Kingfisher Airlines - Managing Conflicting Stakeholder Interests

Session 1: Kingfisher Airlines- Managing

Conflicting Stakeholder Interests

By- Group 1

Archita(191)| Avishek(196) |Gagandeep(200),

Rahul(201)| Miranda(207) | Prachi(214)

Q2: Which of the stakeholders were engaged more than others, whose interests seemed to be guarded and whose ignored?

• Kingfisher’s failure can be attributed to the company’s inability to meet threshold level of satisfaction of all stakeholders. Some stakeholders were very well served, on the other hand, others were completely ignored.

– Customers : Kingfisher was known for the quality of service to customers. Personal screens, King Club, lounge facilities were things that Indian flyers had rarely witnessed. This helped the company gain loyal customers, who were relatively the most satisfied stakeholders.

– Suppliers : Major stakeholders including suppliers of financial resources, fuel, leased aircraft- were dissatisfied by the delayed payments and many wanted to disengage

–  Employees : Delayed salaries, facing incensed customers. Led to many resignations 

– Community : Safety implications due to cannibalization of grounded flights. Taxes deducted from employees salaries not paid to tax authorities.

–  Owners : Shareholders lost confidence due to declining share prices 

The biasness and mismanagement of stakeholders led to the decline of Kingfisher. This reflects the importance of effectively managing conflicting stakeholders’ interest in order to ensure their continued engagement and support.

Q4: Why did Vijay Mallya act the way that he did? How can organization avoid the situation that Kingfisher finds itself in today?

• Why did Vijay Mallya act the way that he did?

– Vijay Mallya believed that both ultra luxurious experience as well as cheap pricing could be provided together. However what he didn't realize was that it would not pay off in the long run in the Indian airlines industry

– Also he may have thought that the govt. would provide support to Kingfisher by means of subsidies and hence short term risk can be taken

–  He believed that help was round the corner even when bank denied him loans.