1.0 INTRODUCTION
Industrial Centre of Excellence (ICOE) is undeniably crucial in developing human capital and
academic growth in Malaysia. With this current race of global technology development, our
country has to keep up the pace in order to compete and not to be left behind. ICOE gives
opportunity for students and trainees to enhance the skills prior to the career environment.
Aviation Technology Hub is seen to has the potential of becoming a renowned ICOE as well
as providing necessary training platform to the trainees who are interested into aviation line of
courses.
Malaysian Ministry of Higher Education in the National Higher Education Strategic Plan 2020
emphasized on sustainability of education system. One way to sustain the academic system in
Malaysia is having ICOE as the medium to provide practical learnings. With the rapid growth
of aviation development, KLIA Aeropolis is definitely not an exception to be on the road for
worldwide competitions. Being one of a very few aviation hubs in Malaysia, it is an opportunity
to strive for a global competition rather than focusing within the nation league. However, the
main objective of transforming into an ICOE is to exploit chances for trainees to learn and
enhance the job-related skills preparing for future aviation jobs. Competitions are somehow
necessary in order to sustain the industry in a long run.
One challenge that is faced by all industries worldwide including Malaysia is regarding the
pandemic of COVID-19. Figure 1.1 below shows the significance decline of passenger on
flight demands from 2018 until 2020. The drop is due to the global containment initiative of
recent pandemic which causing travel restrictions.
Figure 1.1: Passenger flight demand 2018-2020 in Malaysia aviation
,COVID-19 has impacted the overall economic status of aviation industry to cover the loss costs
annihilated by travel restrictions. This has resulted in increasing of fares, rate of unemployment
and number of flights reduction. As to develop ICOE within KLIA Aeropolis, these factors
have to be addressed as it may impact the interest of potential students as well as the process
of growing this industry will be stunted over time.
Despite having a declination towards commercial flight demands, MAVCOM1 in the
Economics Waypoint Outlook of June 2020 has emphasized on the importance of air cargo
demands during the pandemic. The demands grow due to online shopping and transactions
with no international barriers. Refer Appendix A for the statistics.
This is also proved that the opportunity can be enhanced for greater development. With the
demands in air cargo, the new implementation of passenger seats reduction to avoid the spread
of COVID-19 and total flights reduction, the aviation technology exhibits potential
development in the future. This includes research and new productions of advance aircrafts,
remodelling of the older version’s aircrafts and highly skilled manpower. The growing
potential in aviation technology is considered infinite as the designs will be changing every
few years. This is definitely demanding the upskilling and reskilling of the workers in order to
comprehend the technology. ICOE is seemed to be the best initiative to separately using the
hub to provide the training for those who are interested to further their careers in this industry.
With this ICOE transformation, KLIA Aeropolis not only will be able to provide opportunity
to the locals to learn the necessary aviation related skills but also to prepare the industry to face
the potential competition emergence.
This proposal report will emphasize on the strategic management of how KLIA Aeropolis can
be transformed into ICOE for sustainability and growth as the Aviation Technology hub in
Malaysia. All key aspects regarding the strategic management will be discussed thoroughly
throughout this report.
1
Malaysian Aviation Commission
, 2.0 RESEARCH PROBLEM
This section will be discussing on the problem definition which is the main area of concerns
regarding the proposed transformation idea. This will include some challenges that are faced
by the industry as well as the analysis methods chosen, the SWOT analysis.
2.1 CHALLENGES
One major challenge is regarding the economic factor especially during this pandemic
attack. In order to develop the industry, certain costs such as for research, development
and productions are needed for sustainability. Transforming into a training centre in the
aviation technology industry demands relatively higher costs especially for the aircrafts
themselves. Not to mention, qualified trainers are also required for training
development. In addition, the aircraft designers and manufacturers will keep changing
the models for enhancement and upgrades suitable to the technology development
which will result in an increasing market prices of certain parts as well as the overall
aircraft. Without sufficient funds, there will be a delay in importing the newer versions
of the aircraft technology into the industry. This will somehow stunt the progress of
exploring latest technology which is crucial if the agenda in long-term is to compete in
global competition.
Another challenge is regarding the uncertainties of future fate in this industry. This is
something that is unpredictable but needs to be addressed as potential threat. The
uncertainties are involving the global pandemic, global economy and the profit of this
commercial airlines. In proposing this transformation, these uncertainties need to be
included to prepare for the worst-case scenario. Just for example if COVID-19 is
worsening, this will somehow put extra declination towards the industry until it reaches
the point of where no one will be interested to invest into the aviation industry anymore.
The uncertainties are also reaching to the unknown upcoming years and this is not
healthy for a long development and sustainability of the industry.
