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Essay / Ryanair Company Case Study
Ryanair is an Irish low-cost airline with a significant share in the European airline industry. The airline provides good services to its customers and has a significant share of the international market. This case study will analyze all the factors that can affect the development and progress of the company and also recommend certain strategies to improve the current state of the company. The main problems Ryanair faces are poor corporate image and most revolve around low costs, poor customer services and ecological damage to the environment. The SWOT and TOWS analysis for Ryanair is also presented in this case study. Additionally, the strategic options, proposed strategic plan and SAF analysis are also presented along with the conclusion and recommendations at the end of the study. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get the original essayIntroductionRyanair is a famous and leading low-cost airline which has introduced new low-cost packages in the airline industry. The airline was founded in 1985 by the Ryan family with the aim of providing low-cost scheduled passenger services between Ireland and the United Kingdom. The airline aimed to operate as an alternative to state monopoly Aer Lingus. Over the years, the airline has undergone drastic changes since its founding in 1985. Ryanair CEO Michael O'Leary has adopted the Southwest Airlines business model of low costs and strong leadership. Ryanair's strong leadership is famous around the world. However, the airline is experiencing inconsistencies in areas such as poor customer service and poor working conditions. In recent years, Ryanair has improved its services, improved its image and introduced the necessary changes to attract more passengers and customers. SWOT Analysis The strengths, weaknesses, opportunities and threats (SWOT) analysis of Ryanair is presented below. factor)The brand name of Ryanair is its strength itself. Ryanair has always provided customer facilities with low costs and high levels of punctuality. The punctual service provided by Ryanair is a plus for this airline. It is the largest airline in Europe and carries more passengers than other airlines in this region. Ryanair's presence in European markets acts as a defensive system against competing airlines. The low cost of the ticket is due to its large size, as they can exploit economies of scope and scale. The online flight ticket booking system is also a great advantage for this organization. The young staff and crew members are also one of its greatest strengths. Customers can purchase their tickets without paying extra money to agents. Expenses are controlled by Ryanair's bargaining power due to its large presence. The large size of the airline, i.e. 16,000 routes in 30 countries in Europe and North Africa, 69 bases for Ryanair planes and crews and around 186 airports, ultimately make this airline a strong icon on the market.Weaknesses (internal factor)Despite the Although Ryanair has a good position in international markets, there are many threats that can affect the airline's capacity. Ryanair's profits are very seasonal and the increase in profits depends on the strong northern hemisphere climate. As summer approaches, from July to September, the benefitsincrease while during winters, from October to March, profits decrease. The company is facing a big loss due to these seasonality issues. Additionally, poor customer service and awkward service agreements such as an ambiguous baggage policy and other unfair pricing practices for increased revenue are hurting its position. Additionally, the airline's growing presence in the UK market has led to Brexit-related risks for the organization and as such, the owners have decided to focus on Europe to combat this weakness in the UK. future.factor)In 2013, Ryanair focused on improving its customer service to improve the quality of customer interactions with the airline. The attractive new website and booking in just a few clicks strengthen the airline's strengths. Plus, the new app, loosened baggage restrictions, and new seats make it a good airline. To improve customer service, Ryanair has also launched its business class and also has many features such as fast lane service, booking flexibility, one-time fees. features and a choice to reserve the seat in premium rows and check the bed. More major airports are added to Ryanair to improve its services. Ryanair also plans to add around 100 Boeing 737 MAX200 aircraft to its airline fleet. The aircraft will have 197 seats and will be operational after 2019. The seats in the current aircraft are 187. Increasing the fuel efficiency of the aircraft will also increase profits by 18% and reduce noise pollution by 40%. .Threats (external) factor)Accidents are the main threat to any airline. Ryanair's track record shows that it has a strong safety record. There are fewer suggestions for improving safety, but Ryanair has a strong image and is continually developing its plans. However, a loss of focus on the part of one of its executives could harm its balance sheet. The real threat lies in the incursion into Irish rival Aer Lingus. This would pose a major threat to the airline as the new airline's business model, fleet and network were not the optimal business option. Competition regulators and the Irish government have threatened the attempt. Other airlines are not able to compete with Ryanair on price due to its unit cost level. However, other areas such as the quality of the airport and the level of customer satisfaction with these changes may threaten Ryanair. Moreover, with the ambitious growth plan, external factors such as fuel prices, currency movements and terrorist threats are still risk factors for the airline. TOWS AnalysisThe analysis of Ryanair's tows gives recommendations to increase its capacity in all aspects.SOR Strategyyanair must carry out its next project of purchasing a hundred new aircraft and increasing its 146 routes that the company has decided to launch in 2010. Further expansion can increase the company's role in the market to achieve the target and it can use it to further decrease its fair. Additionally, Ryanair should use its young staff to improve its customer service and give a good image to customers. Additional revenue can be generated by increasing sales on the attractive website. Strategy ST Ryanair should continue to buy new planes. Rising fuel prices always represent a risk for airlines. The new planes are energy efficientfuel and save a lot of fuel, thereby increasing profits. If fuel prices increase, the airline will compete in a healthier and more profitable regime. Airplanes are also environmentally friendly because they are quiet and emit less pollution. The economic influence of the airline can help in this situation. When others raise their prices, that airline's low costs can significantly increase its profits. WO StrategyIn order to overcome the airline's poor image resulting from poor customer service and controversial advertisements, Ryanair must engage in dialogue with customers. and unions. Successful dialogues should be made public through advertisements. There must be a comment box for the customer's complaint and the company must take cognizance of the complaints by investigating and responding to them in an efficient and diligent manner. WT Strategy The public image of the airline must be optimized. The airline's poor customer services need to be improved and safety risks eliminated. To relieve staff pressure, new qualified staff should be hired. Strategic OptionsPorter's generic strategies are given by Michael Porter who wrote a book on competitive strategies widely used in strategic management. According to Porter, competitive strategy is the tool for assigning appropriate competitive positions. Companies are built and destroyed based on their alternative strategies. Michael Porter's conceptual model was based on three main categories: differentiation, focus and cost leadership strategy. In the model, Michael Porter compares successful and unsuccessful business organizations. If the company does not fit into the strategies established by the Porter model, then it is unable to compete in the competitive environment (Porter, 2014). Cost Leadership Cost leadership strategy represents the activity of the organization in keeping its costs low and giving the best in low cost within the industry. In this case, due to its low cost, Ryanair has attracted many customers traveling to Europe from point A and point B. With the recent recession and other factors, customers are opting for the cheapest option to provide better quality service. At the beginning, Ryanair was a normal airline with the same lounges and prices. However, the company cut costs keeping in mind the external recession. Therefore, the airline is facing problems in moving from being a high-cost airline to becoming Europe's best low-cost airline. DifferentiationDifferentiation strategy is also good for the company as it uses technology heavily. There are some problem areas associated with this strategy, including estimating the additional cost, which can be recovered from the customer through high prices. A successful differentiation strategy works if the company introduces a different product. Ryanair has already suffered losses and so the CEO is adopting the policy of American Southwest airlines. However, Ryanair's strategy in this matter remains unclear. The low cost policy has greatly contributed to differentiation as well as cost leadership and thus the airline has become a major player in the air services sector. Ryanair's use of secondary airports helps keep its prices low. FocusFocus is also one of three.