The strategic analysis of EasyJet and Easy Group --the analysis of organisational assets and Growth-share Matrix analysis for the Easy Group

Topics: Airline, Low-cost carrier, Marketing Pages: 20 (3783 words) Published: April 24, 2004
Introduction

The assignment was based on a strategic marketing analysis of Easy Jet and Easy Group. It will be carried out through two exclusive parts.

In the first part, firstly, we are going to give a general overview on easyJet's assets, then mainly concentrate on its critical capability which formed its core competence. Essentially, historical comparison approach was adopted to evaluate the organization's relative strengths and weakness.

The second one is by constructing a Growth-share Matrix for the Easy Group to better understand the balance portfolios of its different Easy companies in it and then the core competence of Easy group will be discussed in detailed.

Part One

1. The overview of easyJet's assets:

1.1 Physical assets

easyJet is based at easyLand, a bright orange building adjacent to the main taxiway at Luton Airport. In an industry where corporate HQs are generally considered to be the ultimate status symbol, it is the very embodiment of the easyJet low-cost ethos.

1.2 Financial assets

easyJet is founded by Stelios Haji-Ioannou and it is now a Public Limited Company.

The main strength of its financial operation s that it got a strong balance sheet which allowed it get enough cash to run the business. (Stelios Haji-Ioannou, 2002)

Figure 1 shows easyJet's revenue and profit chart from 1998 to 2003.

year to end September revenue (£m) profit

(£m)

1998 77.0 5.9

1999 139.8 1.3

2000 263.7 22.1

2001 356.9 40.1

2002 552.0 71.6

2003 932.0 52.0

Figure 1. (go-fly.com, 2004a.)

Figure 2 shows easyJet's financial conditions in 2003.

Company Type Public (London: EZJ)

Fiscal Year-End September

2003 Sales (mil.) $1,552.7

1-Year Sales Growth 80.2%

2003 Net Income (mil.) $54.0

1-Year Net Income Growth (29.4%)

2002 Employees 2,045

1-Year Employee Growth 27.9%

Figure2. (Hoovers, 2004)

1.3 Operations assets

easyJet is now offering143 routes from 43 European airports, operating 72 aircraft(67 Boeing 737 series and 5 Airbus A319s) in November 2003. The phenomenal growth of EasyJet was boosted by its merger with Go-fly in August 2002, making the combined company Europe's Number 1 low cost airline. Moreover, easyJet has placed a firm order for 120 Airbus A319 aircraft from September 2003 over five years, with 'price protection' on a further 120 Airbus A319 aircraft until 2012. (go-fly.com, 2004b.)

1.4 Human assets

By November 2003, easyJet has employed over three thousand staffs

function staff numbers

call centre 224

airport operations 417

pilots and cabin crew 2330

management and admin 482

total 3,453

Figure3. (easyJet.com 2004 a.)

easyJet has established an open employee management style which smooths the communication within the organisation. For example, easyJet asks their cabin crew staff to comment on aspects of their work on their internal web site. Most of the firm's corporate information is shared across the business and employees can get information electronically. There are also regular communication meetings, management briefings and a regular newsletter which is sent to all staff. Furthermore, easyJet is committed to being an equal opportunities employer (bized.ac.uk 2004)

1.5 Legal assets & Systems

easyJet is copyrighted as easyJet airline company ltd. The embodiment of the brand on the Internet is the domain name, so it might be expected that the business would be sensitive to similar names. A report on CNN outlined why the easyJet case to have the rights to the domain name easy-jet.com (first registered by an ink jet cartridge company) has been rejected by the WIPO. (Cranfield School of Management, 2001)

The company has established the customer database and the managerial information by the application of internet. The use of site tracking is a good example of control customer information. Similarly, it allows easyJet to easily communicate within organization upward and downward....
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