASEAN brand and in time, we will be an Asian brand.
Many years ago, I wanted to change the name to TuneAir and I was told it’d be a mistake. I am glad I listened. Your name can constrain you sometimes.
Q: So 15 years on, 60 million passengers, you’ve pretty much covered ASEAN. I assume the next growth will be from North Asia.
It’s going to come from everywhere. Indonesia is big, South-east Asia is big, so is North Asia. AirAsia X is bringing in new traffic. I don’t think we’ve covered all of ASEAN. Have you been to Raja Ampat? There is a lot more to ASEAN.
North Asia is not as easy as it sounds, governments are so entrenched, low cost airlines really need new thinking. It is no surprise low cost carrier penetration is so low in Japan, Korea and China – national carriers are so powerful there.
Q: You’ve had a bad experience in Japan, your joint venture was dissolved before it even took off. What lesson did you learn?
Never work with another airline again. We tried, with Malaysia Airlines and All Nippon Airways. I think it’s better working with friends – (Hiroshi) Mikitani of Rakuten is more like us. (Rakuten is one of the shareholders in the new AirAsia Japan which is due to be relaunched soon.)
Q: You’ve brought back Kathleen Tan, your former head of commercial, to run North Asia. What is your mandate to her?
Managed well, Kathleen Tan is a world beater. She’s got a huge amount of energy which if channelled in the right direction is powerful. Her mandate is to maximize our presence in North Asia, to have a unifying effect, to have a one North Asia.
Q: A lot of a CEO’s job is to manage people.
Yes, the important thing about leadership to not to believe your own press. We are all peas in a big pod.
My goal is, there is no one player but a full total football team concept. No one person is more important than the other, no one department is more important than the other.
Q: It’s about managing egos, isn’t it? You have a big ego too.
We can’t be successful without egos, the key is to manage it. Do I surround myself with people who always say yes to me? No. Humility is really critical. It’s not been difficult for me to set aside my ego. Yes I am opinionated but I believe in consensus. But if I believe in something, I will force it through. That’s what leaders do, that’s my prerogative.
I don’t think my ego has gotten the better of me. If it had, AirAsia may be called TuneAir today.
Q: Airlines are a very male-dominated industry at the top level. What’s your thinking on that?
Yes, it’s a male-dominated industry, and it’s poorer for it. We need people that are not driven by egos, that think logically, that don’t think of crushing people any chance they get. We have a good cross-section of alpha male and alpha females – our leadership positions are equally split between men and women.
We have 100 female pilots, Singapore Airlines does not have a single female pilot.
Q: You came from the music industry, which has been totally disrupted.
I left music because they didn’t agree it would be disrupted. I saw it coming, they wouldn’t embrace Napster. It has begun to happen with low cost airlines. Distribution has completely changed. People can find the lowest price in 10 seconds.
Q: What do airports need to do better?
We have to understand different types of customers, we need to separate shorthaul and longhaul, low cost and full cost airlines. Airports have improved their retail experiences but immigration and security are in the super dark ages and visas are prehistoric.
Q: If you could build your dream airport, what would it be?
We need a segmented airport – longhaul, premium, shorthaul, hub concept, low cost point to point.
Q: What’s next for you after you’ve built the one AirAsia brand?
Education and at some point, I want to build a cheap hospital. I love private equity, doing venture funds, helping kids out.