Ryanair Case Study

Ryanair was established in the year 1985 by the RYAN family and has grown from a small airline flying a short hop from Waterford to London, into one of the Europe’s largest carriers. The company expanded and within 4 years it had 350 employees, 14 aircraft, and carried 600,000 passengers a year. It is currently serving to 26 European Countries with 148 destinations. It operates on 794 different routes daily serving by more than 1050 flights in a day. It has totally 169 aircrafts running for different routes with 5986number of employees working in it However, Ryanair’s costs rose drastically and it recorded losses of £20 Million sover four years despite its growth. Although consumers were continuing to fly Ryanair

As can be understood from the analysis given below, if British Airways can cut it’s staffing by 25%* and increase it’s utilization to 90% from 60%, it shall be able to reduce the prices significantly to I£104, still I£6 more than Ryanair. As British Airways is a renowned market leader, people would be inclined to travel by British Airways by paying the I£6 extra than by a relatively unknown carrier Ryanair. Also, such a reduction in tariff on all of BA’s routes might not be necessary. It can very well position separate flights/routes for this rate so as to offset any reduction in utilization through profits in other routes.

A unique cost cutting policy would be the main core competence of Ryanair. It refuses to provide any meal vouchers or hotel accommodation for flights which are delayed or cancelled for reasons beyong Ryanair’s control in order to reduce the operating cost. (Ryanair, 2011) Meanwhile, Ryanair is using LFA business model to design the size of its

The strategic plan of Ryanair has been to establish itself as Europe’s leading low-fares airline.” Ryanair aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.” (www.ryanair.com)

Generally speaking, the launch strategy of Ryanair was not the best one for that moment in time. They began operations between Dublin and London, in a very saturated market, which was already served by two competing and very experienced companies owned by the governments:

Ryanair, originally an Irish low-cost airline and established by the Ryan family in the year of 1984 starting off with only 25 members of staff. Replicating the American Southwest airline business model and then officially relaunched in the year 1990. It has vastly grown from being a single-aircraft family operation into one of the world’s top leading airlines. Now Ryanair has reached 11,458 employees. The airline carries over 131 million passengers per annum on over 2,000 flights daily, from 86 different routes, flying to more than 205 destinations in 33 countries.

In this individual assignment, reading material including the different ways companies innovate, re-energize a mature organization, and change corporate culture provide the basis for analyzing British Airways’ (BA) transformation and the difficulties encountered in making an organizational change. Identification of critical factors leading to British Airways successful transformation as well as steps, sequence, and risks taken to transform the organization and personal assessment is provided for this case study.

Recently, there have been many problems across Europe that may affect the number of passengers across Europe. Firstly, this is about the political friction between the countries such as Germany and Turkey. Similarly, the political troubles, including the rise of the far-right parties can be considered a major barrier towards fast development.

Prior to 1991, Ryanair had suffered from continuous losses from 1985 to 1989. The first reason that put it into this situation was that it tried to position itself as a low fare airline with the first rate services. It tried to keep low and unrestricted fare, while keep focusing on the best customer service and relationship. This mixed model was proven inefficiency. The low price could lure number of

British Airways is the one of the largest airline companies, and the passengers carry overall in the fifth largest in the world. Most of plans are stay in Heathrow Airport which is the highest of main international airport. The British Airways has a long history and airlines cover 133 countries; include 373 airplanes. The BA Company includes 50,086 workers to be in the service, which is one of the largest employers and employees in the United Kingdom.

Ryanair incorporated at no-frills, low-cost, quick to reach consumers destinations in a much modernized aviation industry. For instance, it is more cheaply, and more reliable, than any other airline including British Airways. They do not compromise on safety, top-drawer punctuality, near perfect baggage handling and efficient ‘green’ policy. The target markets of this particular airline are those who compromises on comfort and fare conscious customers. For example: Students, low-income earners, busy businessmen, and family (Ryanair.com). On the other hand, British Airways strategy is to become the world’s leading global premium airline by making cost that is base more efficiently and focus on outstanding customer service, which is a critical part of their strategy. The 5 strategy goals are to be the airline of choice for long haul premium customers, deliver and outstanding service for customers at every touch point, grow their presence in key global cities, build on the leading position in London and meet customers’ needs and improve margins through new revenue streams (British Airways PLC .com). The target market of British Airways is leisure travellers, consumers who want comfort and cost is not an issue (marketingmagazine.co.uk). Both aviation companies are customers based but they do differ from each other in their operation strategy.

1.2. Preface As I have studied a M.Sc. in EU Business & Law, I found it ideal to find a topic that would encompass both European business matters as well as aspects of EU law. The European airline industry suits this choice of topic very well as it is a business operating largely across European borders, but it has also been the center of a substantial amount of EU legislation through the deregulation of the industry and the abandonment of state aid for national carriers. This has contributed to great changes in the dynamics and structure of the European airline industry, which I find fascinating and have therefore chosen to analyse this development in more detail through

Ryanair is Europe’s largest low-fares, no-frills short-haul carrier. The organisation was founded in 1985 as a conventional airline but re-launched itself in 1990/1991 as a low-cost carrier, replicating American Southwest Airlines’ business model. Since then Ryanair has grown

1. In-depth environmental analysis of the European Airline industry and discuss the implications for the budget sector and especially for Ryanair. 2. An integrated understanding of the functioning of a company – its human and technical operations, leadership, customer relationships and financial structure. 3. Implications of the internal functioning to create viable strategic positioning and discuss any changes to Ryanair’s approach to ensure an improved sustainability 4. Evaluate the strategic leadership style of Michael O’Leary

We will see how Ryanair was successful as world’s one of the most favoured low-fare airline and how did it apply each of this mix by putting in the