Ryan Air Case Study

Topics: Airline, Low-cost carrier, Southwest Airlines Pages: 20 (4060 words) Published: November 29, 2014

Ryan Air Case Study
Strategic Management

Names:

Table of Contents

Step 1: Identifying the positioning questions
1.1 Summary of the casepg. 2
1.2 Main Questions & Problemspg. 3
1.3 How was the strategy developed?pg. 3
Step 2: Gathering & analyzing the facts
2.1 Ryan Air Environment Analysespg. 3
2.2 Ryan Air Strategic Capability Analysespg. 5
2.4 Ryan Air Competitive Strategy & Business Model Analysispg. 5 2.5 Ryan Air Stakeholder expectations & purposes Analysispg. 7 2.6 Ryan Air Economics Analysispg. 9
2.7 SWOT Analysispg.10
Step 3: Alternative Courses of Action
3.1 Alternative courses of actionpg.11
3.2 Evaluation considering mission & long term goalspg.12 3.3 Advantages & Disadvantagespg.13
Step 4: Decision & Reasoning
4.1 Chosen course of actionpg.14
4.2 Sustainability, Acceptability & Feasibilitypg.15
Step 5: Implementation
5.1 Action Planpg.17
6. Referencespg.19

Step 1: Identifying the positioning questions
1.1 Summary of the case
Ryan Air is an airline company which was founded in 1985 in the aim of providing passengers with scheduled air travel services on the routes between Ireland and the United Kingdom, which at the time was operated only by the airline Aer Lingus. When they started the company, the Ryan family ran it as a conventional airline, which meant that there were 2 differently priced seats offered to the passengers. Even though the company grew, the airline began to grow in the direction of the Southwest Airlines model, to become the first European provider of low cost and no frills airline. Ryan airs strategy was born form its objective of maintaining “its position as Europes leading low cost airline, operating frequent point to point short haul flights, mainly out of regional and secondary airports […] designed to stimulate demand, particularly from budget conscious leisure and business travelers, who might otherwise have used alternative forms of transportation, or who might not have travelled at all” (Case Study, 2004) By 2003, Ryan Airs fleet of aircraft had grown up to 54, yet the in January of 2004 the company issued its first profit warning in 26 quarters. Further, projections suggested that Ryan Air would once again start making profits in 2005 at the earliest. This was perhaps due to the drop in ticket sales in 2004, as in part due to the actions taken against Ryan Air by the EU competition commission which in essence tried to force Ryan Air to raise its ticket prices. Further issues faces by Ryan Air include a law suit for not providing free wheelchair services to their disabled passengers, as well as staff attempts to renegotiate remuneration.

1.2 Main Questions & Problems
Ryan Air needs to adopt a revised business strategy that will enable them to remain competitive within their industry, while maintaining a positive image for the organization. 1.3 How was the strategy developed?

Considering that the airline had a very clear image of the type of business they want to run, as outlined in their objectives, this is a ‘strategy as design’. Michael O’Leary was clear in the type of company that he wanted to run, facing problems in a systematic, analytical, and even logical way. This is an ‘intended strategy’, which was based on the vision and ideals of the CEO (Johnson et al, 2011).

Step 2: Gathering & analyzing the facts
2.1 Ryan Air Environment Analyses
PESTEL Analysis: Conducting this analysis will allow us to understand the impact of the environmental factors which can be the cause for failure or success in a strategy. Framework
Ryan Air Case
Political
The routes that Ryan Air operates are almost all in Europe and even within the European Union, which would suggest a political environment which is stable. However, as low cost air travel providers, political support from local governments to their own low cost airlines and national carriers can...

References: About Us. (n.d.). Ryanair and the Environment. Retrieved April 2, 2014, from http://www.ryanair.com/en/about/ryanair-and-the-environment
Assen, M. v., Berg, G. V., Pietersma, P., & Have, S. t. (2009). Key management models: the 60+ models every manager needs to know (2nd ed.). Harlow, England: Financial Times/Prentice Hall.
Johnson, G., Scholes, K., & Whittington, R. (2011). Exploring strategy (9th ed.). Harlow: Financial Times Prentice Hall.
O 'Sullivan, D. (n.d.). Defining Objectives. Sagepub. Retrieved April 1, 2014, from http://www.sagepub.com/upm-data/23139_Chapter_5.pdf
Ryanair reprimanded for 'misleading ' advertisements. (2010, July 14). BBC News. Retrieved April 2, 2014, from http://www.bbc.co.uk/news/10626652
Ryanair told to cut Aer Lingus stake by Competition Commission. (n.d.). BBC News. Retrieved April 2, 2014, from http://www.bbc.com/news/business-23860836
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