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BUSINESSMAN OF THE YEAR

Piyasvasti gains title on his commitment

By Business Desk

The Nation

Proven commitment to financial turnaround, emphasis on international governance practices for the entire organisation, and defiance of political interference are the three qualities that earn Piyasvasti Amranand, president of Thai Airways International, The Nation's Businessman of The Year title this year.

With the qualities, he stood out among a list of candidates which include Kan Trakulhoon of Siam Cement Group which benefited largely from continued expansion and innovation; Thirapong Chansiri of Thai Union Frozen Products who further strengthened his frozen food empire with the acquisition of Britain-based MW Foods, owner of the John West brand; and Chanin Vongkusolkij of Banpu which struck one of the biggest merger and acquisition deals of Thailand through the US$2 billion acquisition of Australia's Centennial Coal and was the only Thai company making its way to Forbes Asia's list of top 50 Asia-Pacific companies.

In the job for just 14 months, excluding months of silently observing board of directors meetings prior to official appointment, Piyasvasti has amazed the business community with his extraordinary determination to make a difference. His acts are surprising despite his vow to hold this as the last job. To the former Energy Ministry, it was his pride to devote years before retirement to revive the golden era of THAI.

Before him, THAI was notorious for its deteriorating services and financial performance, not to mention corruption and nepotism. Weak management led to poor service and deteriorating customer satisfaction, as well as failure to adjust to new challenges.

Formerly a top-five airline, according to the Skytrax 2010 rankings, THAI is now one of 29 4-star airlines. It is lagging far behind six 5-star airliners: Asiana Airlines, Cathay Pacific, Kingfisher Airlines, Malaysia Airlines, Qatar Airways and Singapore Airlines.

Piyasvasti is thorough with his plans. When he took up the post, he vowed to restore THAI's image, to make it among the top 3 carriers in Asia and the top 5 in the world for overall customer experience. He knew this would take very hard work on the areas that resulted in low scores: the age of aircraft, dine-on-demand options, food quality, and inflight entertainment.

He and the management team came up with the business plan and strategies to improve the fleet. While refurbishment was the focus this year, the seven-year plan will see the fleet enlarge from 84 to 105 by 2017, paving the way for wider networks and higher revenues. With the introduction of new aircraft, the average fleet age will be reduced from 12.2 years - at Singapore Airlines it is 6.4 years, according to Airfleets.net. Coupled with refurbishment and inflight entertainment improvements, Piyasvasti is moving inches closer to his dream of improving the airline's competitiveness.

The 58-year-old's passion to improve the company's performance and image won him support from over 20,000 staff, not to mention his commitment to introduce good corporate governance to the organisation. Years of weak management had led to the board of directors running the organisation. Now, the appointment of vice presidents is within the authority of the management team, while the board considers only the appointment of executive vice presidents from a list of candidates submitted by the management.

Piyasvasti also put himself under internationally adopted KPI formula, something that none of his predecessors were subjected to. The performance relies on concrete criteria and targets, such as net profit, EBITDA and debt-service coverage ratio (DSCR), and third-party assessments of more qualitative aspects like customer satisfaction and management ability. The practices are applied from top to bottom as a way of realigning the rewards system to stimulate hard-working employees.

The new president has also won the support of the general public. This helped when he came up with the plan to create a super-low-cost airline, Thai Tiger Airways, in cooperation with Singapore's Tiger Airways. While Korn Chatikavanich, minister of the Finance Ministry that owns the majority stake in the national carrier, gave the management team a free hand, Transport Minister Sophon Saram posed pressing questions in the newspapers.

An insider admitted that Piyasvasti, formerly energy minister during the Surayud Chulanont administration and a widely respected energy official, wisely cut the deal before taking on this job. The Abhisit government is giving him a free hand, and thanks to Prime Minister Abhisit Vejjajiva and Korn's support, the row with Sophon - who is from the Bhumjai Thai Party - ended peacefully, for good.

