Strategic Analysis of Ryanair: SWOT and PESTLE Analysis

This report provides a strategic analysis of Ryanair, including SWOT and PESTLE analysis. It discusses the company's strengths, weaknesses, opportunities, and threats, as well as the external factors influencing its business. The report also explores different types of leadership and management styles and provides recommendations for an appropriate leadership style. Additionally, it highlights the company's corporate social responsibility initiatives.

Context of Business

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
SWOT Analysis and PESTLE Analysis.................................................................................3
Evaluate the changes in PESTLE factors influencing SWOT of business.............................6
Different Types of Leadership and Management Styles........................................................8
Recommendation for Appropriate Leadership style...............................................................9
Corporate Social Responsibility (CSR)................................................................................10
CONCLUSION..............................................................................................................................11
REFERNCES.................................................................................................................................12

INTRODUCTION
The focus of effective management is to create successful business strategies in order to
achieve the organization's long-term objectives. In response to changing environmental
conditions and client behaviour, the approach is being developed. A smart business strategy can
help an organisation obtain a competitive advantage over its competitors. Profit maximisation is
the basic purpose of strategic management. The process includes setting goals, assessing
procedures, and assessing causes and trends in the external environment. Furthermore, Corporate
Social Responsibility (CSR) initiatives aids the company to improve brand image as well as gain
sustainability in the market. Strategic management assists a company in attaining its goals and
acquiring a competitive edge in the marketplace (Govender and Våland, 2021).
The report concentrates on the strategic analysis of one of the chosen airline company based
in Europe, which is Ryanair. The report's strategic analysis is backed up by business models like
SWOT analysis, which identifies strengths, weaknesses, opportunities, and threats, as well as
PESTLE analysis, which examines external aspects in the business environment. Moreover, the
report highlights the different leadership styles and management style accompanied by
appropriate recommendation on suitable leadership style in order to meet business objectives
effectively and efficiently. Even portrays CSR initiatives of the company using instances.
MAIN BODY
Ryanair is the Irish airline company which is headquartered in Dublin, Ireland. The
company is in the aviation business and specialized in short-haul flights, offering low-cost travel
throughout Europe to its passengers.
SWOT Analysis and PESTLE Analysis
SWOT Analysis
The SWOT analysis includes aspects that influence the company's internal and external
environments (Ryan, 2021). It aids in the identification of the company's strengths, weaknesses,
opportunities, and threats. According to anecdotal evidence, a company formulates its plans and
policies in order to boost its market presence.
Strengths
Some of the strengths are as follows:-
 The company has strong market share
Weakness
Negative factors are:-
 The company aggressive expansion

and financially sound along with
effective business model to maintain its
competitive position and sustainability
in the marketplace.
 One of its strength is that the airline
fares are cost effective which helps to
gain competitive advantage.
 The company has good brand image in
the minds of its passengers as well as it
is recognized as cleanest and greenest
airline of the European Union.
 The company has strong balance sheet
and further, Ryanair gained the profit of
one billion Euros.
 The company has safest stock which the
customers can buy in the airline
industry.
 The company offers 1831 routes which
the highest record and thus, makes
Ryanair pioneer and obtain dominant
lead over its competitors.
may led to overcapacity in the future.
 Ryanair convoluted pricing structure
which makes the customers suspicious
of hidden fees is one of the drawback
for its bad reputation (Müller and
Wrobel, 2021).
 The company remains in
controversies, recently its CEO stated
that ‘operating airline with social
distancing norm is stupid’.
 The union members of the company
expressed their dissatisfaction
regarding the pay and working
conditions.
 In accordance with the surpassing
performance of 2019, the company laid
off 15 percent of its workforce.
Opportunities
These are:-
 Many airlines company have shut down
or bankrupted. Thus, the crisis could be
beneficial for the company to prove its
resilience by eliminating its competitors
(Jiang, 2021).
 The company can provide skilled
workforce opportunity to hire best
human resources.
Threats
The threats in relation to the company are:-
 The company has no control over the
government regulations. Ryanair
violation of COVID- 19 norms could
be a threat.
 The pandemic may led to fluctuation in
prices and ultimately affecting the
company’s revenue and profit margins.
 Ryanair is up against competition from

