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Case Garuda Indonesia Essay

In spite of the rapid growth in both passengers the traffic and fleet during the oil boom of the 1970’s, thus making it the “largest airline in the Southern Hemisphere”, Garuda, as it was known then, had been plagued by a bad reputation as well as heavy losses year after year. Having been a member of Mr. Lumenta’s management team of Garuda since November 17, 1984, Mr. Soeparno had the opportunity to involve himself with the management in its efforts to develop and implement new strategies to turn around the airline, which posted a net loss of U.S.$7 million in 1984 (exhibit 9), into profitability.

He was therefore very pleased to see the company making a profit for the first time in more than a decade, to the tune of a modest rupiah 300 million (exhibit1). This result confirmed Mr. Soeparno’s confidence in the effectiveness of the policies adopted by Mr. Lumenta upon the latter’s appointment as President Director of Garuda in 1984. As the newly appointed President of Garuda, Mr. Soeparno is caught in the middle of a dilemma of whether to continue Mr. Lumenta’s successful policies or to formulate a new set of policies which would enhance the company’s ability to deal with the challenges it may face during his term and beyond.


The weaknesses of their system were the manually produced passenger tickets and failure of reservation system.


a. Strength
• Good management
• Their business was expanding
• Higher Economic growth
• Biggest airlines in the Southern Hemisphere

b. Weakness
• System weakness
• Not customer oriented

January 6, 1988


On January 6, 1988, Mr. Mohammad Soerparno (50) was appointed by the

c. Opportunities
• Better condition of world’s economy
• The progress in business climate in Indonesia

d. Threats
• Uncertain economic situation
• Increasing competition


Mr. Lumenta is a very hardworking and a responsible business man. He is a role model of the business industry, he find ways to settle the problems of the company, maintaining the stability the airlines is his one objective. Maintaining the stability of a company is not that easy, they encounter up’s and down. But in the case of the Garuda Indonesia they are the most prestige airlines in the country, they are the top among their competitors.


I have therefore conclude that the best solution to the problem is In every business, negative and positive feedback of customer is always there. It is one of the reasons why company’s relay’s on their feedback, to know what the other ways are their going to accomplish just to satisfy their customer wants. Satisfying customers is one of the important, because your business cannot stand alone without them. Through them your business will evolve. As a recommendation, in order for that your customer will be sincere in your company you should show nice treatment to him, always prioritize you customer and new offers or new environment is one of the reason why customer is always constant to your company.

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