Industrial Centre of Excellence (ICOE) is undeniably crucial in developing human capital and
academic growth in Malaysia. With this current race of global technology development, our
country has to keep up the pace in order to compete and not to be left behind. ICOE gives
opportunity for students and trainees to enhance the skills prior to the career environment.
Aviation Technology Hub is seen to has the potential of becoming a renowned ICOE as well
as providing necessary training platform to the trainees who are interested into aviation line of
courses.
Malaysian Ministry of Higher Education in the National Higher Education Strategic Plan 2020
emphasized on sustainability of education system. One way to sustain the academic system in
Malaysia is having ICOE as the medium to provide practical learnings. With the rapid growth
of aviation development, KLIA Aeropolis is definitely not an exception to be on the road for
worldwide competitions. Being one of a very few aviation hubs in Malaysia, it is an opportunity
to strive for a global competition rather than focusing within the nation league. However, the
main objective of transforming into an ICOE is to exploit chances for trainees to learn and
enhance the job-related skills preparing for future aviation jobs. Competitions are somehow
necessary in order to sustain the industry in a long run.
One challenge that is faced by all industries worldwide including Malaysia is regarding the
pandemic of COVID-19. Figure 1.1 below shows the significance decline of passenger on
flight demands from 2018 until 2020. The drop is due to the global containment initiative of
recent pandemic which causing travel restrictions.
Figure 1.1: Passenger flight demand 2018-2020 in Malaysia aviation
,COVID-19 has impacted the overall economic status of aviation industry to cover the loss costs
annihilated by travel restrictions. This has resulted in increasing of fares, rate of unemployment
and number of flights reduction. As to develop ICOE within KLIA Aeropolis, these factors
have to be addressed as it may impact the interest of potential students as well as the process
of growing this industry will be stunted over time.
Despite having a declination towards commercial flight demands, MAVCOM1 in the
Economics Waypoint Outlook of June 2020 has emphasized on the importance of air cargo
demands during the pandemic. The demands grow due to online shopping and transactions
with no international barriers. Refer Appendix A for the statistics.
This is also proved that the opportunity can be enhanced for greater development. With the
demands in air cargo, the new implementation of passenger seats reduction to avoid the spread
of COVID-19 and total flights reduction, the aviation technology exhibits potential
development in the future. This includes research and new productions of advance aircrafts,
remodelling of the older version’s aircrafts and highly skilled manpower. The growing
potential in aviation technology is considered infinite as the designs will be changing every
few years. This is definitely demanding the upskilling and reskilling of the workers in order to
comprehend the technology. ICOE is seemed to be the best initiative to separately using the
hub to provide the training for those who are interested to further their careers in this industry.
With this ICOE transformation, KLIA Aeropolis not only will be able to provide opportunity
to the locals to learn the necessary aviation related skills but also to prepare the industry to face
the potential competition emergence.
This proposal report will emphasize on the strategic management of how KLIA Aeropolis can
be transformed into ICOE for sustainability and growth as the Aviation Technology hub in
Malaysia. All key aspects regarding the strategic management will be discussed thoroughly
throughout this report.
1
Malaysian Aviation Commission
, 2.0 RESEARCH PROBLEM
This section will be discussing on the problem definition which is the main area of concerns
regarding the proposed transformation idea. This will include some challenges that are faced
by the industry as well as the analysis methods chosen, the SWOT analysis.
2.1 CHALLENGES
One major challenge is regarding the economic factor especially during this pandemic
attack. In order to develop the industry, certain costs such as for research, development
and productions are needed for sustainability. Transforming into a training centre in the
aviation technology industry demands relatively higher costs especially for the aircrafts
themselves. Not to mention, qualified trainers are also required for training
development. In addition, the aircraft designers and manufacturers will keep changing
the models for enhancement and upgrades suitable to the technology development
which will result in an increasing market prices of certain parts as well as the overall
aircraft. Without sufficient funds, there will be a delay in importing the newer versions
of the aircraft technology into the industry. This will somehow stunt the progress of
exploring latest technology which is crucial if the agenda in long-term is to compete in
global competition.
Another challenge is regarding the uncertainties of future fate in this industry. This is
something that is unpredictable but needs to be addressed as potential threat. The
uncertainties are involving the global pandemic, global economy and the profit of this
commercial airlines. In proposing this transformation, these uncertainties need to be
included to prepare for the worst-case scenario. Just for example if COVID-19 is
worsening, this will somehow put extra declination towards the industry until it reaches
the point of where no one will be interested to invest into the aviation industry anymore.
The uncertainties are also reaching to the unknown upcoming years and this is not
healthy for a long development and sustainability of the industry.