 The COVID-19 pandemic situation
could be a chance for Ryanair to
acquire aircrafts at cheaper rates.
 It is predicted that the Southwest
Airline’s stock can rise high after the
government travel restrictions and thus,
expected that the company’s stock
could surge.
other low-cost airlines.
 The pandemic has lowered the air
travel confidence among the people and
thus, would take time to come to
normal.
PESTLE Analysis
It is vital for the chosen organisation to comprehend the external influences on their
operations. A number of factors have an impact on the company's operations and performance.
The PESTLE analysis is used to determine whether of these are present. This method is used to
figure out how external influences affect a business's success (Kamsaris, 2021). These factors are
discussed below:-
 Political Factors: The uncertainty of Brexit effect caused a challenge for the Ryanair, as
the now the company need to focus on its growth away from the United Kingdom until
the effect gets completed. Even the pandemic situation increased the government
intervention in the airline industry has adversely affected the company.
 Economic Factors: The COVID- 19 pandemic caused adverse impact on the company.
Further the inflation and weaker GBP post Brexit has increased the pressure on
company’s fare prices.
 Social Factors: These factors indicates how societal changes have an impact on business
strategies. The consumer is preferring speed rail and other carriers over airlines for short
distances. The COVID- 19 has led them to travel through their personal vehicles rather
than public transport. As a result, in order to please its target audience, the company
develops Corporate Social Responsibility programmes such as low fare customer friendly
growth aids company to attain goals effectively and efficiently.
 Technological Factors: The Company is require to be updated in the pace of technology
so as to achieve objectives in efficient manner. Ryanair has made technology

enhancements to improve and provide customers with best experience. Online booking
and other services is beneficial for the company to acquire customer satisfaction goals.
 Legal Factors: The Brexit effect may require the company to adhere with both the UK as
well as EU regulations. Even the company is subject to lawsuits by European
Commission for acquiring state aid at several airports in Europe.
 Environmental Factors: These factors are beneficial to attain environmental
sustainability in the competitive market. Ryanair focus on strong environmental
initiatives and is considered as Europe’s cleanest and greenest airline. It operates with
lowest emissions amongst its competitors.
Evaluate the changes in PESTLE factors influencing SWOT of business
Some external factors which has influenced the opportunities and threats of the business
are as follows:-
Opportunities
 Social Factors: Ryanair can take the advantage of the COVID- 19 situation and attract
the customers by proving its resilience. As the crisis have shut down many airlines and
thus, could be beneficial for the company to influence customers with its low cost
strategies (Hunziker, 2021). Accordingly company can formulate CSR programmes in
order to achieve customer satisfaction objectives.
 Technological Factors: The technology upgrade can be useful for the company to
acquire market effectively. The company recently implemented Flight Aware’s software
in order to track aircraft. Thus, these innovation will help the company to maintain its
brand image in the competitive market.
 Environmental Factors: Being the Europe’s greenest and cleanest airline can be
considered as an opportunity to attract and grow for long term in the airline industry. The
company’s environmental initiatives are beneficial to gain competitive advantage. The
company is investing in acquiring new aircrafts and formulating strategies to minimize
the impact on the environment.
Threats
 Political Factors: These factors can be threat to the company as government restrictions
are beyond the company's control. The breach of governmental regulations for instance
COVID- 19 norms could pose a threat. The uncertainty of Brexit challenge and impact of