Political interference was considered one of the factors tarnishing the airline's image. It filters into the company through the board of directors, most of whom are government officials. This significantly increased the board's role, when the management team was weak.

As Piyasvasti breathes new life into the airline, it is regaining stock analysts' attention. THAI successfully clinched deals to borrow Bt20 billion from commercial banks and succeeded in raising Bt15 billion from a public offering. THAI has witnessed a 127 per cent increase in share price from Bt21.80 on October 19, 2009 to Bt49.50 on Dec 17. The company's market capitalisation jumped 245.38 per cent from Bt31.59 billion to over Bt109 billion. This would largely please individual shareholders who kept bemoaning at shareholders' meetings that the price was much below Bt60 when THAI made the initial public offering.

With two years to complete his term, Piyasvasti admitted there is a long must-do list to ensure a strong and sustainable THAI.

He vows to move forward with introducing greater transparency to the management to fend off future interference and ease internal conflicts which resulted in poor appointments.

"I will contribute my best efforts to improving the company's image. THAI is a listed company and its image should look as good as others," he told The Nation.

-- The Nation 2010-12-20

[ginjag]

Top buisiness man of the year............Joke.........Compare airlines. Most people I know-who used to travel Thai--NOW travel--Emirates,Etihad,Eva,Jet/india,Qatar,..........These have relatively new aircraft, service,of good standard. But most of all----PRICE.................apart from promotions...the few I mentioned --ranges from 29k...to 35k.........into europe. in,flight entertainment, up to date--Thai near non existant........and their price--ask the Thai office. my last enquiry quote 49k return.......they have now got stuffy attitudes-and food provided is now of poor standard. I am speaking of coarse Economy.......as most people travel on.................what the well off gentry get for their B/1st class I wouldn,t know.......................Time to get your prices down Thai, I do believe you have new aircraft on order,,, are you not a little late ??????.....these airliners should have been ordered long ago.....average age fleet over 12 years. some of the 747 400s have been flying now near 20 years, maybe you could get some 707s to help out in the meentime.

[ianguygil]

Top buisiness man of the year............Joke.........Compare airlines. Most people I know-who used to travel Thai--NOW travel--Emirates,Etihad,Eva,Jet/india,Qatar,..........These have relatively new aircraft, service,of good standard. But most of all----PRICE.................apart from promotions...the few I mentioned --ranges from 29k...to 35k.........into europe. in,flight entertainment, up to date--Thai near non existant........and their price--ask the Thai office. my last enquiry quote 49k return.......they have now got stuffy attitudes-and food provided is now of poor standard. I am speaking of coarse Economy.......as most people travel on.................what the well off gentry get for their B/1st class I wouldn,t know.......................Time to get your prices down Thai, I do believe you have new aircraft on order,,, are you not a little late ??????.....these airliners should have been ordered long ago.....average age fleet over 12 years. some of the 747 400s have been flying now near 20 years, maybe you could get some 707s to help out in the meentime.

I think the point here is that he is there to turn around the operation and that this turnaround is still in process. Everybody I know who has worked with him in the past say he is an incredibly capable person. I had a problem on a THAI flight coming back from London in late October on business and complained and he got personally involved. So while the turnaround is in process, he is one of the few really qualified people who can pull this off. I flew with them internationally yesterday on a personal trip over the weekend and I agree they have a long way to go, the 747 must have been 18 years old or more, not comparable at all to SQ or CX or NH. But as they bring the new fleet onboard this will all improve. I flew one of their new 777 they leased from JET a few months ago coming back from Narita and it was excellent. So while his first priority was to stop the hemorrhage as they were losing so much cash. Now they are profitable. It is a standard turnaround story in any compay in any industry. We should give him time and our support as it is in all our interest for him to succeed. if we live in Thailand.