pandemic has adversely impacted the company. Furthermore, the terrorist attacks can
also affect the demand of air travel (Larkin, 2021). Legal Factors: Even the lawsuits by European Commission on Ryanair for receiving
state aid from several airports in Europe could pose a threat on company’s brand image.
The Ryanair need to comply with UK as well as EU regulations due to Brexit, which will
affect the company’s business model and even profit margins. Economic Factors: May threat could arise due to weaker GBP which will put pressure
on the company to change its fare prices. The pandemic situation has caused adverse
impact on the economy and airline industry. The COVID- 19 pandemic could cause
pricing fluctuations, impacting the company's revenue and profit margins.
Moreover, critically evaluated below the airline’s strength to negate threats and weakness
affecting opportunities.
Strengths
 The pioneer image accompanied by dominant lead can help to combat the treat of other
competition in the airline industry.
 The company’s low fare prices can help to gain competitive advantage in the industry.
 The strong balance sheet and strong performance can be beneficial in combating with
pandemic situation.
 The company through initiatives such as cost friendly growth and so on can help to
regain travel confidence among its potential customers.
Weakness
 The controversial image of the company can affect the scope of company to achieve its
organizational goals.
 Aggressive expansion can affect the customer experiences and may cause impact on the
service quality of the company.
 The dissatisfaction of company’s union members is likely to affect the performance of
the workforce and further will create hindrances for recruiting skilled workforce.
 The suspicious pricing structure will not be helpful in attracting audiences.
Different Types of Leadership and Management Styles
The management and leadership style of a company determines how they exercise authority
in the workplace. The manager's behaviour and attitude toward the organisation are crucial parts

of management style (Salimi, 2021). There are numerous management approaches which are
discussed below:
 Laissez-faire management style: Under this management style, employees have the
freedom to work as they see fit, while supervisors' influence is minimal. When anything
goes wrong and the team requests for help, the manager engages in this form of
management. Under this style all employees are highly trained and there is no need to
supervise. This form of style is less applied in the organization.
 Democratic management style: Managers that utilise a democratic management style
strive to promote employees' opinions and encourage the participation in decision-
making. The management retains the final decision in this system, but the manager takes
into account the employees' opinions, thoughts, and recommendations. This form requires
effective channel of communication. Under this style the employees feel valued and thus,
are more committed towards the organizational goals.
 Coaching management style: This style aims to focus on personal as well as professional
developments of employees in the organization. Leaders adhering this style put great
emphasizes on the needs of its employees. The aim of the style is to provide opportunities
and guidance to employees so as to make them thrive in their career path.
 Visionary management style: This style encourages the authoritarian decision making
and guides the employees towards common goals. Under this style leaders rely on the
team to achieve its goals and as a result the employees have more autonomy.
Being a leader is not easy, as a leader is in charge of a team's various activities. As stated
below, there are a range of leadership approaches that can be utilised to boost a company's
efficiency.
 Autocratic leadership: In this sort of leadership approach, where the power to control
decision lies the hand of single person and takes less inputs from others. Autocratic
leaders make decisions on bases of their beliefs and not involve others to make
recommendations or suggestions (King, 2021).
 Authoritarian leadership: In this case, the leaders establish procedures and objectives
that must be met by the employees. The leader has direct control over their operations,
and the line of command is effective. This personality type aids in the production of

consistent results in the workplace. This is regarded as rigorous leadership, which can
have a negative impact on employees and, as a result, increase employee turnover.
 Participative leadership: The essence of this form of leadership style is to engage
employees in decision making process. It helps to increase the morale of employees or
team members and ultimately help to achieve organizational goals in effective manner.
Generally the major drawback is that the security issues arises when the information
becomes transparent. Further the unskilled workforce can led to poor decision which will
adversely impact the organization (Harbott, 2021).
 Delegative leadership: Also known as “laissez- faire leadership” and focus on delegating
authority to team members which are require to be competent. Furthermore, this style
creates positive and ideal workplace. The main disadvantage is that the responsibility is
not defined properly.
 Transactional Leadership: It provides relation through transaction between the leaders
and its followers. It helps to eliminate confusion in the chain of command. And further
the employees are motivated by being recognized and rewarded for their time and effort.
 Transformational leadership: This form of leadership inspires the followers towards
vision of the company and even inspires them to achieve common goals. It is considered
as coercive approach and places high value on relationships.
Ryanair follows the autocratic leadership and highly transformational leadership style. This
approach of Michael O’Leary, CEO of the company, seems to be appropriate in dynamic nature
in order to result rapid expansion. On the other hand the company even faces the consequences
of such leadership styles (Bausch, Gartner and Ortanderl, 2021).
Recommendation for Appropriate Leadership style
The Michael O’Leary adhere the autocratic leadership style in which the manager has the
control of decision making and involves less to facilitate suggestion or opinions. He believe that
he formulate effective strategies and take best decision in its ability. However, in the modern era,
this theory is dispensed and requires the participation of other organizational members so as to
derive best results and success for long term.
According to Odumeru and Ogbonna (2013), the transactional theory is the managerial
leadership style that focus on to encourage employees through punishment and reward. The
employees will get motivated and will develop competitive spirit amongst them. Whereas,

transformational leaders through punishment and reward can gain the active participation of
employees in the organization (de Boer, 2021). The transformational theory makes the leader to
motivate, inspire and stimulate its followers to contribute best towards organizational goals.
Michael O’ Leary must adhere the mixture of both transactional and transformational leadership
styles. As the autocratic leadership style is not fruitful for the company as results in decline or
revenue and profit margins. Therefore, a mix of transactional and transformational leadership
approach would help the Michael O’ Leary to build strong employment relations and will help in
increment of staff retention rate. Moreover, it will aid in the enhancement of employees’
performance in order to sustain in the competitive environment.
Corporate Social Responsibility (CSR)
CSR means the responsibility of the company towards its society in order to thrive in the
business environment. Several companies formulates CSR initiatives so as to maintain their
sustainability in the competitive marketplace and in the minds of potential audiences. CSR is
beneficial for the companies in deriving profitability and also maximum benefits to the society.
The organization is require to establish effective CSR initiatives to obtain competitive advantage
in the marketplace (Qaisar and Muhamad, 2021).
Ryanair brand itself as the greenest and cleanest Europe airline with low fares. The fights
are significantly cheaper as compared to other competitors. The company in trying to be
cheapest airline among its competitors by aligning the company’s resources and competencies
such as Boeing 737-800 aircraft in order to incur less cost. The company has awful reputation in
terms of CSR issues. The airline has series of conflicts such as false and misleading information
on company’s website like contributing 2 percent towards climate. Furthermore, the company in
2008 has to bring down their website due to their misleading price list. Another CSR issue is the
company’s social responsibility. The company’s statement shows that the aim of the company is
only to earn profit and not the welfare of its potential customers. Ryanair is require to maintain
standard of customer service. As a result such inefficient services led to bad reputation of
company. Furthermore, the company faces certain allegations such as they charge extra for
making online payment, while boarding language and so on. The low cost by cutting off the
luxury or comfort does not lead to customer satisfaction. It only implies that the company is
mainly focusing on earning profits rather than paying attention to the needs of its customers. For

necessity comfort or luxury the company the customers are require to pay extra charges, which
creates bad relationships (Sutherland, 2021).
Ryanair obtain competitive advantage over the competitors due to its strategies but also is
not effective in terms of corporate and social responsibility to its potential customers. The
company is require to enhance its CSR initiatives in order to continue maintain its market
position and competitive advantages through its operating functions such as efficient customer
services, proper procedures for customer support and further interpersonal responsible
improvement to derive desired outcomes and sustainability in the industry.
Ryanair is now focusing on improving environmental performance and responsibility
towards its customers. The launch of Always Getting Better (AGB) customer service and further
increased its focus on digital platform by launching its new website and application (Landa,
2021). This technique of the company has improved the interactions between its potential
audience and even the company aims to facilitate services and information require to make their
travel experience best and comfortable.
CONCLUSION
The above report concludes that the business employs effective strategies to gain
competitive advantage over their competitors. The organizations are require to update their
strategies and policies keeping in mind the changing needs of business environment. As in this
report the Ryanair airline company of Europe is chosen to better understand the internal and
external environment through various business models. The report briefly examined the SWOT
and PESTLE analysis and further, evaluated the external factors influencing the company’s
opportunities and threats. The report examined the company’s strength to negate threats and its
weakness affecting opportunities. In addition, the report highlighted the different types of
leadership and management styles accompanied by recommendation in respect of suitable
leadership style to meet business objectives effectively and efficiently. Lastly, the report
critically examined the Corporate Social Responsibility of the company along with relevant
evidences.

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