Edited December 20, 2010 by ianguygil

[samran]

Top buisiness man of the year............Joke.........Compare airlines. Most people I know-who used to travel Thai--NOW travel--Emirates,Etihad,Eva,Jet/india,Qatar,..........These have relatively new aircraft, service,of good standard. But most of all----PRICE.................apart from promotions...the few I mentioned --ranges from 29k...to 35k.........into europe. in,flight entertainment, up to date--Thai near non existant........and their price--ask the Thai office. my last enquiry quote 49k return.......they have now got stuffy attitudes-and food provided is now of poor standard. I am speaking of coarse Economy.......as most people travel on.................what the well off gentry get for their B/1st class I wouldn,t know.......................Time to get your prices down Thai, I do believe you have new aircraft on order,,, are you not a little late ??????.....these airliners should have been ordered long ago.....average age fleet over 12 years. some of the 747 400s have been flying now near 20 years, maybe you could get some 707s to help out in the meentime.

I think the point here is that he is there to turn around the operation and that this turnaround is still in process. Everybody I know who has worked with him in the past say he is an incredibly capable person. I had a problem on a THAI flight coming back from London in late October on business and complained and he got personally involved. So while the turnaround is in process, he is one of the few really qualified people who can pull this off. I flew with them internationally yesterday on a personal trip over the weekend and I agree they have a long way to go, the 747 must have been 18 years old or more, not comparable at all to SQ or CX or NH. But as they bring the new fleet onboard this will all improve. I flew one of their new 777 they leased from JET a few months ago coming back from Narita and it was excellent. So while his first priority was to stop the hemorrhage as they were losing so much cash. Now they are profitable. It is a standard turnaround story in any compay in any industry. We should give him time and our support as it is in all our interest for him to succeed. if we live in Thailand.

Would very much like to see some of the TV moaners go up against him....Piyasvasti would wipe the floor with them all with one hand tied behind his back (figuratively speaking of course).

He is probably one of the best brains around in business and academia, especial on energy matters whether it be in Thailand, Asia...the world. I doubt he will, but I'd love to see him enter politics.

[CharlieH]

Thai Air SUCKS ! , maybe this guy will make a difference but personally I doubt it very much, just another figure-head that looks good for PR on Thailand., typical stereo type.

[roiethome]

Sorry to be another negative comment, but on my last Thai Airways flight to Manila on 3rd December I completed a customer comment card as I have five complaints about the flight etc.

To date I have not received a response of even an acknowledgment.

Being a realist, I can guess that the card never made it off the plane except in the black rubbish sack.

Thai needs to concentrate more on fare paying passengers and less on board members who enjoy free trips for them and their family for life.

[ginjag]

Sorry to be another negative comment, but on my last Thai Airways flight to Manila on 3rd December I completed a customer comment card as I have five complaints about the flight etc.

To date I have not received a response of even an acknowledgment.

Being a realist, I can guess that the card never made it off the plane except in the black rubbish sack.

Thai needs to concentrate more on fare paying passengers and less on board members who enjoy free trips for them and their family for life.

It,s not another negative comment, your spot on, I was a customerin Thai early days of travel--well before the DC 10, The new man-brilliant or not--I was not knocking him. as one of the Thai business customer suggested. he just had a lovely business flight a few days ago. Thai think they are too good for the economy class. The good basic suggestions are overlooked--UNLESS you travel upper class. I have been a member for years, get red carpet treatment (economy) but alas do not use the old craft in operation, nothings too late for improvement, as a rule.......but Thai can only blame themselves.. they have had long enough to get sorted--but use profits on-board members-instead of new planes. You summed it up spot on ---roiethome

[ianguygil]

To chip in again.

The award was given to the man. All the criticism here is of the company, not the man.

To those of us who know him, even indirectly, he is clearly capable, honest, dedicated and determined. Nobody can expect him to turn such a large company around in 2 years, but he has made a definite start by reorganizing, setting direction, cleaning up (where required) and enabling those who are capable.

So disagreeing with this award given to Dr. Piyasvasti the person because the company still has problems makes no sense. To me at least. The person has not been born who could have completely turned this company around in such a short period.